Tag: Invoicing center

TPG2022 Chapter VI Annex I example 21

TPG2022 Chapter VI Annex I example 21

/ Advertising, Control over risk, DEMPE, DEMPE functions, Funding, Funding without risk, Invoicing center, Legal owner, No control over risk, OECD Transfer Pricing Guidelines (2022), Regional HQ, Sales and marketing hubs, TPG2022 Annex I to Chapter VI – Examples on Intangibles, Trademark (trade name), Trading hub
73. Första is a consumer goods company organised and operating in country A. Prior to Year 1, Första produces Product Y in country A and sells it through affiliated distribution companies in many countries around the world. Product Y is well recognised and attracts a premium compared to its competitors, to which Första is entitled as the legal owner and developer of the trademark and related goodwill giving rise to that premium. 74. In Year 2, Första organises Company S, a wholly owned subsidiary, in country B. Company S acts as a super distributor and invoicing centre. Första continues to ship Product Y directly to its distribution affiliates, but title to the products passes to Company S, which reinvoices the distribution affiliates for the products. 75. Beginning in Year 2, Company S undertakes to reimburse the distribution affiliates for a portion of their advertising costs. Prices for Product Y from Company S to the distribution affiliates are adjusted upward so ... Read more
TPG2017 Chapter VI Annex example 21

TPG2017 Chapter VI Annex example 21

/ Control over risk, Invoicing center, No control over risk, OECD Transfer Pricing Guidelines (2017), Regional HQ, Sales and marketing hubs, Trading hub
73. Första is a consumer goods company organised and operating in country A. Prior to Year 1, Första produces Product Y in country A and sells it through affiliated distribution companies in many countries around the world. Product Y is well recognised and attracts a premium compared to its competitors, to which Första is entitled as the legal owner and developer of the trademark and related goodwill giving rise to that premium. 74. In Year 2, Första organises Company S, a wholly owned subsidiary, in country B. Company S acts as a super distributor and invoicing centre. Första continues to ship Product Y directly to its distribution affiliates, but title to the products passes to Company S, which reinvoices the distribution affiliates for the products. 75. Beginning in Year 2, Company S undertakes to reimburse the distribution affiliates for a portion of their advertising costs. Prices for Product Y from Company S to the distribution affiliates are adjusted upward so ... Read more