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The COVID-19 pandemic has ushered in a new normal for both traditional and alternative asset managers. The sector has seen the combined effect of large asset outflows, a further tilt towards passive products, and lower asset valuations that are reducing the stream of management and potential performance fees. For alternative funds, the pandemic has also affected the quality of investment assets (e.g., considering its broader impact on the commercial real estate sector), triggering transfer pricing questions regarding underlying financing arrangements that are inherently linked to the quality of the financed assets.
In this article, we examine the transfer pricing impact of this new normal on regulated entities in the asset management sector, including the tax treatment...
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