Czech News - Nov 96 - Transfer Pricing Guidelines

Revised Transfer Pricing Guidelines which were approved by the Committee on Fiscal Affairs on 27 June 1995 and by the OECD Council for publication on 13 July 1995 are being supplemented with additional chapters addressing other aspects of transfer pricing in the course of 1996.

In 1996 two additional chapters were already introduced and consequently, the complete contents of the "Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations" for 1996 consists of the following chapters:

• The Arm's Lengths Principle
• Traditional Transaction Methods
• Other Methods
• Administrative approaches to avoiding and resolving transfer pricing disputes
• Documentation
• Special Considerations for Intangible Property (new)
• Special Considerations for Intra Group Services (new)

Although the Czech Republic as a member of the OECD has not yet created any legislation to implement these guidelines, arm's length principles are included already in the Czech tax legislation. Hence, when reviewing the impact of current Czech legislation concerning transfer pricing, these guidelines should be taken into account.

The content of this article is intended to provide a general guide to the subject matter. It is therefore not a substitute for specialist advice.

For further information contact Paul Antrobus or Richard Fletcher, Arthur Andersen Prague, tel +42 2 2440 1300 or enter a text search 'Arthur Andersen' and 'Business Monitor'.