OECD COVID-19 TPG paragraph 85

« | »

The materiality of the change in economically relevant circumstances created by the impact of government assistance available in a market may impose additional challenges to the comparability analysis. It may for example render it more difficult to apply the comparability analysis through the utilisation and/or the application of a particular transfer pricing method and search for comparable transactions, on the basis that comparability differences may be exacerbated due to variations in government assistance between comparables or between jurisdictions.40 For example, an uncontrolled transaction that might otherwise have been considered comparable to a particular controlled transaction might be considered not comparable by virtue of the fact that one of the transactions is subject to government assistance while the other is not. A revised strategy, and potentially the use of a corroborating transfer pricing methodology,41 may need to be applied in such cases to take account of the differences in comparability. See Chapter II of this guidance.

40 As the guidance in paragraph 2.143 of the OECD TPG indicates, the lack of comparables alone is insufficient to warrant the use of a transactional profit split.

41 In considering the use of more than one method, the guidance in paragraph 2.12 of the OECD TPG should be followed in any case.

Related Guidelines