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2016/2017  BA-BHAAV1012U  Transfer Pricing in Multinational Enterprises

English Title
Transfer Pricing in Multinational Enterprises

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Bachelor
Duration One Quarter
Start time of the course First Quarter
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 90
Study board
Study Board for BSc in Economics and Business Administration
Course coordinator
  • Christian Plesner Rossing - Department of Accounting and Auditing (AA)
Main academic disciplines
  • Globalization and international business
  • Accounting
  • Tax law
Last updated on 22-02-2016
Learning objectives
To achieve the grade 12, students should meet the following learning objectives with no or only minor mistakes or errors:
  • Ability to identify intra-group transactions subject to the arm's length standard.
  • Ability to identify relevant comparability factors for the purpose of setting/testing transfer prices.
  • Ability to identify relevant transfer pricing methods for specific intra-group transactions.
  • Ability to apply transfer pricing methods to specific accounting and business data.
Course prerequisites
The student should have an understanding of basic concepts in accounting and business analysis.
Transfer Pricing in Multinational Enterprises:
Exam ECTS 7,5
Examination form Written sit-in exam
Individual or group exam Individual exam
Assignment type Multiple choice
Duration 2 hours
Grading scale 7-step scale
Examiner(s) One internal examiner
Exam period Autumn
Aids allowed to bring to the exam Limited aids, see the list below:
  • Written sit-in-exam on CBS' computers
  • Any calculators
  • All dictionaries
Make-up exam/re-exam
Same examination form as the ordinary exam
If the number of registered candidates for the make-up examination/re-take examination warrants that it may most appropriately be held as an oral examination, the programme office will inform the students that the make-up examination/re-take examination will be held as an oral examination instead.
Ved få deltagere til syge/omprøven kan eksamensformen ændres til en mundtlig stedprøve.
Course content and structure

Most accounting & finance managers at large and medium-sized multinational enterprises are confronted with transfer pricing, i.e. the pricing of intra-group transactions.


It is estimated that more than half of all global trade is conducted between parties, which are part of the same group, and the OECD as well as most tax authorities have intensified their focus in such intra-group trade. Namely OECD’s project on Base Erosion and Profit Shifting has put increased pressure on multinational enterprises and their transfer pricing policies. This is primarily due to that tax authorities are pressuring multinationals to apply recognized principles for transfer pricing to reduce aggressive tax management and profit shifting to low-tax jurisdictions. In the media, multinational enterprises such as Starbucks, Google, Amazon, Apple and Intel have been subject of attention. However, transfer pricing is highly relevant to far more enterprises than just well-known global brands.


The objective of the course is to provide students with the necessary tools to diligently assess intra-group transfer pricing policies in line with internationally recognized principles, in particular the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations. The course focuses on the most typical aspects of the OECD Framework (e.g. the arm’s length principle, transfer pricing methods, comparability analysis, and documentation) and ensures that students are comfortable with making basic transfer pricing analyses.


The course is separated into five sub-topics taught in the following, logical order:


1. The transfer pricing problem and arm’s length principle. A thorough introduction to transfer pricing (legally, economically, politically) along with key sources of transfer pricing risks.


2. Types of intra-group transactions. Specific types of intra-group transactions (goods, services, intangibles) and their distinct challenges from a transfer pricing perspective.


3. Transfer pricing analyses. Value creation analyses, functional analyses and namely comparability analyses for identifying and interpreting the economic references needed under the arm’s length principle.


4. Transfer pricing documentation. Most countries (including Denmark) have transfer pricing documentation requirements, and the OECD very recently (September 2014) provide a suggestion for an entirely new framework for documentation as well as Country-by-Country Reporting.


5. Defence strategies and dispute resolution. Focus is on Advance Pricing Arrangements, i.e. ex ante transfer pricing agreements between tax authorities in different countries and multinationals, as well as Mutual Agreement Procedures, i.e. ex post allocation of income among tax jurisdictions as per agreements between tax authorities in different countries.


The course is taught based on intensive classroom exercises and exemplification based on recognized theory. Specifically, each session begins with a focus on distinct theoretical/academic topics within the area of strategy, accounting, value chain analysis, and risk management, which are subsequently demonstrated thorugh practical examples. At the end of the course, a large case study is used to capture and summarize core concepts of the course to students.

Teaching methods
Lectures and exercises.
Student workload
Teaching in class 33 hours
Excercises 60 hours
Preparation 86 hours
Exam 25 hours
Expected literature

OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations. 2010. OECD: Paris. 371 pages.

Last updated on 22-02-2016