OECD: Status Quo of the BEPS Project form a TP perspective

Published on September 3, 2018


From our last update regarding the Status Quo of the BEPS project until the present day, different Reports relevant from a Transfer Pricing perspective were published. This update is meant to provide a short overview of the main themes, i.e.: Hard to Value Intangibles (”HTVI”), Profit Split (”PS”), Financial Transactions, Country by Country reporting (”CbCr”) and Permanent Establishments (”PE”).


Hard to Value Intangibles

On May 23 2017 the OECD released a discussion draft of the implementation guidance on HTVI presenting the principles that ground the approach to HTVI. The draft was then followed on the 5th of July by the publication of the comments that had been received. The resulting guidance was then presented on the 21st of June 2018  aiming at establishing a common approach among tax administration on this matter.


Profit Split

The OECD decided to release on June 6 2017 a revised discussion draft (substituting the former discussion draft which was released in June 2016) on transactional PS. This revised draft aimed at further clarifying the application of the transactional PS method. The guidance resulting from mentioned draft was then published on June 21 2018.


Financial Transactions

Given the publication of the updated version of the OECD Transfer Pricing Guidelines in 2017, a clarification for the application of the principle stated in mentioned TPG urged in case of financial transactions. As a response, the OECD published on the 3rd of July 2018 a discussion draft which focused on that theme.


Country by Country reporting

Given the fact that in many countries CbCr rules have been implemented or are going to be implemented in the imminent future, it is not surprising that the OECD focused  different releases on this theme. On July 18th 2017 it released a guidance addressing the treatment of entities owned and/or operated by two or more MNEs that are not related, and the content of Table 1 of the CbCr. On the 6th of September 2017, the OECD released a further guidance on CbCr focusing on the definition of revenues, the approach that should be followed in case of MNE Groups with short accounting periods and the treatment of income tax accrued and income tax paid. From the tax administrations´ perspective, on the 11th of October of 2017 the status of the exchange relationships between tax administrations was released depicting a growing cooperating environment in the exchange of information connected to CbCr. A further guidance addressing specific issues was then released on November 30th 2017. On the 24th of May 2018 the time had come for the first peer review on the application of the CbCr which highlighted  a strong, worldwide progress in the implementation of CbCr.


Permanent Establishment

On June 22nd 2017 the OECD focused once again on PEs by releasing a discussion draft on the attribution of profits to PEs which set high-level general principles. This was then followed, on the 22nd of March 2018 by the release of the report containing additional guidance on the attribution of profits to PEs.



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