Is ForCo engaged in business in the United States

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Question - ForCo, a foreign corporation, has an agreement with an unrelated U.S. corporation, USCo, under which USCo acts as ForCo's exclusive agent in selling ForCo's products in the United States and receives a commission for each sale made. The agreement forbids USCo from acting as agent or principal in making sales of competing goods.

a) Is ForCo engaged in business in the United States?

b) Are ForCo's U.S. tax liabilities affected if ForCo's country of residence has a tax treaty with the United States identical to the Model Treaty?

c) How would the answer to the foregoing questions be different if ForCo owned all of USCo's stock?

d) How would the answer to the foregoing questions be different if USCo, instead of selling on commission, purchased goods from ForCo and resold them to customers in the United States?

Reference no: EM132104349

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