In this edition of the newsletter, you will find the most important national and global developments in tax law that are (closely) related to the transfer pricing world.
Please feel free to contact us if you have any questions.
In the past month, we successfully completed several challenging and noteworthy projects, including:
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On 30 September, ARCA published General Resolution 5903, overhauling Argentina’s transfer pricing measures effective from 1 October. It increases several reporting thresholds, updates filing deadlines, keeps the local entity as the default tested party and sets conditions for using a non-resident tested party. The new rules also prohibit downward TP adjustments except under a mutual agreement procedure and introduce a specific regime for low-value-added services.
On 2 September, Brazil’s Administrative Council for Tax Appeals (CARF) ruled in Case No. 16682.721233/2023-52 in favour of Repsol Sinopec Brasil S.A., rejecting an attempt by the National Treasury to apply a Return on Average Capital Employed (ROACE) profitability indicator as an additional adjustment under the Comparable Independent Price (PIC) method. The dispute arose over corporate income tax assessments for the 2018 tax year regarding daily charter rates for Floating Production, Storage, and Offloading (FPSO) platforms used in offshore oil and gas exploration. CARF held that transfer pricing adjustments under Brazilian statutory rules are strictly limited to aligning specific commercial conditions, physical differences, or contract terms between traded items, making the tax authority’s use of a macro-level profitability metric such as ROACE impermissible and without a legal basis.
On 8 September (Writ Petition (L) No. 15691 of 2026), the High Court of Bombay ruled in favour of Thomson Reuters International Services Private Limited. Following a corporate merger, the company had submitted a modified tax return pursuant to Section 170A of the Income Tax Act. The court held that the tax authorities erred by issuing a scrutiny notice under Section 143(2) on the modified return, for which they lacked legal jurisdiction, and ruled that the consequential transfer pricing notice (Section 92CA(2)) and associated audit proceedings could not remain valid independently.
On 18 September, the Latvian State Revenue Service published guidance on the controlled transactions report for transfer pricing purposes. The guidance provides practical instructions on the preparation, completion and submission of the report, including filing conditions, deadlines, transaction classification, transaction values, grouping, TP methods and how to file the document through the Electronic Declaration System. Taxpayers must generally submit the report where the total amount of controlled transactions in a reporting year exceeds EUR 250,000. The guidance also stresses that the report should be consistent with the taxpayer’s transfer pricing documentation and accounting records.
On 11 September, the OECD/G20 Inclusive Framework on BEPS released a new administrative package to enhance global consistency and tax certainty under the Pillar Two Global Minimum Tax framework. The package establishes a Full Legislative Review framework for peer-reviewing domestic GloBE legislation, updates the GloBE Information Return (GIR) to incorporate January 2026 Side-by-Side simplification measures for fiscal years starting on or after 31 December 2025, and issues Administrative Guidance clarifying that conditional taxes (triggered by IIR or UTPR exposure elsewhere) cannot be credited as Covered Taxes, while preserving QDMTT Safe Harbour eligibility in cases of mismatched local fiscal accounting periods.
The following updates have been provided by our network partner, BTTP.
A recent individual tax ruling provides useful guidance on transactions between companies subject to Estonian CIT and their shareholders. The Director of the National Revenue Information (KIS) confirmed that rent paid by a company for properties owned by its shareholder does not constitute a hidden profit where the properties are genuinely and continuously used in the company’s business, the rent reflects market conditions and the transaction is justified by the company’s actual business needs. Importantly from a transfer pricing perspective, KIS emphasized that the assessment should not be limited to whether the price itself is at arm’s length but should also consider whether the transaction would have been entered into between unrelated parties at all. This requires looking at the company’s business profile, its actual operational needs, and the economic rationale for the transaction. In the case at hand, the company would have needed to rent comparable premises from unrelated parties if the shareholder’s properties had not been available, while the agreed rent was established at market level. The ruling therefore highlights that, when assessing related-party transactions, not only the arm’s length level of the price but also whether the transaction reflects genuine business needs and would have been entered into between unrelated parties may be relevant (link here).
A recent individual tax ruling confirms that an annual aggregate profitability adjustment in a cost-plus model may qualify as a transfer pricing adjustment under Article 11e of the CIT Act. In the case at hand, a contract manufacturer’s remuneration was calculated during the year using estimated costs and an arm’s length mark-up determined based on a benchmarking analysis, while the actual cost base became available only after year-end. The companies therefore adjusted the manufacturer’s annual profitability to the level resulting from their transfer pricing policy. Importantly, the adjustment related to the annual financial result and was not allocated to individual invoices, services, or monthly prices. KIS accepted that such an adjustment may constitute a revenue adjustment for the contract manufacturer and a corresponding cost adjustment for the related party. The ruling is particularly relevant for cost-plus models based on budgeted or estimated costs, as it confirms that a year-end true-up may fall within Article 11e of the CIT Act where it serves to align the final result with the arm’s length principle and the adopted transfer pricing policy (link here).
On 1 September, the Portuguese Tax and Customs Authority (Autoridade Tributária e Aduaneira) granted administrative relief by extending the initial Pillar Two registration deadline for domestic Constituent Entities. Applicable to in-scope multinational and large domestic groups with fiscal years ending between 31 December 2025 and 31 March 2026, the submission period for initial registration has been extended from 9 to 12 months following the close of the relevant fiscal year.
On 23 September, the Slovak tax authority published the English version of its guidance on its advance pricing arrangement (APA) process, following the Slovak version issued on 5 August. The guidance explains how taxpayers may request advance approval of a transfer pricing method for future controlled transactions with related parties. It covers unilateral, bilateral, and multilateral APAs and provides information on the application process, eligible transactions, filing requirements and related fees, which depend on the APA category and the taxpayer’s tax reliability index.
On 8 September, Switzerland updated its list of exchange partners under the CbC Multilateral Competent Authority Agreement. Benin, Burkina Faso, Dominica, and Greenland were added to the network, with retroactive effect from 1 January 2025. Under this framework, Benin, Burkina Faso, and Dominica are designated as permanently non-reciprocal jurisdictions, meaning Switzerland will receive Country-by-Country reports from these jurisdictions for multinational enterprise groups headquartered there, but will not send reports to them.
On 30 September, Türkiye’s Tax Inspection Board announced three new specialised tax inspection departments, including a dedicated Istanbul International Taxation and Transfer Pricing Sectoral Inspection Department. This department will focus on MNE groups and cross-border transactions, including transfer pricing, thin capitalisation, CFC rules, tax treaties, BEPS, TP documentation, CbCR, MAPs, APAs and Pillar Two. The set-up is intended to strengthen audit capacity through specialisation, data analytics, digital audit tools, and risk-based inspections.
On 4 September, the Ukrainian Cabinet of Ministers submitted draft Law No. 16035 to Parliament, proposing significant changes to Ukraine’s transfer pricing rules. The draft law aims to align Ukrainian rules more closely with OECD and EU standards. The proposed amendments include applying the arm’s length principle to certain domestic related-party transactions, clarifying the use of TP methods, introducing a revised penalty framework, and updating the approach to financial transactions and DEMPE analysis (for intangibles). The new rules are expected to apply from 1 January 2028.
Thank you for taking the time to read this edition of our newsletter. I hope you found the insights and updates valuable. Do you have any questions or need further information? Contact us today to get expert advice on worldwide transfer pricing matters and developments.
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Best regards,
Adriaan van der Heijden
Partner at Quantera Global
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In this edition of the newsletter, you will find the most important national and global developments in tax law that are (closely) related to the transfer pricing world. Please feel free to contact us if you have any questions. Quantera Global news, developments, and blogs Would you like to know more about our international alliance network? Visit our website here, where you […]
