Arcotia Hatsidimitris - International Tax Dialogue

96 – ANNEX C
In all cases, identifying the scope of potential transfer pricing issues and getting enquiries off to a
good start are the main objectives of the initial fact finding searches and preliminary consideration of
the potential transfer pricing issues identified. Efficiency of approach is also improved by close
collaboration and dialogue between the different parties.
Scoping and preparing a transfer pricing case
Planning a transfer pricing audit with risk analysis
In France, tax audit directorates establish a practical strategy of international tax audit, in line
with the national strategy set by the Central Office and with the bi-annual audit plan set by each
interregional audit directorate and approved by the Central Office.
Risk analysis is used to identify cross border issues. Furthermore, in order to improve the case
selection of transfer pricing audits, several services take part in mutual risk identification and analysis:
general tax audit service, transfer pricing expert team and the head office of the tax audit directorate.
All of those services take into account their economic knowledge derived from their experience
(tax audit teams are specialised by economic activity and belongs to a pool of several audit teams
specialised by economic sector), the tax returns of companies, previous tax audits, mutual agreement
procedures and advance pricing agreement if any, together with news and information from public or
private database.
These are a few examples of planning issues:
• companies which have subsidiaries located in low tax or zero tax countries and territories;
• companies which are not profitable during a long period and which are held by profitable
foreign group;
• business restructuring;
• transfer of intangibles.
Anticipating needs of transfer pricing expert help
In order to shorten the timeframe for dealing with transfer pricing cases, it is important to
determine, at this stage, a first list of companies where a transfer pricing expert will join a general tax
auditor to form a transfer pricing audit team.
In practice, transfer pricing experts work for the national and international tax audit directorate;
they can occasionally help general tax auditors of the inter-regional tax audit directorates (where
international tax experts may answer the questions of general tax auditors).
Added value is expected from transfer pricing experts
• When there are complex and high technical issues in the matter of transfer pricing;
• when there are significant amounts of money at stake;
DEALING EFFECTIVELY WITH THE CHALLENGES OF TRANSFER PRICING © OECD 2012