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How to give your intra-group distributors and service providers a coronavirus haircut

Intercompany Agreements

20 April 2020

Last week the gods of Amazon smiled down on me and answered my prayer for new hair clippers. So on Friday I entrusted them to Xiaofang, and I think she did a pretty good job in the kitchen, as you can see from the picture above.

In the transfer pricing world, many multinational enterprises are considering giving their local intra-group sales entities and service providers a 'coronavirus haircut'. Various of the transfer pricing professionals we work alongside globally have asked for guidance on force majeure clauses and other legal considerations which may be relevant in these circumstances. We've tried to express the key points in an article on force majeure clauses and related issues. The article provides an overview for transfer pricing and tax professionals on:

  • force majeure clauses, how to read them and what impact they have in practice;
  • other legal grounds which may potentially entitle a party to terminate an intercompany agreement or suspend performance; and
  • a suggested framework for considering the revision of intercompany agreements from a wider legal perspective.

You can read the article here.

If there's anything you feel we haven't covered that would be helpful, please let me know and we'll do our best to oblige.

Article by
Paul Sutton
LCN Legal Co-Founder

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