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Transfer Pricing in a Pandemic – Lessons from China

Intercompany Agreements

6 April 2020

It has been very encouraging to receive the news from Xiaofang’s family and from our friends that life in China is starting to open up again. Her parents are now busy in her grandmother's vegetable garden in the countryside near Xinzheng (having been allowed to leave the family home in the city), local schools in Henan have reopened for A-level equivalent students, friends in Wuhan are back to work in their offices, and restaurants in places like Shanghai have opened their doors and are serving customers once more. Hopefully we in the rest of the world are just a couple of months behind, although personally I think we all have at least 6 months of semi restricted mobility to look forward to.

Here’s a link to an excellent article on some of the thought processes for reviewing transfer pricing policies and intercompany agreements for multinational groups, specifically in the context of recent experiences in China and the effect of force majeure clauses:

Transfer Pricing in a Pandemic - Lessons From China

If you would like help in working through these issues, please let us know. Using our 'traffic light' reporting framework, we can provide a clear and succinct picture of issues requiring action in order to adapt the legal implementation of each group's transfer pricing. As always, we are very happy to have an initial conversation without obligation or commitment. To arrange a call, just reach out to your usual LCN Legal contact, or email us at info@lcnlegal.com.

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Article by
Paul Sutton
LCN Legal Co-Founder

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