[Code of Federal Regulations]
[Title 26, Volume 18, Parts 500 to 599]
[Revised as of April 1, 2000]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR514.112]

[Page 98]
 
                       TITLE 26--INTERNAL REVENUE
 
     CHAPTER 1--INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY 
                               (Continued)
 
PART 514--FRANCE--Table of Contents
 
                       Subpart--General Income Tax
 
Sec. 514.112  Stocks, securities, and commodities.

    Under Article 11 of the convention, gains derived from the sale or 
exchange within the United States of stocks, securities, or commodities 
(if of a kind customarily dealt in on an organized commodity exchange) 
by a nonresident alien individual resident in France, or by a French 
corporation or other French entity, is exempt from Federal income tax 
unless such individual, corporation, or other entity has a permanent 
establishment in the United States. If, however, a permanent 
establishment is maintained in the United States, such gains are not so 
exempt even though the sales or exchanges resulting in such gains were 
carried on directly from the home office of the taxpayer and not through 
the permanent establishment in the United States. As to what constitutes 
a permanent establishment, see Sec. 514.104(b)(1).