ICC Comments on the OECD discussion draft on the scope of the future revision of Chapter VII (intra-group services) of the Transfer Pricing Guidelines

In the context of the Organisation for Economic Co-operation and Development (OECD) projects to revise the guidance in Chapter VII (intra-group services) of the Transfer Pricing Guidelines, ICC submitted high-level and fundamental comments on this Chapter, related to special considerations for intra-group services.

A revision of Chapter VII represents an important opportunity to clarify a significant area of intra-group transactions and more effectively address pressing issues in taxation.

It is to this end that ICC submitted comments to the OECD for consideration.  ICC’s comprehensive remarks note that paramount to these revisions is ensuring that the new text minimizes the risk of inconsistent interpretation and implementation, a factor which would particularly affect developing countries and Small and Medium-sized Enterprises (SME’s). In effect, both tax authorities and the business community stand to benefit from revisions of Chapter VII, as clear and precise guidance can guarantee the efficient allocation of resources for all parties alike.

Given these considerations, ICC has urged the OECD to present a balanced and effective revision of Chapter VII of the Transfer Pricing Guidelines. ICC suggests that the revision of Chapter VII continues efforts to prevent double taxation, further simplifies instructions for SME’s and strongly encourages tax authorities to apply the same requirements for the documentation of services that are both charged to other jurisdictions and acquired from other jurisdictions.

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