OECD Releases Updated Transfer Pricing Guidelines

On 20 January 2022, the Organisation for Economic Cooperation and Development (OECD) issued an update to its July 2017 Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (Transfer Pricing Guidelines). There are significant changes to the guidance in respect of the profit split method, hard-to-value intangibles (HTVI) and financial transactions.

Guidance for Tax Administrations on the Application of the Approach to Hard-to-Value Intangibles

On 21 June 2018, the OECD released the report Guidance for Tax Administrations on the Application of the Approach to Hard-to-Value Intangibles, under it Base Erosion and Profit-Shifting (BEPS) Action 8 (which was the development of transfer pricing rules or special measures for transfers of HTVI aimed at preventing BEPS by moving intangibles among group members). This new guidance was aimed at reaching a common understanding and practice among tax administrations on how to apply adjustments