- 55 -
this contention, respondent relies in part on the discussion in
the Technical Explanation, see supra pp. 33-34. In respondent's
view, because both countries expected all of their respective
domestic attribution rules to apply, it follows that each country
expected the domestic rule to be reviewed based on the facts of
the entire industry.
We need not engage in a detailed analysis of whether various
foreign insurance companies pay Federal income tax in accordance
with our tax laws.19 Respondent's argument essentially ignores
the language of the referenced discussion of the Technical
Explanation, see supra pp. 33-34. As we previously discussed,
see supra pp. 36-37, we do not believe that the United States and
Canada intended for all domestic attribution rules to be
preserved under Article VII.
Throughout Article VII and particularly Article VII,
paragraph (2), the language therein refers only to a single
permanent establishment rather than the industry in which the
establishment operates. When the language is reasonably clear,
19Respondent's proposed findings of fact include data
relating to other Canadian life insurance companies carrying on
insurance businesses through branches in the United States. On
brief, petitioner objected to the relevancy of these findings
unless the Court concluded that they were relevant "in light of
the ‘test case’ aspect of the proceeding". Because we have
decided the controverted issues without considering these
stipulations in our Findings of Fact and our Opinion, the
admissibility of these stipulations has become moot. Although we
reviewed all the material submitted in this case, we only address
facts affecting petitioner.
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