Governments have also provided broader financial and liquidity supports to ensure enterprises can continue to operate through the period of reduction in business activity. Those include: (i) loan guarantees; (ii) direct financing to business on preferential terms; (iii) loan deferrals; (iv) specific grants and (v) tax relief.
OECD COVID-19 TPG paragraph 63
Category: TPG2020 Guidance on the transfer pricing implications of the COVID-19 | Tag: COVID-19, Government assistance, Government interventions
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- OECD COVID-19 TPG paragraph 60Government assistance is a monetary or non-monetary programme where a government or other public authority provides a direct or indirect economic benefit to eligible taxpayers such as grants, subsidies, forgivable loans, tax deductions, or investment allowances. For example, a government may directly subsidise...
- OECD COVID-19 TPG paragraph 61During the COVID-19 pandemic, governments’ overriding concern has been public health and controlling the spread of the virus while at the same time trying to help enterprises manage the impact of the decline of business activity and workers facing a decline in employment...
- OECD COVID-19 TPG paragraph 82The comparability of open market transactions or enterprises may be influenced by the receipt of government assistance, affecting both how the parties establish their commercial or financial relations and how they price their transactions. Therefore, when performing a comparability analysis, it may be...
- OECD COVID-19 TPG paragraph 91Generally, the APA itself will explicitly describe what constitutes a situation of non-compliance or failure to meet a critical assumption, as well as the consequences arising from it. Also, domestic law or procedural provisions may also impose consequences or obligations on the taxpayer...
- OECD COVID-19 TPG paragraph 98In some circumstances, it may be possible to retain some of the terms set out in an APA, but revise specific provisions for which the breach in the critical assumptions is relevant. For example, an APA may cover a series of controlled transactions...
- OECD COVID-19 TPG paragraph 59In response to COVID-19, some taxpayers may seek to assert force majeure in situations where it is not contained within the relevant intercompany agreement (assuming here that the law governing the contract is not a civil law jurisdiction where force majeure would automatically...
- OECD COVID-19 TPG paragraph 11In principle, any form of publicly available information regarding the effect of COVID-19 on the business, industry and controlled transaction may be relevant in ascertaining the arm’s length nature of an enterprise’s transfer pricing policy implemented for FY 2020. The following sources of...
- OECD COVID-19 TPG paragraph 1The impact of coronavirus (“COVID-19â€) has been profound. The rapid spread of the virus has strained local medical infrastructures, led to restrictions on travel and social contact, and created unprecedented disruptions to the global economy....
- Report on the Application of Economic Valuation Techniques (2017)The Study on the Application of Economic Valuation Techniques for Determining Transfer Prices of Cross Border Transactions between Members of Multinational Enterprise Groups in the EU provides an overview on how valuation techniques can practically and most efficiently be used for transfer pricing...
- United Arab Emirates issues comprehensive Transfer Pricing Guide23 October 2023, the United Arab Emirates issued a comprehensive practical Transfer Pricing Guide. The guide is designed to provide general guidance on the Transfer Pricing regime in the UAE with a view to making the provisions of the Transfer Pricing regulations as...
Related Case Law
- Denmark vs EAC Invest A/S, October 2021, High Court, Case No SKM2021.705.OLRIn 2019, the Danish parent company of the group, EAC Invest A/S, had been granted a ruling by the tax tribunal that, in the period 2008-2011, due to, inter alia, quite exceptional circumstances involving currency restrictions in Venezuela, the parent company should not...