Brazil’s approach to intercompany financing may respect the currency of denomination of a multinational’s intercompany loan policies but falls short of other key aspects, such as the term of the intercompany loan. The OECD released its transfer pricing guidance on financial transactions on February 11, 2020. The guidance on the pricing of intercompany loans placed appropriate focus on the contractual terms as well as the credit rating of the borrowing affiliate.
The Organization for Economic Cooperation and Development (OECD) released its Transfer Pricing Guidance on Financial Transactions on February 11, 2020 just before the COVID-19 crisis mushroomed. Some commentators have noted that U.S. affiliates may have to rely on intercompany financing from their foreign parents just as tax authorities and multinationals are reviewing what this new guidance implies in terms of the pricing of intercompany loans.
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