Particular labels or descriptions assigned to financial transactions do not constrain the transfer pricing analysis. Each situation must be examined on its own merits, and subject to the prefatory language in the previous paragraph, accurate delineation of the actual transaction under Chapter I will precede any pricing attempt.
TPG2020 Chapter X paragraph 10.11
Category: B. Interaction with the guidance in Section D.1 of Chapter I, B.1. Determination of whether a purported loan should be regarded as a loan, OECD Transfer Pricing Guidelines (2017), TPG2020 Chapter X: Financial Transactions | Tag: Accurate delineation, Equity or Debt/Loan, Financial transactions, Labels
« Prev |
Next » Related Guidelines
- TPG2022 Chapter X paragraph 10.11Particular labels or descriptions assigned to financial transactions do not constrain the transfer pricing analysis. Each situation must be examined on its own merits, and subject to the prefatory language in the previous paragraph, accurate delineation of the actual transaction under Chapter I...
- TPG2022 Chapter X paragraph 10.128As with many types of financial transactions, different intent and understanding can be ascribed to the labels or descriptions attached to particular transactions. Each case must be considered on its own facts and circumstances and in each case accurate delineation of the actual...
- TPG2022 Chapter X paragraph 10.12In accurately delineating an advance of funds, the following economically relevant characteristics may be useful indicators, depending on the facts and circumstances: the presence or absence of a fixed repayment date; the obligation to pay interest; the right to enforce payment of principal...
- TPG2022 Chapter X paragraph 10.10Although countries may have different views on the application of Article 9 to determine the balance of debt and equity funding of an entity within an MNE group, the purpose of this section is to provide guidance for countries that use the accurate...
- TPG2022 Chapter X paragraph 10.6In the context of the preceding paragraphs, this subsection elaborates on how the concepts of Chapter I, in particular the accurate delineation of the actual transaction under Section D.1, may relate to the balance of debt and equity funding of an entity within...
- TPG2022 Chapter X paragraph 10.23In accurately delineating the actual financial transaction, a functional analysis is necessary. This analysis seeks to identify the functions performed, the assets used and the risks assumed by the parties to that controlled transaction....
Related Case Law
- Israel vs The Barzani Brothers (1974) Ltd., Oktober 2020, Jerusalem Court of Appeal, Case No 54727-02-17The Barzani Brothers (1974) Ltd had provided interest-free financing to affiliated Romanian group companies in the form of “capital notesâ€. In Israel, financing qualifying as a “capital note†releases the lender from having to report interest income in its annual tax return in...
- Norway vs Petrolia Noco AS, May 2022, Court of Appeal, Case No LB-2022-18585In 2011, Petrolia SE established a wholly owned subsidiary in Norway – Petrolia Noco AS – to conduct oil exploration activities on the Norwegian shelf. From the outset, Petrolia Noco AS received a loan from the parent company Petrolia SE. The written loan...