International transfer pricing developments: Russia

Transfer pricing is becoming a hot topic in Russia these days due in part to the fact that although the current legislation contains relevant provisions they do not work efficiently. However the Government is more determined than ever to change this practice by the introduction of new laws starting in 2011. 

While the general concept of Russia’s existing TP rules complies with the OECD’s ‘arm’s-length’ principle Russia is not an OECD member and certain provisions are different. Currently the list of controlled transactions is quite broad and includes cross-border transactions (whether or not the parties are associated) barter deals intra-group domestic and foreign transactions and transactions where the price for identical goods and services fluctuates by more than 20% within a short period of time. Intellectual property rights...