Contributions to a CCA may take many forms. For services CCAs, contributions primarily consist of the performance of the services. For development CCAs, contributions typically include the performance of development activities (e.g. R&D, marketing), and often include additional contributions relevant to the development CCA such as pre-existing tangible assets or intangibles. Irrespective of the type of CCA, all contributions of current or pre-existing value must be identified and accounted for appropriately in accordance with the arm’s length principle. Since the value of each participant’s relative share of contributions should accord with its share of expected benefits, balancing payments may be required to ensure this consistency. The term “contributions” as used in this Chapter includes contributions of both pre-existing and current value made by participants to a CCA.
TPG2022 Chapter VIII paragraph 8.24
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By OECD
Category: OECD Transfer Pricing Guidelines (2022), TPG2022 Chapter VIII: Cost Contribution Arrangements | Tag: Balancing payments, CCA/CSA, Cost Contribution Arrangement (CCA), Cost Sharing Arrangement (CSA), Current value, Pre-existing intangibles, Value of contributions
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