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ARTICLE · 02 SEPTEMBER 2024

How Intercompany Agreements Can Mitigate Transfer Pricing Risk

Mayer Brown
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Multinational groups constantly evolve, grow, and consolidate, and operational facts and circumstances always change. Say a growing company decides to expand internationally. It may choose to incorporate new...

United StatesTax
Anthony D. Pastore
Anthony D. Pastore
Sonal Majmudar
Sonal Majmudar
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Multinational groups constantly evolve, grow, and consolidate, and operational facts and circumstances always change. Say a growing company decides to expand internationally. It may choose to incorporate new foreign subsidiaries that will operate a manufacturing facility in one country and a limited-risk distributor in another.

The tax department will probably pay a lot of attention to the proper transfer pricing for transactions between these related parties of the growing multinational group. When it does so, it should ensure that the intercompany transactions, including the arm's-length pricing, are memorialized in written intercompany agreements. We'll address the most common questions you might have about these agreements.

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This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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