The database now has 91 transfer pricing country profiles after the additions of Ukraine, Jamaica, Honduras, Iceland, Senegal and Papua New Guinea — all members of the OECD inclusive framework on base erosion and profit shifting — according to the news release. In addition to updating the profiles for China, the U.S. and Brazil, the OECD revised those of Canada, Chile, Croatia, the Dominican Republic, Estonia, Finland, Greece, Hungary, Israel, South Korea, Liechtenstein, Lithuania, Luxembourg, Malta, Panama, Portugal, Slovenia, the U.K. and Uruguay.
It's the third batch of profiles based on checklists completed by each country's main tax authority evaulating whether countries meet the OECD's transfer pricing guidelines, which were updated in January. The profiles note whether countries govern financial transactions in ways that meet the guidelines, which include authorized allocation approaches for attributing profits to permanent establishments.
The database is based on survey responses from each jurisdiction's main tax authority and tracks the countries' adherence to transfer pricing criteria revised following the OECD's base erosion and profit shifting project in 2015.
For example, the OECD's transfer pricing guidelines are not incorporated into law in Ukraine, the organization noted, but are accepted as guidance to explain and clarify the arm's-length principle. Jamaica doesn't define "related parties" in law or regulation, but the country's relevant legislation follows the transfer pricing guidelines, which serve as the main resource for resolving disputes.
Fifty-seven of the U.S.' bilateral tax treaties do not follow any of the OECD's authorized approaches to attributing profits, according to the information labeled "new" in its profile, while seven follow the authorized approaches. China does not follow any OECD authorized approaches in attributing profits to permanent establishments, according to the information published Monday.
None of Brazil's 36 tax treaties attribute profits to permanent establishments based on the OECD's authorized approaches, the country's profile said. On Jan. 1, the OECD said it was beginning accession discussions with Brazil and five other nations, according to a separate news release.
On Monday, Romania, another country the OECD may allow to join the group of mostly wealthy nations, pledged to begin enforcing the main treaty undergirding the BEPS project.
The OECD did not respond to a request for comment.
--Editing by Neil Cohen.
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