Simplification in transfer pricing: a plea for the enactment of rebuttable predetermined margins and methods within developing countries Articles uri icon



publication date

  • December 2019

start page

  • 755

end page

  • 788


  • 3


  • 22

International Standard Serial Number (ISSN)

  • 1066-3487


  • It is the aim of this contribution to sustain that, despite the inherent complexity that the enforcement of the arm's length rationale entails, it is
    feasible-and desirable-to introduce simplification measures without
    abandoning this worldwide accepted standard, especially in the context
    of developing countries and despite reticence shown by international
    organizations such as the OECD. Complexity in transfer pricing erodes
    fairness and equity and promotes profit shifting, which paradoxically
    constitutes the opposite outcome that this set of rules wants to achieve.
    This is the reason why it is urgent to propose and encourage the adoption of a means to neutralize unnecessary complexity in this field. The
    adoption of rebuttable predetermined margins and/or methods is proposed as the best solution in a context in which policymakers want to
    keep the arm's length rationale intact. Also, even despite its shortcomings, irrebuttable predetermined safe harbors should be considered
    potentially feasible and a valid policy option.


  • Law