Tag: Example – Limited risk distributor (Pharma)

TPG2022 Chapter VI Annex I example 7

TPG2022 Chapter VI Annex I example 7

/ Actual transaction, Delineation, Digital Economy, Example - Limited risk distributor (Pharma), Limited Risk Distributors (LRD), OECD Transfer Pricing Guidelines (2022), Risk actually assumed, TPG2022 Annex I to Chapter VI – Examples on Intangibles
16. Primero is the parent company of an MNE group engaged in the pharmaceutical business and does business in country M. Primero develops patents and other intangibles relating to Product X and registers those patents in countries around the world. 17. Primero retains its wholly owned country N subsidiary, Company S, to distribute Product X throughout Europe and the Middle East on a limited risk basis. The distribution agreement provides that Primero, and not Company S, is to bear product recall and product liability risk, and provides further that Primero will be entitled to all profit or loss from selling Product X in the territory after providing Company S with the agreed level of compensation for its distribution functions. Operating under the contract, Company S purchases Product X from Primero and resells Product X to independent customers in countries throughout its geographical area of operation. In performing its distribution functions, Company S follows all applicable regulatory requirements. 18. In the ... Read more
TPG2017 Chapter VI Annex example 7

TPG2017 Chapter VI Annex example 7

/ Actual transaction, Delineation, Digital Economy, Example - Limited risk distributor (Pharma), Limited Risk Distributors (LRD), OECD Transfer Pricing Guidelines (2017), Risk actually assumed
16. Primero is the parent company of an MNE group engaged in the pharmaceutical business and does business in country M. Primero develops patents and other intangibles relating to Product X and registers those patents in countries around the world. 17. Primero retains its wholly owned country N subsidiary, Company S, to distribute Product X throughout Europe and the Middle East on a limited risk basis. The distribution agreement provides that Primero, and not Company S, is to bear product recall and product liability risk, and provides further that Primero will be entitled to all profit or loss from selling Product X in the territory after providing Company S with the agreed level of compensation for its distribution functions. Operating under the contract, Company S purchases Product X from Primero and resells Product X to independent customers in countries throughout its geographical area of operation. In performing its distribution functions, Company S follows all applicable regulatory requirements. 18. In the ... Read more