A recently published decision (No. 400.222) of the Belgian Ruling Committee of 24 March 2005 clarifies the profit attribution between a Belgian headquarter and its Mexican branch.
(a) Facts. A Belgian multinational group, which produces household and outdoor equipment, decided to establish a new production unit in Mexico. Accordingly, the Belgian headquarter company, NV A, would establish a Mexican branch (Branch), which would become the owner of the plant, equipment and stock. N…