CASE STUDY
Complex CUP with regression analyses for a listed medtech
Client: Listed medical devices developer and manufacturer
Issue: The transfer pricing policy between the French and US entities required an update
Why it worked
TP qube applied the internal CUP method to derive the transfer price between the French and the US entities.
Even if the internal contract with third parties provided a good starting point, adjustments were performed to increase comparability between the tested transactions and the comparable ones.
A good understanding of the company business and a seamless collaboration with its tax lawyer, notably its customs team, led to an effective implementation.
Adjusted Internal CUP method
Application of the internal CUP method.
Review of transactions with third parties.
Analysis of the main differences to consider.
Key Adjustments
1
Econometric modelling was used to analyse the volume discount offered to third parties and apply it to the tested transaction.
2
The split of the customs fee between the importer and the exporter was analysed to improve comparability.
Outcome
A transfer pricing policy update grounded in the business and implemented effectively through close coordination with the company and its tax lawyer.