The Spanish Supreme Court approach on Subsidiary as a Permanent Establishment: the Roche Vitamins Europe Case

The Supreme Court in a business restructuring case upheld the position of the tax administration considering that a formal offshore relocation of functions does not constitute a valid route for avoiding the taxation of the profits sourced in Spain.
On January 12, 2011, the Spanish Supreme Court issued its long-awaited decision on the Roche Vitamins Europe case, where it ruled that the Spanish subsidiary of Roche Vitamins constituted an agency permanent establishment (PE) of Roche Vitamins Europe, a group company located in Switzerland.