PE negative list and fragmentation of activities within groups of companies

The contribution deals with the PE exception included in article 5(4) of the 1977 OECD Model tax convention. In particular, it runs through the early history of the provision, trying to reconstruct its rationale, then it analyzes its evolution from the 1963 OECD Draft Model until the most recent changes, which have been brought about as result of Action 7 of the BEPS Project, and, based on that background, attempts to answer some unresolved issues concerning its interpretation.