Arcotia Hatsidimitris - International Tax Dialogue

10 – EXECUTIVE SUMMARY
the fact finding phase is as distinct as possible from later and more adversarial phases of an
enquiry. The trend towards more real time working of cases is positive and can encourage
earlier co-operation between tax administrations.
• Transfer pricing programmes benefit from an explicit governance process. The report
discusses some of the approaches to transfer pricing governance that countries have
developed. Robust and transparent governance arrangements provide an assurance to
business about the consistency of approach to transfer pricing cases.
• Maintaining progress in transfer pricing cases can be a challenge but there are some common
causes of delay and some specific practical steps that can be taken to address them.
Alternative dispute resolution techniques, including Early Neutral Evaluation, may well be
of value in transfer pricing disputes and their use should be explored further.
• It is important to recognise when the time has come to stop further fact finding and reach a
decision in a transfer pricing case. Good governance can be of assistance in helping tax
administrations make decisions, including whether to litigate. Internal appeal functions can
also play a positive part in resolving cases.
• Transfer pricing cases place particular demands on tax administrations, as they often require
them to deploy a complex mix of scarce skills and specialist knowledge. There is no single
right way to meet this challenge but improving knowledge management and training are
essential. External experts have an important part to play in supporting the transfer pricing
work of tax administrations.
The report discusses the particular challenges that transfer pricing poses for tax administrations in
developing countries. It discusses ways in which those difficulties can be overcome.
The FTA includes tax administrations from OECD and non-OECD countries and its members are
well placed to share relevant experience and expertise with administrations that are developing their
transfer pricing capability. The report recommends specific actions the FTA could take to support the
work of tax administrations and other international organisations in this field. This support will be
demand led and includes a focus on measures that will help to improve financial transparency that will
assist in transfer pricing work and more generally.
DEALING EFFECTIVELY WITH THE CHALLENGES OF TRANSFER PRICING © OECD 2012