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Réponse au questionnaire de la cellule "Prix de transfert" du SPF Finances pour les transactions entre Automation & Robotics et Arom, sa filiale américaine

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Somja, Aurore ULiège
Promotor(s) : Van Caillie, Didier ULiège
Date of defense : 20-Jun-2016 • Permalink : http://hdl.handle.net/2268.2/1330
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Title : Réponse au questionnaire de la cellule "Prix de transfert" du SPF Finances pour les transactions entre Automation & Robotics et Arom, sa filiale américaine
Author : Somja, Aurore ULiège
Date of defense  : 20-Jun-2016
Advisor(s) : Van Caillie, Didier ULiège
Committee's member(s) : Peere, Isabelle ULiège
Schleck, Daniel ULiège
Closset, Christian 
Language : French
Discipline(s) : Business & economic sciences > Accounting & auditing
Institution(s) : Université de Liège, Liège, Belgique
Degree: Master en sciences de gestion, à finalité spécialisée en Financial Analysis and Audit
Faculty: Master thesis of the HEC-Ecole de gestion de l'Université de Liège

Abstract

[en] Automation & Robotics (A&R) is an international company manufacturing technologically sophisticated optical equipment. With their development strategy, A&R has been establishing entities around the world: in the United-States (AROM), in China (A&R China), in Brazil (A&R do Brasil) and in Thailand (representative office). This internationalization leads the A&R group to face transfer pricing problems, that is to say, tax issues, financial issues and economic issues.
Thanks to OECD guidelines, the transfer prices can be better tackled. The founding principle of these guidelines is the arm’s length principle which aims to determine the right transfer price, which is the price that would be fixed between unrelated parties for a comparable transaction in comparable circumstances. In order to identify the arm’s length price, the tax payer should realize a comparability analysis which includes a functional analysis. The latter implies the study of the functions, risks and asset allocation between the parent company and the subsidiary. In Belgium, the OECD framework has been transposed into domestic law and the Belgian tax authorities created the Transfer Pricing Audit Cell whose role is the arm’s length conformity check. For this purpose, the cell established a documentation form which allows the tax payer to gather useful information in order to justify their transfer pricing policy.
As A&R behaves as a prudent business manager, I have been asked to answer to the Transfer Pricing Audit Cell form which is based on the OECD recommendations. Here are the main conclusions of the analysis of the transactions between A&R and AROM, the American subsidiary: A&R plays the role of the manufacturer while AROM can be considered as a distributor with limited functions; this latter fact allows justifying the use of the Resale Price Method. However, due to the fact that access to databases, allowing the research of comparables, is quite expensive, the amount of gross margin is still not justified. This problem can be solved if A&R resorts to a transfer pricing expert company. Similarly, the determination of a new transfer pricing policy for the transactions between A&R and A&R China and for the transactions with the future Thai subsidiary (the current representative office) should also be determined by an expert company.


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  • Somja, Aurore ULiège Université de Liège > Master sc. gest., fin. spéc. fin. analysis & aud (ex 2e ma.)

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