Explore our recent webinar “The Transfer Pricing Code: Navigating Arm’s Length Rules for Global Intragroup Financial Transactions,” which explored the key principles and guidelines governing financing relationships between related parties, particularly within corporate groups.
During the session, we covered the latest developments in intercompany financing, including new transfer pricing regulations from the OECD, the U.S. Treasury, the EU Joint Transfer Pricing Forum (JTPF), and Germany’s updated guidelines.
Key Focus Areas
Throughout the webinar, we highlighted:
- The importance of following the arm’s length principle when allocating income within intragroup financing.
- The need for detailed functional and risk analyses in related-party transactions to ensure proper compliance.
- How to determine customary interest rates based on the creditworthiness of related parties, including the concept of implicit support.
- A complete guide to meeting both legal and economic standards in intragroup financing transactions.
Watch the webinar recording and download the slides for a comprehensive overview of the strategies discussed.
Agenda
- OECD Chapter X Guidelines: Understanding the framework for income allocation in financing relationships between related parties, based on Chapter X of Annex 1 from the OECD.
- IRS’s 2024 Approach to Implicit Support: Learn how this approach impacts creditworthiness assessments in intragroup financing.
- Germany’s New Guidelines: A review of Germany’s financial services rules and how to ensure compliance in intercompany financing transactions.
- Shareholder Loans and Interest Rates: Discussion on the non-recognition of shareholder loans and the recalculation of interest rates for borrowers, especially those with beyond investment-grade ratings.
- Interest Rate Determination: How to set an arm’s length interest rate that reflects the borrower’s creditworthiness and the financial health of the company group.
- Documentation Requirements: The critical importance of maintaining accurate documentation to prove that financing and interest rates meet arm’s length standards.
Speakers
- Nishant Gupta, Associate, TPA Global
- Nikhil Krishnan, Associate, TPA Global
