French Finance Bill 2024: strengthening of transfer pricing controls


published on 26 October 2023

The French Finance Bill for 2024 which was just published recently provides for a strengthening of transfer pricing controls via four measures:


  1. Lowering to 150 million euros (from 400 million euros currently) the turnover or gross assets threshold above which a company must produce full transfer pricing documentation (master file and local file). It should be noted that the 150 million euros threshold is assessed not only at the level of the French company, but also at the level of the controlling or controlled companies. The new 150 million euros threshold applies to fiscal years beginning on or after January 1, 2024.
  2. Enforceability of transfer pricing documentation against the taxpayer: Where the method used to determine transfer prices deviates from that set out in the documentation, there is a presumption that profits have been transferred abroad.
  3. Increase of the minimum fine for failure to submit transfer pricing documentation to 50,000 euros per fiscal year (from the current 10,000 euros)
  4. Various measures to strengthen tax authorities' control over disposals of intangible assets that are difficult to value:  
      • Under certain conditions, possibility for the tax authorities to reassess the sale price on the basis of results subsequent to the fiscal year in which the transaction took place 
      • Extension of the limitation period to six years (instead of three) 
      • Possibility of tax audit even if the fiscal year in which the transaction took place has already been subject to a full general tax audit.

This is only a draft Finance Bill to date, but it is likely that these measures will be definitively adopted by the end of the year.


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Aurélia Froissart

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