• Ability to identify intra-group transactions subject to the arm's length standard.
• Ability to identify relevant comparability factors for the purpose of setting 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.

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 recently updated their guidelines for documentation and 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.

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

(Selected chapters)