Changes in the Laws on transfer pricing of Hong Kong

On January 10^th, 2018, amendments to Hong Kong's legislation aimed at consolidating the principles of transfer pricing in the Law on internal taxation of Hong Kong and the minimum standards of the BEPS plan came into force.

The amendments include the introduction of transfer pricing regulation, documentation definition, legal dispute resolution and other issues.

In the regulation of transfer pricing, the principle of concluding transactions on market conditions is taken into account.

Additionally, the documentation includes a three-step structure: a base file, a local file and directly country-specific reporting.

The main objective is to counteract the use of gaps and inconsistencies in tax rules by international companies that artificially deduct profits from taxation and operate in jurisdictions with low tax rates.

On materials of the following website: http://www.info.gov.hk/gia/general/201712/27/P2017122200788.htm