On 7-9 November 2011, delegates from Working Party No. 6’s Special Session on the Transfer Pricing Aspects of Intangibles (“WP6-TPI”) met with private sector representatives to discuss definitional and ownership issues related to transfer pricing for intangibles. The agenda for the meeting, presentation material submitted by private sector participants and list of participants have now been published.
Presentations at the consultation focused on five topics: (i) the definition of intangibles for purposes of Chapter VI of the OECD Transfer Pricing Guidelines; (ii) the definition and treatment of goodwill for transfer pricing purposes; (iii) the definition of the term “brand” and the importance of brand in transfer pricing analyses; (iv) the appropriate approach for determining entitlement to intangible related returns for transfer pricing purposes; and (v)the importance of corporate synergies in a transfer pricing analysis.
Mr. Chris Lennon, the Chair of the BIAC Tax Committee, said that the overriding objective of the business community in connection with the project is to achieve certainty and to achieve a set of rules that will help eliminate double taxation. He pointed out that agreement on a set of consistently applied definitions was a key element in achieving those objectives. He urged the delegates not to reopen issues already clarified in the recently concluded project on business restructuring as reflected in Chapter IX of the 2010 version of the Transfer Pricing Guidelines.
Ms. Michelle Levac, the Chair of the WP6 TPI, welcomed the participation of the business community in the project and the open interaction that characterised the consultation. In her concluding remarks she said that the discussions had been very helpful to delegates in clarifying their thinking and helpful in advancing the project. She recognised the difficulty of providing clear guidance on definitional and ownership issues and indicated that consultation with the business community will continue on these and other issues throughout the project. She suggested that the project is moving forward in a timely way and that the WP6 – TPI expects to complete a discussion draft by the previously announced target of December 2013.