international european-union insurance corporate-tax-laws directive
How is place of establishment determined under EU law for insurance purposes?
<p>Under EU law, the country that gets to levy insurance premium tax upon a legal entity is the Member State in which the risk is situated. </p>

<p>Art. 13(d)(ii) of the <a href="https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:02009L0138-20140523&amp;from=EN#page=40" rel="nofollow noreferrer">Solvency II Directive</a> specifies how to determine the country in which the risk is situated:</p>

<blockquote>
  <p>if the policy holder is a legal person, [the risk is situated in] that policy holder’s
  establishment to which the contract relates;</p>
</blockquote>

<p>This seems rather straightforward in the case of a company resident in its country of incorporation. However, how is establishment determined when this is not the case?</p>

<p>Suppose that a technology company is incorporated in EU 'Country A' and has its servers and official headquarters there. The company insures the product which the servers provide. The company's directors live in EU 'Country B', where it is effectively controlled from a branch office and is tax resident.  In such an example, is the place of establishment Country A, where the company is incorporated and where it's servers and primary address are, or in Country B, where it is effectively managed from?</p>

<p>In such an example, the servers are established in 'Country A' (where the company is incorporated), but the company (which bears the financial risk from which it has sought an insurance contract to protect itself) is tax resident and effectively controlled in 'Country B'. How is establishment determined?</p>

<p>Based on the <a href="https://europa.eu/youreurope/business/selling-in-eu/selling-goods-services/provide-services-abroad/index_en.htm" rel="nofollow noreferrer">Providing services abroad within the EU</a> text, this would depend on if the <strong>place of establishment</strong> in <strong>Country B</strong> has been registered there.   </p>

<p>The main criteria being:</p>

<ul>
<li><strong>how often</strong>, for <strong>how long</strong> and <strong>how regularly</strong></li>
</ul>

<p>If I have understood your scenario correctly, both Country A and B have been registered (Country B being tax resident)</p>

<ul>
<li><strong>Country B</strong> effectively controlling <strong>Country A</strong> (which officially is the headquarters) </li>
</ul>

<p>So the local laws of the country each has been registered in will apply, based on it's activities (organizational forms).</p>

<p>Since the organizational forms can differ radicaly between countries, I don't think an answer can be given without knowing which countries <strong>Country A</strong> and <strong>Country B</strong> are. </p>

<p>The <a href="https://www.hk24.de/produktmarken/beratung-service/recht-und-steuern/wirtschaftsrecht/unternehmensgruendung-und-fuehrung/auslaendische-unternehmen-expansion-1156836" rel="nofollow noreferrer"><strong>Chamber of Commerce and Industry</strong></a> (IHK) link give a general summary of organizational forms in Germany. </p>

<p>It also includes information how to deal with a specific form that does not exist in German law (Representation,  <strong>Repräsentanz</strong>). </p>

<hr>

<p>General conditions <strong>without</strong> setup in <em>Country B</em></p>

<blockquote>
  <p>If you have a registered business providing services (as an architect or tourist guide, for example) in the country where you live, you can <strong>offer those services in another EU country without setting up a company or branch</strong> there.</p>
  
  <p>This can be useful if you want to:</p>
  
  <ul>
  <li>provide the service there only temporarily</li>
  <li>provide the service just to a specific client living there</li>
  <li>test the market before expanding your company there.</li>
  </ul>
  
  <p>In principle, you should be able to supply services in another EU country <strong><em>without</em></strong> having to comply with all of that country's <strong>administrative procedures</strong> and <strong>rules</strong> (like obtaining prior authorisation to do business). But you may need to notify the public authorities that you will be offering services in their country. The other country must have <strong>valid reasons for imposing its requirements</strong>.</p>
</blockquote>

<hr>

<p>General conditions <strong>with</strong> setup in <em>Country B</em></p>

<blockquote>
  <p>Despite this principle, you can't just assume you can provide services without setting up a company locally. Whether you can or not will depend mainly on <strong>how often</strong>, for <strong>how long</strong> and <strong>how regularly</strong> you want to provide services.</p>
  
  <p>Also, different rules might apply to certain sectors, for example:</p>
  
  <ul>
  <li><strong>financial services</strong></li>
  <li>healthcare services that may only be practiced by members of a - - regulated health profession</li>
  <li>private security services</li>
  <li>gambling services</li>
  <li>notary services</li>
  <li>temporary work agency services</li>
  <li>telecommunications, broadcasting and electronic services</li>
  </ul>
  
  <p>If you choose to register a company in another EU country, you will have to <strong>comply with national rules</strong> for the incorporation/registration of a subsidiary company, branch or agency and most of that <strong>country's rules for setting up a business</strong> (including recognition of your professional qualifications and applying for the necessary permits). Compliance with national, European or international standards may also be required.</p>
</blockquote>

<hr>

<p><strong>Sources</strong>:</p>

<ul>
<li><a href="https://europa.eu/youreurope/business/selling-in-eu/selling-goods-services/provide-services-abroad/index_en.htm" rel="nofollow noreferrer">Providing services abroad within the EU - Your Europe</a> </li>
<li><a href="https://www.hk24.de/produktmarken/beratung-service/recht-und-steuern/wirtschaftsrecht/unternehmensgruendung-und-fuehrung/auslaendische-unternehmen-expansion-1156836" rel="nofollow noreferrer">Expansion ausländischer Unternehmen im Inland</a> (in German) </li>
</ul>
