Month: February 2018

Comparable Uncontrolled Price (CUP method) in Real World

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The arm’s length principle treats the members of a multinational group as operating in separate entities, rather than as inseparable parts of a single unified business. Therefore, it is required multinational enterprises (MNEs) to follow the same pricing policy for intra-group and uncontrolled transactions, under comparable circumstances. Otherwise, the controlled companies shall take the necessary … Read more

Documenting intragroup transactions on machinery and equipment

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Transfer Pricing (TP) guidelines generally require associated entities to invoice each other appropriately so as to correspond to the value of the goods transferred or services provided whenever an intra-group transaction takes place. The basis for determining proper compensation is, in most cases, the arm’s length principle. In a nutshell, the arm’s-length principle requires that … Read more