A recent newsletter from Richard Tromans’ Artificial Lawyer blog (which is well worth subscribing to, by the way) reports on a study by the Massachusetts Institute of Technology which found that a lot of contracts drafted by lawyers are hard to read.
I don’t think anyone would seriously argue with that.
The same criticism might possibly apply to transfer pricing policies and tax advice notes.
Of course, it’s easy to get all holier-than-thou, and protest that our drafting is always clear, unambiguous and to the point. Which is something we’re all passionate about at LCN Legal, especially as regards intercompany agreements.
It’s also easy to bring out the excuses, when we fall short of the mark. ‘It was a rush job.’ ‘We’re just using standard wording that everyone understands.’ ‘It’s market standard.’ ‘Blame it on the OECD’ et cetera et cetera.
But ultimately, contracts, transfer pricing policies and economic analysis for TP have one thing in common: they have little value, unless they communicate the relevant message in a precise way that people can easily understand. It makes no difference if you're 'right', if you haven't expressed yourself clearly.
In other words, the communication is the product.
Do you agree?
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