Panama vs “Glass Corp”, February 2020, Administrative Tribunal, Case No TAT-RF-015

Category: Transfer Pricing Documentation | Tag: ,
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“Glass Corp” Panama, was issued a fine for not filing (in time) Transfer Pricing Report – Form 930 – for the fiscal year 2012.

Article 762-I of the Tax Code in Panama establishes that failure to comply with filing obligation of transfer pricing documentation results in a fine of 1% of the total amount of the transactions with related parties.

The decision of the Court

“since it has been demonstrated that the formal duty to submit the Transfer Pricing Report contained in Article 762-I of the Tax Code has not been fulfilled by the company, this Administrative Tribunal considers that it is appropriate to confirm Resolution No. 201-579 of 15 October 2014 and the administrative act by which the General Revenue Directorate resolves to maintain it in all its parts.“

Click here for English translation

Panama Exp. 176-18





Related Guidelines

  1. TPG2022 Chapter V paragraph 5.38In order to simplify compliance burdens on taxpayers, tax administrations may determine, as long as the operating conditions remain unchanged, that the searches in databases for comparables supporting part of the local file be updated every three years rather than annually. Financial data...
  2. TPG2022 Chapter V paragraph 5.28Taxpayers should not be expected to incur disproportionately high costs and burdens in producing documentation. Therefore, tax administrations should balance requests for documentation against the expected cost and administrative burden to the taxpayer of creating it. Where a taxpayer reasonably demonstrates, having regard...
  3. TPG2022 Chapter V paragraph 5.9While ideally taxpayers will use transfer pricing documentation as an opportunity to articulate a well thought-out basis for their transfer pricing policies, thereby meeting an important objective of such requirements, issues such as costs, time constraints, and competing demands for the attention of...
  4. TPG2022 Chapter V paragraph 5.40Many countries have adopted documentation-related penalties to ensure efficient operation of transfer pricing documentation requirements. They are designed to make non-compliance more costly than compliance. Penalty regimes are governed by the laws of each individual country. Country practices with regard to transfer pricing...
  5. TPG2022 Chapter V paragraph 5.26Annex III to Chapter V of these Guidelines contains a model template for the Country-by-Country Report together with its accompanying instructions....
  6. TPG2022 Chapter V paragraph 5.13A third objective for transfer pricing documentation is to provide tax administrations with useful information to employ in conducting a thorough transfer pricing audit. Transfer pricing audit cases tend to be fact-intensive. They often involve difficult evaluations of the comparability of several transactions...
  7. TPG2022 Chapter V paragraph 5.7By requiring taxpayers to articulate convincing, consistent and cogent transfer pricing positions, transfer pricing documentation can help to ensure that a culture of compliance is created. Well-prepared documentation will give tax administrations some assurance that the taxpayer has analysed the positions it reports...
  8. TPG2022 Chapter V paragraph 5.8This compliance objective may be supported in two important ways. First, tax administrations can require that transfer pricing documentation requirements be satisfied on a contemporaneous basis. This would mean that the documentation would be prepared at the time of the transaction, or in...
  1. WCO Guide to Customs Valuation and Transfer PricingIn June 2015 the World Customs Organization (WCO) published a guide to Customs Valuation and the relationship to Transfer Pricing. This relationship between Customs valuation and transfer pricing has been discussed in various national and international fora over the past few years. The...
  2. September 2017: Handbook on Effective Tax Risk Assessment using CbC ReportsThe Handbook on Effective Tax Risk Assessment explores how information contained in CbC reports can be used for risk assessment and which types of tax risk indicators that may be identified using the information contained in CbC Reports. In chapter 4 some of...

Related Case Law

  1. Spain vs Representaciones Creta S.L., October 2018, Tribunal Supremo, Case No 1504/2018, STS 3632/2018 – ECLI:ES:TS:2018:3632Tax penalties/fines had been issued following a transfer pricing adjustments in regards of controlled transactions exempt from Spanish TP documentation requirements. An appeal was filed by the taxpayer claiming to be excluded from the Spanish penalty regime. The appeal was dismissed by the...
  2. Greece vs S.p.A. ST. MEDICAL, May 2020, Supreme Administrative Court, Case No A 985/2020Following an audit the tax authorities issued a tax assessment and a substantial fine to S.p.A. ST. MEDICAL related to costs deducted in FY 2010, which the tax authorities claimed were partially fictitious. “the Economic Police carried out, on 22.10.2012, a tax audit...
  3. Spain vs Stavelot Comunicación S.L., May 2020, Tribunal Supremo, Case No 446/2020, STS 951/2020 – ECLI:EN:TS:2020:951In the case at hand a related-party transactions had been carried out between a person (shareholder) and a related company. The transaction took place in 2007 and 2008 and was exempt from Spanish transfer pricing documentation requirements. The tax authorities issued an assessment...
  4. Spain vs ICL ESPAÑA, S.A. (Akzo Nobel), March 2018, Audiencia Nacional, Case No 1307/2018 ECLI:ES:AN:2018:1307ICL ESPAÑA, S.A., ICL Packaging Coatings, S.A., were members of the Tax Consolidation Group and obtained extraordinary profits in the financial years 2000, 2001 and 2002. (AKZO NOBEL is the successor of ICL ESPAÑA, as well as of the subsidiary ICL PACKAGING.) On...