The Evolution Of Transfer Pricing In The Digital Economy

Over the past two decades, the global economy has undergone unprecedented transformations driven by digitalization. The business environment has become more interconnected and complex than ever before. Globalization no longer simply signifies geographical market expansion; it has evolved into a dynamic, interlinked system of cross-border operations, integrating production, services, distribution, and intelligent supply chains.

At the heart of these shifts lies an intensified reliance on intangible assets—such as software, databases, trademarks, intellectual property rights, and algorithms—which now represent the primary sources of added value in the digital economy. This intangible nature presents a fundamental challenge to traditional transfer pricing methodologies, as it is difficult to link profits to a specific geographic location or value these assets using conventional market-comparison models. This calls for more advanced and flexible approaches.