For most multinational businesses, there are 4 or 5 types of intercompany transaction which are key to delineating the relationship between group companies, from a governance and transfer pricing perspective. Each of those types of transaction needs a ‘master template’ intercompany agreement (ICA), to map out the allocation of risk and reward, rights and duties – otherwise there’s no clear reference point for comparability analysis for TP purposes.
Sometimes the draft TP analysis precedes the ICAs, and sometimes it’s the other way around. Where the draft TP work comes first, then the job of the lawyers like us is to analyse the draft TP documentation and identify the key ICA templates required.
Here’s a simple tool for this kind of analysis which you might find helpful:
N.B. We’re holding a free webinar on 16 October, which is specifically for legal counsel within multinational groups, to give them a crash course on how to prepare intercompany agreements for transfer pricing compliance. You can find out more and reserve your place here. Please also feel free to send on this invitation to anyone who you think might find it useful.