Transfer Pricing and COVID-19: the OECD guidance

The COVID-19 pandemic is causing disruptive effects on the entire global economic and financial system, with evident impacts on business activities. Among these, companies belonging to multinational groups may find themselves forced to review their business models and related transfer pricing policies, in order to face the recessive effects caused by COVID-19.

In fact, the definition and verification of transfer prices must take into account the reference economic scenario. Therefore, in the current context, it is essential for companies to understand what actions to take to manage the impact of the pandemic, which has significantly changed ordinary activities, with direct effects on transfer pricing policies.

The OECD, as expected, intervened on the issue by publishing the “Guidance on transfer pricing implications of the COVID-19 pandemic” report on 18 December 2020, which provides practical information on how to manage the impact of the pandemic in order to correctly apply the arm's length principle in intra-group transactions.

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