In the Bloomberg 2024 Transfer Pricing Forum, Senior Managing Director Emmanuel Llinares and Delsol Avocats Partner Julien Monsenego explain considerations for the transfer pricing of contract manufacturing. They offer insights on what kinds of contract manufacturing operation tax authorities in France view as high risk and how multinational entities (MNEs) can safeguard their transfer pricing positions to mitigate risk.
The authors discuss what types of benchmarking studies are accepted and typically applied when remunerating contract manufacturers in France. In addition, they discuss transfer pricing implications for government subsidies and grants in contract manufacturing. Finally, the authors explain transfer pricing considerations for financing expenses related to transactions involving contract manufacturers and who should bear the foreign exchange risks in these transactions.
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