CRA equates “enterprise” in the services p.e. rule in the Canada-U.S. Convention with a “business division”

The determination of whether Canadian construction projects for a Canadian client of a U.S.-resident company (USCo) will be deemed to be permanent establishments under Art. V, para. 3 of the Canada-U.S. Convention will not take into account project-related services which it provides off-site. However, if it does not have a deemed p.e. under para. 3, its off-site services performed in Canada will be reviewed to determine if they cause it to have a services p.e. under para. 9. Conversely, if it has a deemed p.e. under para. 3, its on-site services will be ignored for purposes of determining whether it also has a services p.e. under para. 9.

Para. 9 refers to an "enterprise" of a contracting state. CRA considers that a U.S. company will be a separate "enterprise" respecting each of its businesses (as determined under the IT-206R criteria).

Neal Armstrong. Summary of 25 February 2014 Memo 2013-0475161I7 under Treaties – Art. 5.