A lack of closely comparable, uncontrolled transactions which would otherwise be used to benchmark an arm’s length return for the party performing the less complex functions should not per se lead to a conclusion that the transactional profit split is the most appropriate method. Depending on the facts of the case, an appropriate method using uncontrolled transactions that are sufficiently comparable, but not identical to the controlled transaction is likely to be more reliable than an inappropriate use of the transactional profit split method. See paragraphs 3.38–3.39 for a discussion of limitations in available comparables. See also section C.2.3.
TPG2018 Chapter II paragraph 2.128
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By OECD
Category: OECD Transfer Pricing Guidelines (2017) | Tag: Inappropriate use of method, Lack of comparables, Profit split method (PSM), Sufficiently comparable, Transfer pricing methods
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