Transfer Pricing

Tax disputes often arise over disagreement about the fair transfer price for an asset, service, or product. The taxing authority of a country typically argues that too much profit was transferred to a different country. We have been retained on behalf of numerous multinational companies to determine the best methods for measuring arms-length pricing, for determining the proper valuations for the purposes of restructuring and assessing appropriate capital structures.

As an example, in the Glaxo transfer pricing dispute with the Internal Revenue Service over how much of the profits from the sales of the company’s drugs should be attributed to its US subsidiaries, and thus subject to US tax, Brattle principals either sponsored or supported the development of testimony by almost a dozen testifying experts in various aspects of valuation, competition in the pharmaceutical industry, R&D, sales and marketing, the FDA, and transfer pricing.