Multinational enterprises (MNEs) are continuously exploring opportunities to reduce costs and increase efficiency by streamlining processes and relocating functions across countries. In designing organizational structures, the possibility of pursuing tax savings is often one of the drivers in the decision-making process. As a result, MNEs normally consider the use of tax-efficient supply chain management structures when reorganizing their business or establishing in new markets.

This 3-day course is designed to provide participants with a thorough knowledge of the transfer pricing issues that would need to be taken into account when a business restructuring takes place within an MNE. Participants will acquire an in-depth understanding of the trends relating to business restructurings, the relevant tax and transfer pricing concepts and methodologies, including the 2010 updates to the OECD Transfer Pricing Guidelines, and how an in-house tax manager of an MNE might approach the reorganization of supply chain operations. Moreover, the course will address indirect taxation and permanent establishment issues that are associated with supply chain restructuring.

The course will be conducted by highly regarded international practitioners specialized in the field of transfer pricing and the associated fields. The course will also include practical examples and case studies to enable participants to gain confidence in applying the skills acquired during the course in practice.

This is an interactive course with a maximum of 30 participants. Prior to the course, participants will be given access to an online platform which provides them with additional pre-reading material and supplementary material (e.g. legal documentation, case law and related articles/literature). During the course, participants will be provided with a course binder containing documents relevant to the course.

Day 1


08.30 - 09.00 Registration

09.00 - 09.20 Welcome and IBFD Overview

09.20 - 11.00 The Significance of the Issue

• What are the business reasons for restructuring?
• Business restructuring from a transfer pricing standpoint
• Tax authorities’ approach regarding business restructuring
• 2010 OECD Transfer Pricing Guidelines
• Looking ahead: OECD projects on intangibles and permanent establishments

11.00 - 11.20 Break – Refreshments

11.20 - 12.45 Tax-Effective Supply Chain Transformation

• Most common types of business restructuring
• Principal manufacturer v. contract/toll manufacturer
• Conversion from fully fledged distributor to limited risk distributor, service company or commissionaire or agent
• Relocation of IP
• Choice of location for principal entities
• Cost of business restructuring

12.45 - 14.00 Lunch

14.00 - 15.00 Tax-Effective Supply Chain Transformation (continued)


15.00 - 15.20 Break – Refreshments

15.20 - 17.00 Business Restructuring – A Company’s Perspective

• Corporate perspective on business restructuring
• Motivations for restructuring
• Valuation of tax issues by an MNE
• Importance of anti-avoidance rules
• Case study


Day 2


09.00 - 10.30 2010 OECD Transfer Pricing Guidelines on Business Restructuring


• The OECD theoretical framework
- recognition
- allocation of risks
- conversion issues
- post-restructuring transfer pricing
• Chapter 9 of the 2010 OECD Transfer Pricing Guidelines
- risks and migration of risk
- the concept of “Transfer of Functions”
- the issue of location savings
- importance of documentation
• What can the taxpayers rely on?
• What can the tax administrations adjust?

10.30 - 10.50 Break – Refreshments

10.50 - 12.45 2010 OECD Transfer Pricing Guidelines on Business Restructuring (continued)

12.45 - 14.00 Lunch

14.00 - 15.30 Restructuring of Intangibles
• Tax-effective IP models
- contract R&D
- cost contribution arrangements
- principal model
• Relocation of IP
• Other ways to structure intangibles migration
• Existing transfer pricing guidelines on intangibles
- transfer pricing methods
- royalty rate determination
- IP valuation
• OECD developments
• Case study

15.30 - 15.50 Break – Refreshments

15.50 - 17.00 Restructuring of Intangibles (continued)


Day 3


09.00 - 10.30 Business Restructuring and Permanent Establishments

• Business restructuring and the permanent establishment (PE) threshold
• Identification of PEs
• Agency PEs (common and civil law approaches)
• Typical business structures and associated PE risk
• Attribution of profits to a PE
• Practical examples
• Case study

10.30 - 10.50 Break – Refreshments

10.50 - 12.45 Business Restructuring and Permanent Establishments (continued)

12.45 - 14.00 Lunch

14.00 - 15.30 Indirect Taxes and Business Restructuring
• Indirect taxes on business restructuring transactions
• VAT implications
• Warehousing rules
• Manufacturing and distribution activities
• Practical examples
• Case study

15.30 - 15.50 Break – Refreshments

15.50 - 17.00 Indirect Taxes and Business Restructuring (continued)

Shee Boon Law, IBFD, the Netherlands; Danny Oosterhoff, Ernst & Young, the Netherlands; Monica Erasmus, PWC Rotterdam, the Netherlands and Hans van Egdom, Dutch Tax Administration, the Netherlands; Jan Snel, Baker & McKenzie, the Netherlands