Gulf Offshore N.S. Limited v. The Queen, 2006 DTC 2705, 2006 TCC 246 -- summary under Article 5

The taxpayer provided a fully-crewed vessel under a charter party to a Canadian resident company for the purpose of transporting pipe and other materials from Nova Scotia to two ships of the Canadian company laying pipe off the coast of Nova Scotia within the Sable Island offshore area. The taxpayer was found to have a permanent establishment in Canada by virtue of Article 27A of the Canada-U.K. Tax Treaty, which provided that a resident of a contracting state who carried on activities in the other state in connection with exploration or exploitation of the seabed and sub-soil and the natural resources situated in the other contracting state was deemed to be carrying on business in the other contracting state through a permanent establishment situated therein. In response to an argument that the taxpayer had entered into a single passive lease that did not represent the carrying on of activities, Miller J. noted that the ship was owned, manned and operated by the taxpayer, and there was no evidence that personnel of the Canadian company even ever stepped foot on the ship.