Newsletter July 2024

In this edition of the newsletter, you will find the most important national and global developments in tax law that are (closely) related to the transfer pricing world.? ?

Please feel free to contact us if you have any questions.

Quantera Global news, developments, and blogs ?

• On 6 June, we published a blog on the evolution of Dutch transfer pricing over the past decade, highlighting regulatory changes, the influence of OECD guidelines, and future challenges for businesses navigating this complex landscape. You can read the blog here.?

• On 20 June, we published a blog explaining various transfer pricing methods for intercompany transactions, detailing their applications and advantages to ensure compliance and optimise operational efficiency. You can read the blog here.?

• On 27 June, we published a comprehensive overview of key abbreviations, including DACs, ATADs, and OECD Pillars, to help (tax) professionals navigate the complexities of international tax regulations. You can read the publication here.??

• On 31 July, you can enjoy our webinar on "Transfer pricing aspects of financial transactions". For more information and to be notified when you can register you can follow Quantera Global on LinkedIn by clicking here.?

• We are pleased to highlight our ongoing collaboration with MUSE Strategy as a member of the Quantera Global Network. As part of this collaboration, we are pleased to share their latest newsletter on APAs in Italy.?You can read the publication here.?

• Quantera Global is launching a podcast! The first guest of the podcast will be Gian Luca Nieddu from MUSE strategy. To stay informed on when it launches, follow the host of the podcast on LinkedIn by clicking here.

Quantera Global specialties?

In the past month, we completed several challenging and interesting projects worth mentioning, including:??

• We finalised complex transfer pricing analyses requested by the tax authorities on the allocation of results between an EU-based headquarter/entrepreneur and a Brazilian subsidiary/entrepreneur.?

• We finalised a financial guarantee analysis for a large loan transaction of one of our clients.? ?

If you would like to know more about these topics, please feel free to?contact?us.?

News from around the world?

Australia?

On 5 June, the Australian government introduced legislation to Parliament for public country-by-country (CbC) reporting starting from 1 July 2024. This information will be made public on a government website and must be submitted within 12 months of the reporting period's end.??

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Canada?

Canada has enacted tax measures previously proposed in federal budgets, through Bills C-59 and C-69. These measures include the following corporate tax measures:?

• The Global Minimum Tax Act;?

• EIFEL rules for interest expenses;?

• Hybrid mismatch arrangements;?

• New rules for Canadian-controlled private corporations; and?

• Incentives for critical mineral exploration, carbon capture, and clean technology.?

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European Union?

On 21 June the Economic and Financial Affairs Council of the EU (ECOFIN Council) approved a report on the progress of EU direct tax initiatives, including directive proposals such as FASTER, Unshell, Transfer Pricing and BEFIT. Additionally, the Code of Conduct Group presented its report on activities conducted in the first half of 2024.?

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Germany?

On 28 June, Germany's Federal Ministry of Finance published the draft bill for the Annual Tax Act 2024, which includes significant changes related to Pillar Two rules and various tax measures. The bill will undergo parliamentary review in the Bundestag and Bundesrat, potentially leading to further amendments.?

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Italy?

On 11 June, Italy introduced draft legislation aligning with the EU Public Country-by-Country Reporting Directive.??

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Luxembourg?

Luxembourg introduced Bill 8396 amending the Pillar Two law enacted in December 2023. This draft legislation incorporates technical aspects from OECD Commentaries and administrative guidance issued in February, July, and December 2023. It also proposes additional amendments to existing provisions and aims to clarify aspects of the law.?

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The Netherlands?

On 6 June, the Dutch Tax Authority’s Knowledge Group Pillar 2 published its view on non-profit organisations (requirement B) under the Dutch Pillar 2 rules.??

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OECD?

• On 4 June, the OECD released expanded FAQs for the International Compliance Assurance Programme (ICAP). The updated FAQs offer more details on ICAP participation, including eligibility, the role of external advisors, and specifics on risk assessment periods. These updates follow earlier ICAP statistics highlighting its effectiveness in dispute prevention.??
• On 17 June, the OECD released additional guidance on Pillar One Amount B, mainly including new definitions.??

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Serbia?

Serbia's Ministry of Finance adopted a new rulebook on safe harbour interest rates for 2024, published on 31 May and effective from 8 June. This rulebook outlines increased interest rates compared to 2023 and provides rates for long-term and short-term borrowings for non-finance entities, and a single rate for banks and finance leasing companies. Taxpayers must choose between using these prescribed rates or applying OECD-based methods for intercompany loans on a consistent basis.??

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