Take a one week trial to International Tax Review and find many more related articles.

On January 19 and 20, a group of specialists gathered at the UN headquarters in New York to discuss what topics the new transfer pricing manual should cover.

The UN tax committee has for the first time created a subcommittee on transfer pricing and tasked the group with creating a practical manual covering many different aspects of transfer pricing that developing countries in particular have problems with.

The meeting began with a debate over whether to promote the arm's length principle or the formulary apportionment method. As the meeting progressed this problem came up repeatedly, with no firm decision made by the end of the two days.

Transfer pricing methods were also high on the agenda, with panellists discussing the complexities involved in applying all the OECD-accepted methods.

The suggestion of using country-by-country reporting led to a heated exchange between delegates.

Ways to build transfer pricing expertise within governments was a popular topic, and the urgency of providing access to sophisticated education resources for transfer pricing auditors was stressed.

Whether the existing methods of dispute resolution work for developing economies was an interesting debate, with several countries expressing fears about the cost of arbitration.

The levels of documentation required to police transfer pricing caused concern for some of the specialists present, but the need to request the proof of proper pricing as a way to limit abuse of the system was acknowledged.

The UN subcommittee has a difficult job on its hands as it strives to create the manual. There will be more meetings as the document starts to take shape.

Take a one week trial to International Tax Review and find many more related articles.