Release of discussion draft on the transfer pricing aspects of cross-border commodity transactions


16/12/2014 – Public comments are invited on this discussion draft which deals with work in relation to Action 10 (“Assure that transfer pricing outcomes are in line with value creation” in relation to “other high risk transactions”) of the Action Plan on Base Erosion and Profit Shifting (BEPS).


The OECD Action Plan on Base Erosion and Profit Shifting, published in July 2013, identifies 15 actions to address BEPS in a comprehensive manner and sets deadlines to implement these actions.


Action 10 identifies that work needs to be undertaken to develop “rules to prevent BEPS by engaging in transactions which would not, or would only very rarely, occur between third parties. This will involve adopting transfer pricing rules or special measures to . . .  (iii) provide protection against common types of base eroding payments.”  In this regard, a number of countries report difficulties in relation to the pricing of cross-border commodity transactions, particularly in terms of determining adjustments to quoted prices, verifying the pricing date, and accounting for the involvement of other parties in the supply chain. These difficulties have led to the emergence of the so-called sixth method for pricing commodity transactions. The discussion draft thus contains proposals for additional guidance, and seeks further input in addressing difficulties in relation to the pricing of cross-border commodity transactions.


Please note that this discussion draft is available in French and Spanish


Interested parties are invited to submit written comments by 6 February 2015 (no extension will be granted). Comments should be sent by email to [email protected] in Word format (in order to facilitate their distribution to government officials). They should be addressed to Andrew Hickman, Head of Transfer Pricing Unit, Centre for Tax Policy and Administration.


Please note that all comments received regarding this discussion draft 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, or the person(s) on whose behalf the commentator(s) are acting.


Public consultation meeting

A public consultation on the discussion draft and other topics will be held on 19-20 March 2015 at the OECD Conference Centre in Paris. Registration details for the public consultation will be published on the OECD website in due course. Speakers and other participants at the public consultation will be selected from among those providing timely written comments on the discussion draft.