OECD Transfer Pricing Guidelines update

by Maria Ström & Victor Elovsson


Futuristic staircase

OECD recently published the 2022 edition of the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, which includes updates and additions to the 2017 version.

The OECD guidelines are an internationally accepted source of interpretation which provide guidance on the application of the “arm’s length principle”. The guidelines enable governments to ensure that the taxable profits of multinational enterprises are not transferred out of their jurisdiction, and that the tax base reported reflects the economic activity undertaken. For taxpayers, the guidelines give clear guidance on the proper application of the arm’s length principle which is essential to limit the risks of economic double taxation.

The new updated edition includes:

  • revised guidance on the application of the transactional profit method;

  • guidance for tax administrations on the application of the approach to hard-to-value intangibles agreed in 2018;

  • new transfer pricing guidance on financial transactions approved in 2020; and

  • consistency-changes to the rest of the OECD Transfer Pricing Guidelines.

The update does not contain new instructions but is a compilation of previously published reports into a single publication.

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