The information provides with a better understanding of the extent to which the HTVI approach described in Chapter VI of the Transfer Pricing Guidelines has been adopted and is applied in practice by countries around the world.
The OECD on December 16 published information submitted by 40 jurisdictions on their legislation and administrative practices applicable to transactions involving hard-to-value intangibles (HTVI).
The jurisdiction-specific information is intended to provide tax administrations, taxpayers, and other stakeholders with a better understanding of the extent to which the HTVI approach described in Chapter VI of the Transfer Pricing Guidelines has been adopted and is applied in practice by countries around the world.
The 40 jurisdictions for which information is provided are: Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, Colombia, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, India, Ireland, Japan, Korea, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Nigeria, Netherlands, New Zealand, Norway, Peru, Poland, Portugal, Singapore, Slovak Republic, Slovenia, South Africa, Spain, Sweden, Switzerland, the UK, and the US.
The HTVI approach was the outcome of the work done under Action 8 of the BEPS project. The HTVI approach protects tax administrations from the negative effects of information asymmetry by ensuring that they can consider ex post outcomes as presumptive evidence about the appropriateness of ex-ante pricing arrangements. At the same time, the approach permits taxpayers to rebut such presumptive evidence by demonstrating the reliability of the information supporting the pricing methodology adopted at the time the controlled transaction took place.
In 2018, the HTVI approach was supplemented with a new annex to Chapter VI of the Guidelines that contains guidance that would ensure a common understanding and practice among tax administrations on how to apply adjustments resulting from the application of the HTVI approach.