In May 1998 China’s State Administration of Taxation (SAT) released a comprehensive circular on transfer pricing entitled "Tax Administration Rules and Procedures for Transactions Between Related Parties" (Guoshuifa [1998] 59).1 The circular was directed at modernising efforts to control alleged tax avoidance by multinational companies (MNCs) and consolidate many previously issued transfer pricing rules. For a detailed analysis of the circular and the June 1998 meeting with SAT officials following the issuance of the Circular see BNA’s Transfer Pricing (July 29, 1998)2
In November 2001 we were invited by SAT (National) in Beijing to discuss China’s experience with Circular 59, as well as other recent developments with regard to China’s rapidly developing transfer pricing enforcement policies.
