On 27 February 2021 UN released a new 2021 Practical Manual on Transfer Pricing.
“…this third edition of the Manual makes improvements in usability and practical relevance, updates and improves the existing text, including on Country Practices (Part D) and has new content, in particular, on financial transactions, profit splits, centralized procurement functions and comparability issues. Improved capacity development based on the Manual has encouraged and contextualized developing country feedback, helped identify these priority areas for improvement and contributed to better targeting the messages in the Manual and examples used.”
The changes in the new edition of the Manual include:
• A revised format and a rearrangement of some parts of the Manual for clarity and ease of understanding, including a reorganization into four parts as follows:
– Part A relates to transfer pricing in a global environment;
– Part B contains guidance on design principles and policy considerations; this Part covers the substantive guidance on the arm’s length principle, with Chapter B.1. providing an overview, while Chapters B.2. to B.7. provide detailed discussion on the key topics. Chapter B.8. then demonstrates how some countries have established a legal framework to apply these principles;
– Part C addresses practical implementation of a transfer pricing regime in developing countries; and
– Part D contains country practices, similarly to Chapter 10 of the previous edition of the Manual. A new statement of Mexican country practices is included and other statements are updated;
• A new chapter on intra-group services;
• A new chapter on cost contribution arrangements;
• A new chapter on the treatment of intangibles;
• Significant updating of other chapters; and
• An index to make the contents more easily accessible.