On February 13, 2026, the German Federal Ministry of Finance (Bundesfinanzministerium or BMF) released a draft of new administrative principles on the definition and creation of permanent establishments (PEs) under domestic tax law (§ 12 AO, § 13 AO) and double tax treaties (Art. 5 OECD Model). The draft represents the most significant update to Germany’s PE framework since the last amendment in 2026 and incorporates extensive BFH case law as well as the OECD’s 2025 Model Convention and Commentary.
