The Master File is one of the central components of the transfer pricing documentation established by the OECD within the BEPS Action 13 standard. Its purpose is to provide an overview of the multinational group: organizational structure, business description, intangibles, financial activities, and consolidated tax position.
Although the OECD recommends its adoption, not all Latin American countries have incorporated it, which leads to significant differences in tax compliance among multinational groups operating in the region.
This article presents a clear and comparative overview of the Master File in Latin America: what it is, what it should contain, and in which countries it is mandatory.
What is the Master File?
The Master File is a comprehensive document that provides a comprehensive overview of the multinational group. Its purpose is to enable tax administrations to understand how the group operates before analyzing specific transactions. To this end, it is structured into sections detailing the organization, activities, intangibles, financial policies, and global transfer pricing strategy.
Below is an explanation of what each of the elements that must be included consists of:
1) Organizational structure of the multinational group
- What to include: legal organization chart with all the entities in the group (countries of residence and ownership percentages); operational organization chart showing functions and decision-making centers; identification of key entities (headquarters, regional centers, service hubs, owners of intangible assets).
- Why: it makes it easier for the authority to locate the relevant actors and understand the chain of control and corporate decisions that explain the allocation of profits.
2) Global activities and lines of business
- What to include: description of the main lines of business (products/services), global operating model (centralized, regional, service centers), the supply chain relevant to the most important products/services, and key markets by region.
- Why: it provides the economic context that allows for an assessment of whether intra-group transactions are consistent with how value is generated in the group.
3) Relevant intangibles and intellectual property policies (DEMPE)
- What to include: list of important intangibles (brands, patents, software, know-how), legal owners, location of R&D activities and, especially, the DEMPE analysis (Development, Enhancement, Maintenance, Protection, Exploitation) indicating which entities perform these functions and how they are remunerated.
- Why: The BEPS standard requires that information on intangibles allow for an assessment of whether the remuneration corresponds to those who actually create, preserve, and exploit the value (not just the legal owner).
4) Financial activities and intra-group financing agreements
- What to include: group financing policies, description of intra-group loans and conditions (rates, terms), cash pooling, treasury functions and intra-group guarantees, as well as the consolidated capital structure.
- Why: defines the sustainability and consistency of the allocation of financial risks and remuneration for centralized financing functions. The OECD provides guidance on financial transactions and supporting documentation that should be attached.
5) Global transfer pricing strategy
- What to include: internal policies (preferred methods—TNMM, CUP, net margin, etc.), rules for pricing in distribution, manufacturing, service provision, and intangible asset treatment models; risk allocation criteria; internal control and compliance audit mechanisms.
- Why: It helps to understand the consistency between the group’s economic policy and the results reported by each entity, facilitating comparability analysis.
6) Consolidated financial and tax information of the group
- What to include: Consolidated financial statements (audited if available), results by segment or region, taxes paid by jurisdiction, and summary of advance pricing agreements (APAs) or relevant resolutions.
- Why: it allows the authority to cross-check information between the documentation and the group’s aggregate results to detect inconsistencies or areas of higher risk.
Status of the Master File in Latin America (2025)
Below are the countries where it is mandatory and not mandatory.
Countries that REQUIRE a Master File
Mexico
- Mandatory for taxpayers exceeding certain income thresholds.
- Submitted annually to the SAT.
- Based expressly on BEPS Action 13.
Brazil
- With convergence to the OECD standard (Law 14.596/2023 and RFB Normative Instruction No. 2.161/2023).
- Required for multinational groups with consolidated revenues exceeding EUR 750 million.
Chile
- Mandatory since 2016 in accordance with OECD standards.
- Submitted to the Internal Revenue Service (SII).
- Required for multinationals with a presence in Chile.
Argentina
- Mandatory for taxpayers who exceed revenue thresholds or have relevant operations.
- Annual filing with AFIP.
Colombia
- Requires the Master File for taxpayers who exceed certain thresholds.
- Filed with DIAN.
- Aligned with BEPS Action 13 since 2017.
Peru
- Mandatory since 2017.
- Must be filed when income exceeds established thresholds and specific requirements are met.
- Aligned with the OECD Master File + Local File scheme.
Ecuador
- Mandatory for taxpayers who exceed certain income levels and related-party transactions.
- Submission to the SRI.
Uruguay
- The Master Report is generally required for entities belonging to multinational groups with consolidated revenues exceeding EUR 750 million (aligned with the Country-by-Country Report). You must verify whether the entity falls under the category of “Large Taxpayer” with special obligations.
Dominican Republic
- Mandatory since the amendment of the Transfer Pricing Regulations by Decree 256-21 (2021).
- Must be filed together with the Local File within 180 days of filing the Informative Return (DIOR).
Countries that DO NOT REQUIRE a Master File
Paraguay
- Requires only information returns and comparability studies, but has not adopted the Master File.
Bolivia
- Does not require a Master File.
- Its transfer pricing regime is more limited and less aligned with the OECD.
Venezuela
- Requires transfer pricing documentation, but not specifically a Master File under the BEPS standard.
Panama
- Taxpayers subject to transfer pricing must have the Master File available when filing the Informative Return (Form 930) and must submit it to the DGI if requested (within 45 days). It is not an annual “automatic submission,” but it is a preparation and retention obligation.
Trends in the region
- Brazil was the most significant change in recent years, adopting the OECD standard with the Master File.
- Each year, more countries are moving towards the Local File + Master File + Country-by-Country Report model.
- International pressure via the OECD, EU, and G20 is accelerating standardization.
- In several countries, even where it is not mandatory, the authorities already request equivalent information during audits (e.g., Panama and the Dominican Republic).
Conclusion
The Master File is already a requirement in most key Latin American countries, especially those with greater international economic integration: Mexico, Brazil, Chile, Argentina, Colombia, Peru, Ecuador, and Uruguay.
For multinational groups with regional operations, it is essential to align their global reporting with the OECD standard, review the specific thresholds for each country, and ensure that the information is available to all subsidiaries that require it.
Do you need specialized advice on transfer pricing documentation?
At TPC Group, we are transfer pricing specialists, with a team of experts in BEPS Action 13 and Latin American regulations to help you comply with the Master File, Local File, and Country-by-Country Report.
Contact us for a personalized assessment and ensure your multinational group’s tax compliance.
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