Transfer Pricing

Treasury management and cash pooling: how is the COVID-19 crisis affecting transfer prices?

The economic downturn triggered by the COVID-19 pandemic is affecting wide swathes of sectors and companies. In particular, the treasury departments of multinationals have needed to boost their liquidity levels to cope with this unstable economic environment and meet their short- and medium-term financial obligations. Treasurers have a range of strategies at […]

How BEPS 2.0 unified approach will revolutionize business models

With its new proposal (published October 9), the OECD tries to answer one burning question: How can profits and corresponding taxing rights on cross-border activities performed by multinationals be (re)allocated to cope with the ever-changing business models of the 21st century? The OECD’s objective is to build a consensus by the end of 2020 on interna […]

Transfer pricing in Luxembourg: what to consider when restructuring

This article was prepared together with Khyati Joneja. Business restructurings are normally associated with a transfer of functions, risks, or assets between the entities of a group—and that means transfer pricing consequences. The restructured group entity is usually entitled to an (arm’s-length) compensation, the assessment of which requires the use tra […]

Don’t miss the EU Joint Transfer Pricing Forum’s guidance on the profit-split method

The EU Joint Transfer Pricing Forum (JTPF) assists and advises the European Commission on transfer pricing tax matters. Recently, it issued a report on the application of the profit-split method (PSM) within the EU.[1] The report clarifies key concepts and elaborates under which conditions the method is to be used and how to split the profit. Being complement […]

Brexit and asset management: the Luxembourg transfer pricing perspective

The asset management industry in the United Kingdom is the one of the biggest in the world, while Luxembourg is often cited as a key jurisdiction for asset management too, being the largest fund domicile in the EU. At present, although the Brexit negotiations between the UK and EU seem to be at a standstill, many leading asset management firms are planning fo […]

New court decision shows importance of updated transfer pricing documentation

In a recent court case[1] about transfer pricing for interest rates on intra-group loans, the court ruled in favor of the Luxembourg Tax Authorities (LTA). The LTA had challenged the 12% interest rate payouts of the Luxembourg company (LuxCo), which were considered to deviate from the arm’s length principle. The excessive interest was requalified as hidden div […]