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Transfer pricing

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Compliance with global transfer pricing laws presents significant challenges for any business engaged in cross-border transactions. As a global law firm with a presence in more than 50 cities worldwide, our transfer pricing practice is ideally positioned to help clients navigate the complex global regulatory, compliance and government enforcement environment relating to transfer pricing, as well as advise on the most appropriate transfer pricing structures.

Our lawyers understand that assisting with transfer pricing planning and controversy requires not only an appreciation of domestic tax rules relevant to the business, but also access to knowledgeable tax professionals on the ground in the jurisdictions concerned. We have experience advising on transfer pricing matters across a broad range of industries, combined with specialist knowledge of tax issues affecting key industry sectors.

Our areas of work include

  • transfer pricing planning, documentation and structuring (including intercompany agreements)
  • audits and administrative appeals
  • competent authority cases
  • unilateral and bilateral advance pricing agreements
  • transfer pricing disputes and litigation.

Our recent experience

  • Representing a publicly traded technology company in defending a buy-in under a cost sharing agreement for certain intangible property rights. Although the tax authorities initially proposed a buy-in valuation exceeding US$2bn (the taxpayer’s valuation was in the US$600m range), the case was settled with a pricing adjustment limited to 10 per cent of the taxpayer’s initial buy-in valuation.
  • Advising a multinational petrochemicals manufacturer in Tier I audit case relating to the pricing methodology selected for an outbound buy-in under a cost sharing agreement for intangible property rights. Although a multimillion-dollar pricing reduction was initially proposed by the IRS, by taking a proactive stance at the audit stage the audit was concluded without a pricing adjustment and within eight months of the commencement of the audit.
  • Advising a global beverage company on whether an arm’s length charge was received by the US licensor for the use of certain intangibles. The amount in controversy exceeded US$500m. The audit was concluded favourably without an adjustment to the selected royalty pricing methodology.
  • Representing an oil and gas company before the IRS on issues arising during the course of multiple examinations, principally dealing with the proper application of the comparable profits method to the transfer of tangible property. The case was conceded by IRS Appeals.
  • Advising a Dutch utility company on the transfer pricing methodology used for price-setting purposes under a tolling agreement.
  • Advising an international container terminal operator on intra-group financing arrangements and arm’s length pricing of risks assumed and function performed in several intra-group financing companies with total funds flow in excess of US$2bn.