Dutch Ministry of Finance issues new Decree on the arm’s length principle

Tax Insights ()
On November 26, 2013 a new Decree of the Dutch Ministry of Finance was published in order to provide further guidance on the application of the arm’s length principle. The official implementation date of the Decree is November 14, 2013.

Since 1 January 2002, specific transfer pricing provisions have been included in Article 8b of the Dutch Corporate Income Tax Act. The Dutch transfer pricing legislation is largely based on the OECD Guidelines, with some modifications to reflect Dutch business practices.

The Decree provides guidance on the Dutch tax authorities’ interpretation of the OECD Guidelines and clarifies how certain issues should be approached in practice. The Decree replaces the Decrees of 30 March 2001, No. IFZ2001/295 and of 21 August 2004, No. IFZ2004/680M.