Base erosion and profit shifting

OECD and IGF invite comments on a draft toolkit to support developing countries in addressing base erosion and profit shifting risks when pricing minerals


06/11/2023 - As part of the ongoing work of the OECD/IGF partnership on BEPS in the mining programme, the OECD is seeking public comments on an additional toolkit that is designed to support developing countries in addressing the transfer pricing challenges faced when pricing minerals. The toolkit applies this transfer pricing framework as documented in Determining the Price of Minerals: A Transfer Pricing Framework to a specific mineral (lithium).



For many resource-rich developing countries, mineral resources present a significant economic opportunity to increase government revenue. Tax base erosion and profit shifting (BEPS), combined with gaps in the capabilities of tax authorities in developing countries, threaten this prospect. The OECD's Centre for Tax Policy and Administration (CTPA) is collaborating with the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF) to address some of the challenges developing countries face in raising revenue from their mining sectors. Under this partnership, a series of practice notes and tools are being developed for governments.


The IGF and OECD CTPA have formed a partnership, combining the IGF's mining expertise with the OECD's knowledge of taxation to design sector-specific guidance on some of the most pressing BEPS challenges facing resource-rich developing countries. This work is published under the responsibility of IISD and of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of the Member countries of the OECD and the IISD.


Government revenue depends on mineral products being priced and measured accurately. However, pricing is not always straightforward. It may be complicated by the different stages of mineral beneficiation, the lack of publicly quoted prices for certain minerals, and adjustments based on the quality or grade of the product. Many governments worry they do not know the value of their exported minerals and are therefore losing much-needed revenue.


Public consultation document

One document is released for public consultation:

  • Determining the Price of Minerals: Application to Lithium (also available in French and Spanish) provides a framework to identify the primary economic factors that can influence the pricing of minerals ("mineral pricing framework") using transfer pricing principles. It shows how the framework can be applied to lithium. Further toolkits applying the framework to other commodities will be released as they are developed.


This toolkit is for policymakers and tax administrations in resource-rich developing countries where mining activity is being undertaken by multinational enterprises (MNEs). Mining provides a significant contribution to the economies of many developing countries; however, achieving an arm's length price for the sale of the host state's mineral products can be challenging. The cross-border sale and purchase of mineral products between related parties poses a significant BEPS risk through MNEs selling mineral products to related entities abroad at prices below arm's length, thereby shifting sales revenue and profits offshore. The toolkit provides practical and meaningful guidance for developing countries to accurately delineate the transaction and price mineral sales on an arm's length basis applicable to lithium exports. The OECD and IGF are seeking comments regarding the application and usability of this toolkit to ensure that they are fit for purpose and appropriately tailored to the needs and requirements of developing countries.


Interested parties are invited to send their comments no later than 2 February 2024 by e-mail to [email protected] in Word format (in order to facilitate their distribution to government officials). All comments should be addressed to the Global Relations and Development Division, OECD Centre for Tax Policy and Administration.


Please note that all comments received will be made publicly available. Comments submitted in the name of a collective "grouping" or "coalition", or by any person submitting comments on behalf of another person or group of persons, should identify all enterprises or individuals who are members of that collective group, or the person(s) on whose behalf the commentator(s) are acting.


More information

Further information on the work of both organisations is available at: