OECD releases revised section on safe harbours

Tax Controversy & Dispute Resolution ()

On May 16, 2013, the Organisation for Economic Co-operation and Development (OECD) Council approved the Revised Section E on Safe Harbours in Chapter IV of the Transfer Pricing Guidelines.

The Revised Section E (Section E) consists of only nine pages, mostly suggestions and guidance for tax authorities evaluating the benefits and concerns regarding safe harbour provisions. Ultimately, Section E cautions tax authorities on the adoption of safe harbours, especially unilateral safe harbours. Nevertheless, Section E advises that if safe harbours are adopted, bilateral or multilateral safe harbours negotiated between Competent Authorities may be the best route.