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By Sophie BALLIET, Counsel, Allen Overy S.C.S.
On 12 September 2023, the European Commission has proposed a council directive on transfer pricing (TP Directive) to harmonise key principles across the EU. The TP Directive relies on the integration of the arm's length principle into EU legislation (and a consistent application of it) to increase tax certainty, reduce compliance costs, and mitigate the risk of double-taxation and litigation for cross-border intra-group transactions within the EU. If adopted unanimously by the EU Council, the TP Directive would apply from 1 January 2026.
Over the last decade, the Commission's ambition has clearly been to have more say in...
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