Imminent Changes To Transfer Pricing Documentation Requirements In South Africa

On 17 July 2013 the Minister of Finance appointed a tax review committee, headed by Judge Dennis Davis (the "Davis Committee") to make recommendations for possible tax reforms in South Africa ("SA").

The Davis Committee was required to take into account recent international developments and, in particular, to address concerns about base erosion and profit shifting ("BEPS") which was identified as a risk to tax revenues, tax sovereignty and the tax fairness of countries by the Organisation for Economic Co-operation and Development ("OECD") in its report published on 12 February 2013. A 15-point Action Plan was developed by the OECD to address BEPS and to ensure that profits are taxed where the economic activities generating the profits are performed and where value is created. The purpose of the OECD 'Action Plan 13: Re-examine Transfer Pricing Documentation'was tore-assess transfer pricing documentation requirements with the purpose of obtaining information from