Following an audit, the tax authorities found that the transfer prices used by Oleaginosa Oeste SA for the export of agricultural commodities (soya bean oil and sunflower seed oil) to a related party in Switzerland were not at arm’s length.
Oleaginosa Oeste SA appealed and the Tax Court partially annulled the assessment. This decision was later upheld by the Court of Appeal.
The tax authorities then appealed the decision to the Supreme Court.
Judgment of the Supreme Court.
The Supreme Court partially overturned the decision of the lower court and remitted the case for reconsideration.
The Court considered that the question of whether the transactions were sufficiently comparable for the application of the CUP method was of a factual and evidentiary nature and should be resolved by the judges.
The Court found that the previous instances had not adequately addressed the lack of reliable evidence provided by Oleaginosa Oeste SA regarding the date of the sales to the related party in Switzerland, which led it to establish prices based on the date of invoicing.
Click here for English Translation
Click here for other translation