USCIB Comments on OECD Intangibles Project

At the end of September, the taxation committee of the United States Council for International Business (USCIB) issued its comments on the scope of the OECD’s project on the transfer pricing aspects of intangibles. The OECD had released a scoping document for this project in January of this year. The USCIB comments largely focused on the definition of intangibles, as well as the distinction between intangibles and services.
The USCIB paper (the “paper”) distinguishes between owned and controlled intangible property. The former includes any asset “in which a person can hold a legally cognizable (and protectable) right”, such as patents or copyrights. Controlled intangible assets may not be eligible for the same type of legal protection, even though such protection is afforded anyway in most countries, and include such items as supply contracts and customer lists. When intangible asset ownership is transferred among related parties, either fully or partially (e.g., through a license), transfer pricing rules should be applied in order to determine arm’s length compensation.
The USCIB contrasts these definitions with certain “business attributes or notions” which may cause the value of a business, or line of business, to exceed (or trail) that of its component parts (tangible and intangible). This residual value can be characterized as goodwill or going concern value, and may be due to workforce in place, existence of a global network, synergies, or other factors that cannot be easily or meaningfully separated from the business as a whole, or attributed to identifiable intangible assets. The USCIB argues that such attributes cannot be transferred, between either related or unrelated parties, and are therefore not subject to transfer pricing rules.
A related discussion pertains to the possible general definition of an intangible asset as “something of value”. The paper notes that such a definition could fit a situation where business risk is transferred from one related party to another (e.g., a full-service distributor is converted to limited risk). The party bearing the additional risk might then reasonably expect to realize higher average profits, so that the assumed risk may be seen as providing a certain value. However, the paper argues that this would not constitute a transfer of an intangible, and should not be compensated as such, since the expected increase in profitability is due to the assumption and skillful management of the risk, as opposed to any specific property transferred between the two entities. (Of course, should one party assume risk from another by providing insurance protection, it would be due compensation for that protection. However, this would not be a transfer of an intangible.)
Finally, the USCIB paper downplays the need to distinguish between the transfer of intangibles and the provision of services. A provider of high-value services can make use of intangibles, and this may impact the market value of the services, but it does not necessarily mean that any ownership in those intangible assets is being transferred. For that to happen, the recipient would have to receive rights to exploit valuable assets that it does not own for a defined period of time.
The USCIB comments touch on important definitional and conceptual issues with respect to intangible assets and their transfer pricing treatment. Practitioners, taxpayers, and tax authorities will be following the progress of the OECD project with great interest.

Source: Ceteris Transfer Pricing Times Volume VIII, Issue 10

La viñeta del día

Potential Arbitration under MAP Cases

An increasing number of countries have included arbitration procedures in tax treaties to encourage competent authorities to resolve transfer pricing disputes in a timelier manner. The US, for example, currently has bilateral tax treaties with Belgium, Canada, France, Germany, Ireland, Italy, Mexico, the Netherlands and Switzerland that all include arbitration provisions. Its agreements with Belgium, Canada, France and Germany provide for baseball-style arbitration, which is an “all or nothing” process requiring the independent arbitration panel to select the complete proposal of only one country and to reject the other.

The prospect of binding arbitration has already begun to impact tax authority and taxpayer practices with respect to potential disputes:

• In July 2011, the IRS announced that it was combining its APA program with Competent Authority to form the Advanced Pricing and Mutual Agreement program (see Ceteris Transfer Pricing Times Volume VIII, Issue 9). IRS Transfer Pricing Director Sam Maruca has indicated that the biggest emerging issue facing the IRS is arbitration.
• Canada Revenue Agency (CRA) head of the International and Large Business Directorate, Lucie Bergevin, has stated that the arbitration provisions in the US-Canada treaty have resulted in more communication between the taxing authorities. She has witnessed an increase in the number of meetings and telephone conferences held between the US and Canada competent authority representatives, along with better monitoring of the deadlines for receipt of information requested from taxpayers involved in live cases.
• A recent survey was conducted by the BNA International Transfer Pricing Forum of leading tax practitioners within OECD countries. Practitioners from Canada believe that there is increasing incentive for Canadian and US officials to arrive at mutual agreement rather than leave the decision to an arbitration panel, which creates risk for both sides that the panel will reject either proposal. (See related article in Ceteris Transfer Pricing Times Volume VIII, Issue 1)
• H.M. Revenue and Customs Permanent Secretary for Tax David Harnett has indicated that although some countries have reported to the OECD that they are able to settle transfer pricing cases within 12 months, the average for all cases is 540 days. Harnett signaled that a report to be released by the OECD will probably recommend the use of alternative dispute resolution techniques earlier in the process for transfer pricing inquiries that have the potential to turn into lengthy disputes.

One potential downside is that APA programs may become more selective in the cases that they take on so as to avoid those which will be difficult to resolve within the period required to avoid arbitration. Transfer pricing specialists have noted that such a trend would be at odds with the original purpose of the APA program as an avenue where complex transfer pricing issues could be resolved in advance of an audit.

Source: Ceteris Transfer Pricing Times Volume VIII, Issue 10

Nuevas publicaciones de la OCDE en materia fiscal

OECD Tax Policy Studies Taxation and Employment This publication examines the effects of taxation on employment, highlights the resulting policy challenges, and discusses the ways governments endeavour to address these challenges. Now available from the Online Bookshop. Other reports in the series: OECD Tax Policy Studies.

 

OECD Tax Statistics 2011 on CD-ROM, Volume I, Revenue Statistics This annual Cd-ROM presents a unique set of detailed and internationally comparable tax data in a common format for all OECD countries from 1965 onwards according to a conceptual framework defining which government receipts should be regarded as taxes and classifying different types of taxes. Now available on CD-Rom from the Online Bookshop.

Developments in US Penalties

In September, the IRS disbanded its transfer pricing penalty oversight committee. In an interview with BNA Tax Management in August, Samuel Maruca, IRS Transfer Pricing Director, said the committee had served its purpose and that “awareness levels are such that we are able to deal with the issue or any issues that arise on a case-by-case basis through normal procedure without the necessity of the committee.”
The oversight committee was created in 1994 to review all transfer pricing penalties under Internal Revenue Code Sections 6662(e) and (h). Documentation requirements under Section 6662 subject taxpayers with transfer pricing adjustments to potential penalties of 20 percent and 40 percent of tax underpayments, depending on the size of the adjustment, in the absence of adequate and timely documentation. With the dissolution of the committee, penalties no longer require review, and International Territory Managers no longer need to forward concurrence on any cases where the penalty threshold is met and a penalty is not being assessed.
Practitioners have raised concerns over the dissolution of the committee because they believe it provided a necessary check on the international examiners, ensuring penalties are only asserted in well-developed cases. Without the committee, penalty authority rests more squarely with the international examiners. However, there is also evidence that the committee might have become something of a rubber stamp. The number of cases brought before it had recently trended downward. This may be the result of emerging consensus within the IRS (and perhaps with taxpayers as well) regarding situations in which transfer pricing penalties are applicable. For the fiscal year ended September 30, 2010, penalties under Section 6662(e) or (h) were upheld by the committee for all 19 tax years in which examiners recommended them, according to statistics released by the IRS in August. Similarly, in 2009, auditors recommended penalties for 25 tax years and the committee approved them all. Penalties both submitted to and approved by the oversight committee reached an all-time high in 2006, when the committee approved them in 54 of 55 tax years for which they were recommended.

Source: Ceteris Transfer Pricing Times Volume VIII, Issue 9

OECD discussion draft on Article 5 (Permanent Establishment) of the OECD Model Tax Convention

The OECD has recently published a public discussion draft entitledInterpretation and Application of Article 5 (Permanent Establishment) of the OECD Model Tax Convention. The discussion draft proposes a number of changes affecting the application of the treaty rules which deal with the circumstances in which a taxable presence or ‘permanent establishment’ may be created.

Source and more info: PwC's Tax Policy Bulletin

Discussion draft on interpretation and application of article 5 of OECD Model Tax Convention

On 12 October 2011, the OECD Committee on Fiscal Affairs (CFA) released for public discussion a draft including recommendations on the interpretation and application of article 5 (Permanent establishment) of the OECD Model Convention . The recommendations were made by a Working Group composed of delegates to Working Party 1 on Tax Conventions and Related Questions of the CFA. The Working Group examined various issues related to the definition of permanent establishment (PE) that had been identified in previous work of the Committee, such as the work on business restructurings and on the application to electronic commerce of the current treaty rules for the taxation of business profits. 

A summary of the main issues identified by the Working Group, as well as related recommendations, which in most cases includes proposed changes to the Commentary on article 5, is included below. 

Commentary to article 5(1) 

The Working Group analysed the meaning of "at the disposal of" used in the Commentary to explain the concept of "place of business". The proposed changes to the Commentary clarify that when examining whether a location is at the disposal of the enterprise, the extent of the presence of the enterprise in that location and the activities it performs there are relevant. For example, when an enterprise has an exclusive legal right to use a particular location for carrying on its activities, or when it performs activities on a continuous and regular basis for an extended period of time at a location that belongs to another enterprise or that is used by a number of enterprises, such location is considered to be at its disposal. 

This should not be the case if the enterprise's presence there is so intermittent or incidental that the location cannot be considered a place of business of the enterprise or in the case the enterprise does not have a right to be present at a location and in fact does not use that location itself. 

Also related to the meaning of "at the disposal of", the Working Party proposed the addition of new paragraphs to the Commentary which would address the issue of whether an individual's home office would constitute a PE for the enterprise for which the individual works. 

The time requirement for which an activity should be continuously performed before a PE would be created was also analysed. While the proposals regarding the introduction of a prescribed time frame similar to the one in article 15 were not adopted, the Working Group decided that this matter would be clarified by including in the Commentary two examples on the exceptions mentioned at the end of the existing paragraph 6 of the Commentary, addressing (i) activities of a recurrent nature and (ii) a business carried on for a short duration that would meet the time requirement for a PE. 

A matter previously discussed by the Joint Working Group on Business Restructurings in relation to associated enterprises is the circumstance under which the presence in a country of personnel of a foreign enterprise might constitute a PE for the foreign enterprise. Reference to paragraph 8.11 of the Commentary on article 15 was included in the draft Commentary to article 5, pointing out that there may be cases where individuals formally employed by an enterprise will actually carry on the business of another enterprise, without the first enterprise being considered to carry on its own business at the location where these individuals perform that work. 

The issue of whether a main contractor has a PE in case it subcontracts all aspects of a contract to other enterprises was also addressed, the draft Commentary stating that this should be the case if the other conditions of article 5 are met. 

Another question raised by the Working Party refers to whether and in which circumstances a company which is a member of a corporate group constitutes a "place of management" of another group company so as to constitute a PE. 

Commentary to article 5(3) 

The application of paragraph 3 to the activities carried on through a joint venture and partnership was also discussed. The proposed changes to the Commentary clarify that, whereas for the purpose of determining whether a construction site constitutes a PE the time threshold is applied at the level of the partnership, the taxation of the profits of the partnership attributable to each partner depends on the specific time threshold included in the treaty with the country of residence of the partner. 

Clarifications regarding the extent to which additional work performed on a construction site is considered for the application of paragraph 3 were included. As such, the period during which the building or facilities are tested should be taken into consideration, while the works undertaken pursuant to a guarantee should not be accounted for. 

Commentary to article 5(5) 

In light of the recent court decisions on "commissionnaire" arrangements in France (Zimmer Ltd.) and Norway (Dell DUF), the Working Group discussed the meaning of "to conclude contracts in the name of the enterprise". An example of a situation where a foreign principal would be bound by a contract even though the contract would not be concluded in his name was included in the Commentary. 

Other matters 

PE implications of venture capital funds, as raised by representatives of the European Venture Capital Association, were also discussed. The Working Group concluded that no specific guidance could be provided, thus no amendments were proposed to the existing Commentary in this regard. 

The Committee invites public comments on the proposed changes before they are discussed by the Working Party at its meeting at the end of February 2012. It is also intended that Working Party 6 on the Taxation of Multinational Enterprises will be invited to consider any potential issue related to article 7 that may arise from the proposals included in the discussion draft.

Source: IBFD's TNS On-line

OECD Report on Corporate Loss Utilisation through Aggressive Tax Planning

On 30 August 2011, the Corporate Loss Utilisation through Aggressive Tax Planning Report was published. The Report was prepared jointly by two groups under the OECD umbrella – the Forum on Tax Administration and the Aggressive Tax Planning Steering Group of Working Party 10 on Exchange of Information and Tax Compliance of the Committee on Fiscal Affairs.
More info: PwC's Tax Policy Bulletin

Can Clouds Change Shapes? Transfer Pricing Considerations For Cloud Computing

Anne Welsh, Curt Kinsky, Nick Ronan, and Mark Klitgaard address the transfer pricing considerations arising from the adoption of a cloud computing environment for a company that moves its information technology resources to the cloud. Anne Welsh, Curt Kinsky, Nick Ronan, and Mark Klitgaard are members of Ernst & Young’s transfer pricing team. The views expressed herein are those of the authors and do not necessarily reflect the views of Ernst & Young LLP. The authors would like to thank Stephen Bates for his insights and comments on this article.
Full text of the article

Delhi Tribunal ruling on transfer pricing for procurement services company

The Delhi Income Tax Appellate Tribunal (Tribunal), in a ruling1 in the case of Li & Fung (India) Private Limited (Taxpayer), has ruled on the transfer pricing for a procurement services company. The Taxpayer is part of Li & Fung Group, which has a worldwide network in export trading for the sale of finished products, The Associated Enterprise (AE) received remuneration from uncontrolled customers at 5 percent of the ”FOB value” of exports of the sourced products.
Source and more info: Ernst & Young

Estado de las NIIF pendientes de adopción por la UE

Danish Tax Minister: following termination of tax treaties with France and Spain, no plans to conclude new treaties

On 14 October 2011, the recently appointed Danish Tax Minister published his opinion on whether Denmark should enter new tax treaties with France and Spain. The treaties between Denmark and Spain and Denmark and France were terminated by Denmark with effect from 1 January 2009.
According to the Minister, the existence of tax treaties is favourable but such treaties should not, however, be entered into on any account. From a Danish perspective, it is crucial that future tax treaties contain provisions resulting in a more balanced allocation of the right to tax pension income. As persons resident in Denmark are allowed to deduct private pension contribution, Denmark should be allowed to tax the pension payments as well, regardless of whether or not the beneficiary is resident in Denmark at the time of payment. The terminated treaties with France and Spain gave the exclusive taxing right of private pensions to the residence state of the recipient.
As neither France nor Spain seems to show consideration for the Danish taxation of pensions as a whole, and conclude a new treaty with a provision in line with this view, the Minister does not expect new treaties to be entered into in the near future.

Source: IBFD

Spain, Switzerland sign tax protocol amending treaty

On 27 July 2011 Switzerland and Spain signed a new protocol to amend the double tax treaty, signed on 16 April 1966, (the treaty) and protocol (signed on 29 June 2006) that are currently in force. A version of the new protocol has been released by the Swiss Authorities and can be found on specialized web pages (i.e., IBDF), although there is no official confirmation of whether it has been ratified or the date that it will enter into force. The comments provided hereunder must therefore be confirmed in the light of the official text, once it is released through official channels.
Source and more info:  Ernst & Young

Bangalore Tribunal upholds use of "Excess Earning Method" for determining arm’s length price for transfer of intangible property

The Bangalore Income-tax Appellate Tribunal (Tribunal) in the case of M/s Tally Solutions Private Limited1 (Taxpayer) has ruled that the use of the Excess Earning Method (EEM) is permissible for the purpose of determining the arm’s length price (ALP) for transfers of intangible property (IP) between related parties, in the absence of comparable uncontrolled transactions.
Source and more info: Ernst & Young

New R&D tax incentives in The Netherlands

On October 10, 2011 the Dutch government, i.e. the State Secretary of Finance, published a legislation proposal on the Research & Development Deduction (“RDA”), which was already announced. The objective of the RDA is to facilitate costs – not being labour costs – and investments regarding R&D. With this, a complete tax package of measures to stimulate R&D-activities of companies in the Netherlands is created according to the Dutch government: a deduction for the labour costs regarding R&D, other R&D costs and investments by means of the RDA, and the innovation box (to tax innovation profits at a favorable corporate income tax rate).

Source and more info: Ernst & Young

La viñeta de El Economista

Australian and Japanese tax authorities agree on new streamlined APA process for certain cases

On Monday 10 October 2011 the Australian and Japanese Competent Authorities held a well attended seminar on the bilateral administration of Australia-Japan transfer pricing issues. The seminar, held in Sydney, provided a unique opportunity for Australian taxpayers to hear from the two Competent Authorities in a public forum. Although Japan is the largest source of bilateral APAs for the Australian Tax Office (ATO), it has been a number of years since the Australian and Japanese tax authorities last organised a collaborative public seminar of this nature.

Source and more info: PKN

OECD releases a discussion draft on the definition of “permanent establishment” in the OECD Model Tax Convention

The OECD Committee on Fiscal Affairs invites public comments on proposed changes to the Commentary on Article 5 (Permanent Establishment) of the OECD Model Tax Convention.
Article 5 of the OECD Model Tax Convention includes the definition of the treaty concept of permanent establishment, which is primarily used for the purpose of the allocation of taxing rights when an enterprise of one State derives business profits from another State.
Despite the long history of the concept of permanent establishment, its practical application raises a number of issues. The Committee on Fiscal Affairs, through a subgroup of its Working Party 1 on Tax Conventions and Related Questions, has examined various questions related to the interpretation and application of that definition.
This public discussion draft includes proposals for additions and changes to the Commentary on Article 5 of the OECD Model Tax Convention resulting from the work of that subgroup which have recently been presented to the Working Party for discussion. Given the practical importance of these proposals, the Committee has decided to invite public comments on the proposed changes before they are thoroughly discussed by the Working Party at its meeting at the end of February 2012.
The proposed changes appear in the order of the paragraphs of the current Commentary on Article 5 to which they relate. The Annex includes a consolidated version of paragraphs 1 to 35 of the Commentary on Article 5 that includes all the proposed changes.
This document is a discussion draft released for the purpose of inviting comments from interested parties on the proposals prepared by a working group. It reflects the majority views in the group on some issues on which there was no consensus. Given the preliminary nature of the proposals, this document does not necessarily reflect the final views of the OECD and its member countries.
The Committee intends to ask the Working Party to examine these proposed additions and changes to the OECD Model Tax Convention for possible inclusion through the next update, which is currently scheduled for 2014. It therefore invites interested parties to send their comments on this discussion draft before 10 February 2012. These comments will be examined at the next meeting of the Working Party. It is also intended that Working Party 6 on the Taxation of Multinational Enterprises will be invited to consider any potential issue related to Article 7 that may arise from the proposals included in the discussion draft.
Comments on these proposed changes should be sent electronically (in Word format) to Grace Perez-Navarro, Deputy Director, CTPA (grace.perez-navarro@oecd.org).
Unless otherwise requested at the time of submission, comments submitted to the OECD in response to this invitation will be posted on the OECD website.

Source: OCDE.org

Tax reform can create jobs

High unemployment rates, in the wake of the financial and economic crisis, have governments scrambling to create jobs. The number of long-term unemployed is increasing, with young people and low-skilled workers particularly hard hit.
At their recent meeting, G20 Labour and Employment Ministers emphasized that policies to enhance employment are key to the recovery from the financial and economic crisis. OECD’s new Tax Policy Study No. 21: Taxation and Employment suggests that well-targeted tax reforms can encourage employers to hire more people and the jobless to look for employment.
Taxing employers, through social security contributions or payroll taxes, discourages them from hiring. And taxing employees’ wages lowers their take-home pay and discourages work. Making across-the-board reductions to these tax burdens will be difficult for governments already battling to reduce their deficits. Instead, the report recommends targeted reforms to generate the greatest employment gains at the most efficient cost.
In addition to getting more people into work, these reforms will reduce dependency on benefit payments and pension incomes. In light of rapidly ageing populations, this is critical to ensuring the sustainability of social security systems around the world.
The Study suggests that governments should consider tax cuts for employers who hire low-skilled workers - particularly youth and the long-term unemployed. “By lowering the cost of hiring these workers, tax cuts can reduce unemployment amongst the groups hardest hit by the crisis”, said Jeffrey Owens, Director of OECD’s Centre for Tax Policy and Administration.
To give all people an incentive to work, the report proposes a number of reforms targeted at three groups that tend to be under-represented in labour markets across the world: low-income workers; second earners (generally women); older workers. Analysis suggests tax reform would improve incentives and encourage them to work.

Source: OECD.org

Revenue bodies and banks move towards transparent compliance

Officials from revenue bodies, the banking sector and OECD met in Rome on 10-11 October to discuss ways to enhance the relationship between tax administrations and the banking industry and thus improve tax compliance.

Participants to the seminar “Developing the enhanced relationship in the banking sector” agreed on the need to strengthen co-operation among revenue bodies and the banking sector. Their discussions were based upon the experience of countries which have already implemented a new co-operative approach. The seminar addressed the role of banks in the current economic environment, the impact of recent regulatory changes on tax matters, and the experience of various stakeholders with co-operative compliance programmes. It also addressed issues such as those related to bank losses and how to determine the appropriate tax treatment of branches of foreign banks

The Italian tax authorities and the national banking association announced that they will soon develop a code of tax practice for Italian banks, along the lines of that recently endorsed by the OECD Forum on Tax Administration.

The seminar was opened by Attilio Befera, General Commissioner of the Italian Revenue Agency (Agenzia delle entrate) highlighting that “it is important for tax authorities to adopt a balanced approach: zero tolerance for aggressive tax planning, but at the same time impartiality and fairness in evaluating legitimate tax planning. More in general, an approach aimed at giving certainty to taxpayers”

Noting the importance of sharing ideas and experience, Jeffrey Owens, Director of the OECD Centre for Tax Policy and Administration, said, “ Co-operative compliance initiatives  benefit both governments and taxpayers through  fewer routine audits, increased transparency, a positive impact on compliance culture in general and of course more revenue: a win-win situation”.

Giovanni Sabatini, Director General of the Italian Banking Association (ABI), stressed the importance of introducing a Code of Conduct in Italy and underlined the willingness of ABI to work with the Italian Revenue Agency. "A code of conduct" he said "will help to achieve a right balance between the need to reduce the incentives towards aggressive tax planning and promote certainty and predictability for taxpayers".

The seminar was organised by Agenzia delle entrate (Italian Revenue Agency), in co-operation with the Italian Banking Association, AIBE (Italian Association of Foreign Banks) and the OECD Centre for Tax Policy and Administration.
Source: OECD.org

US Customs solicits comments on new policy related to affect of post-importation transfer pricing adjustments on transaction value

In a significant development in customs valuation and transfer pricing, the US Customs and Border Protection ("CBP") is considering a change regarding the impact of post-importation price adjustments on transaction value. CBP recently posted a notice regarding this matter on its website, and has requested comments by 22 October 2011.

Source and more info: Ernst &Young

Boletín de legislación de septiembre 2011‏

Europea:

• Decisión del Órgano de Vigilancia de la AELC nº 471/09/COL, de 25 de noviembre de 2009, por la que se modifican, por septuagésima cuarta vez, las normas sustantivas y de procedimiento en materia de ayudas estatales introduciendo un nuevo capítulo sobre los criterios para el análisis de compatibilidad de ayudas estatales de formación sujetas a notificación individual. DOUE 231 de 08/09/2011
• Corrección de errores de la Directiva 2008/48/CE del Parlamento Europeo y del Consejo, de 23 de abril de 2008, relativa a los contratos de crédito al consumo y por la que se deroga la Directiva 87/102/CEE del Consejo. DOUE 234 de 10/09/2011
• Decisión de Ejecución de la Comisión, de 16 de septiembre de 2011, por la que se establece un marcador fiscal común de los gasóleos y el queroseno [notificada con el número C(2011) 6422]. DOUE 241 de 17/09/2011
• Decisión de Ejecución de la Comisión, de 16 de septiembre de 2011, relativa a la aplicación de las disposiciones en materia de control y circulación de la Directiva 2008/118/CE del Consejo a los productos clasificados en el código NC 3811, de conformidad con lo dispuesto en el artículo 20, apartado 2, de la Directiva 2003/96/CE del Consejo [notificada con el número C(2011) 6423]. DOUE 241 de 17/09/2011

Nacional:

• Resolución de 23 de agosto de 2011, del Congreso de los Diputados, por la que se ordena la publicación del Acuerdo de convalidación del Real Decreto-ley 9/2011, de 19 de agosto, de medidas para la mejora de la calidad y cohesión del Sistema Nacional de Salud, de contribución a la consolidación fiscal, y de elevación del importe máximo de los avales del Estado para 2011. BOE 212 de 03/09/2011
• Convenio entre el Reino de España y Barbados para evitar la doble imposición y prevenir la evasión fiscal en materia de impuestos sobre la renta, hecho en Bridgetown el 1 de diciembre de 2010. BOE 221 de 14/09/2011
• Real Decreto-ley 13/2011, de 16 de septiembre, por el que se restablece el Impuesto sobre el Patrimonio, con carácter temporal. BOE 224 de 17/09/2011
• Orden TIN/2501/2011, de 15 de septiembre, por la que se fijan para el ejercicio 2011 las bases normalizadas de cotización a la Seguridad Social, por contingencias comunes, en el Régimen Especial de la Seguridad Social para la Minería del Carbón. BOE 228 de 22/09/2011
• Resolución de 15 de septiembre de 2011, del Congreso de los Diputados, por la que se ordena la publicación del Acuerdo de convalidación del Real Decreto-ley 12/2011, de 26 de agosto, por el que se modifica la Ley 1/2000, de 7 de enero, de Enjuiciamiento Civil, para la aplicación del Convenio Internacional sobre el embargo preventivo de buques y se regulan competencias autonómicas en materia de policía de dominio público hidráulico. BOE 229 de 23/09/2011
• Ley 28/2011, de 22 de septiembre, por la que se procede a la integración del Régimen Especial Agrario de la Seguridad Social en el Régimen General de la Seguridad Social. BOE 229 de 23/09/2011
• Orden EHA/2513/2011, de 15 de septiembre, por la que se modifica la Orden EHA/1803/2010, de 5 de julio, por la que se establecen obligaciones en cuanto a la remisión por medios electrónicos de la documentación estadístico-contable de las entidades aseguradoras y de las entidades gestoras de fondos de pensiones, y por la que se modifican los modelos de la información estadístico contable anual y semestral de los corredores de seguros y reaseguros establecidos por Real Decreto 764/2010, de 11 de junio, por el que se desarrolla la Ley 26/2006, de 17 de julio, de mediación de seguros y reaseguros privados en materia de información estadístico-contable y del negocio, y de competencia profesional. BOE 229 de 23/09/2011
• Resolución de 15 de septiembre de 2011, del Congreso de los Diputados, por la que se ordena la publicación del Acuerdo de convalidación del Real Decreto-ley 10/2011, de 26 de agosto, de medidas urgentes para la promoción del empleo de los jóvenes, el fomento de la estabilidad en el empleo y el mantenimiento del programa de recualificación profesional de las personas que agoten su protección por desempleo. BOE 229 de 23/09/2011
• Resolución de 22 de septiembre de 2011, de la Confederación Hidrográfica del Segura, sobre revisión de los cánones de utilización de los bienes del dominio público hidráulico. BOE 231 de 26/09/2011
• Resolución de 22 de septiembre de 2011, del Congreso de los Diputados, por la que se ordena la publicación del Acuerdo de convalidación del Real Decreto-ley 13/2011, de 16 de septiembre, por el que se restablece el Impuesto sobre el Patrimonio, con carácter temporal. BOE 235 de 29/09/2011
  
  
  Comunidades Autónomas:

País Vasco

• Ley 6/2008, de 25 de junio, de la Sociedad Cooperativa Pequeña de Euskadi. BOE 212 de 03/09/2011

La viñeta de El Economista

Obama Administration releases draft legislative language for excess returns and intangibles proposals

On September 23, 2011, the Obama Administration released the draft legislative language for President Obama’s economic growth and deficit reduction plan. In addition to several domestic business tax increases, the draft legislation includes several key provisions designed to reform the U.S. international tax system. These provisions are drawn primarily from the Obama Administration’s prior budget proposals. The two tax reform items most relevant to the area of transfer pricing are (i) the proposal to tax currently the “excess returns” from transfers of intangibles, and (ii) the proposed “clarification” of the definition and valuation of intangibles.

Although each provision has been included in the Administration’s budget proposals for the last two fiscal years, the draft legislative language released on September 23, 2011, provides the first opportunity to see how the broadly worded budget proposals would be translated into specific statutory rules. The draft statutory language fleshes out details regarding the intended scope and application of the Administration’s proposals.

Source and more info: PKN

Mumbai tribunal ruling on payment for intra group services under cost contribution arrangement

The Mumbai Income Tax Appellate Tribunal (Tribunal), in a ruling in the case of M/s Dresser-Rand India Pvt. Ltd. (Taxpayer), has ruled on the transfer pricing aspects of payments made under a cost contribution arrangement for intra group services availed by the Taxpayer from its parent company (an associated enterprise or AE). The Tribunal held that the Transfer Pricing Officer (TPO) cannot question the commercial wisdom or reasoning for providing the services and should restrict itself to determining whether the price paid by the Taxpayer was comparable to the price paid by an independent enterprise for the same transaction.

Source and more info: EY

Indian Tribunal rules on transfer pricing issues arising with respect to parent company loans and guarantees

The Hyderabad Income-tax Appellate Tribunal (Tribunal), in a ruling in the case of M/s. Four Soft Ltd (Taxpayer) has adjudicated on transfer pricing issues arising with respect to parent company loans and guarantees. The Taxpayer had provided a guarantee to a third party bank on behalf of its foreign subsidiary, for which the Taxpayer did not charge a guarantee fee from the subsidiary.

Source and more info: EY

Brazilian Administrative Court decides in favour of taxpayer in a case involving the inclusion of third party freight and insurance services fees in prices practiced by tested party

As widely known, Brazil's transfer pricing rules do not adopt the internationally accepted arm’s length standard. For instance, for the purposes of applying the Brazilian equivalent to the resale price method ("PRL") in transactions involving import of goods between related parties abroad, regulations provide the use of statutory fixed margins to derive a benchmark ceiling price.  In these instances, actual transfer pricing practiced by the local tested party must be lower than that derived benchmark price, otherwise tax authorities will impose a transfer pricing adjustment.  

In addition to the potential double taxation issues resulting from the non-adoption of the arm's length standard, there are many controversial legal issues that have been disputed by taxpayers and tax authorities, since rules became effective on 
January 1, 1997. One of the most controversial issues is whether third party insurance and freight services fees, as well as Brazilian import duties, should or should not be included as an integral part of import costs to determine the actual transfer price practiced by a tested party. In many situations such amounts increase actual transfer prices to levels beyond benchmark prices.  As a result, arguing that these adjustments are mandatory, tax authorities have been imposing tax assessments against many taxpayers. 

Source and more info in PKN

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