Italy ruling boosts transaction toolkit: Transfer Pricing Report

Italian Ruling Boosts Transfer Pricing Toolkit

When the Italian Supreme Court recently accepted a subsidiary’s no-fee guarantee for a parent company’s loan, it heartened tax pros as another sign that economic and business considerations have a growing chance of validity in transfer pricing.

Granular examination of transactions still applies, with all its complexity of arm’s-length pricing, comparables, and more, but broader issues have a legitimate place, practitioners said. There’s more room for the broader factors, they said after the decision, which involved NN Europe SpA, now TN Italy SpA.

“The full economic context becomes relevant: the business ...