Coordinated Transfer Pricing controls: Recommendations from EU Joint Transfer Pricing Forum
The EU Joint Transfer Pricing Forum recently published its report “A coordinated approach to transfer pricing controls within the EU” aimed to provide recommendations on coordinated transfer pricing audits in the European Union.
Coordinated transfer pricing controls are transfer pricing audits of two or more related entities of the same multinational group which are tax resident in different Member States. The controls are carried out by the tax administration of the Member State where each entity is tax resident in a coordinated manner and within the applicable legal framework (i.e. national rules and EU law).
The report highlights that coordinated transfer pricing audits would reduce the administrative burden and costs of unilateral audits that lead to court procedures, Multilateral Agreement Procedures and other dispute settlement mechanisms.