New Transfer Pricing Regulations: Argentina Implements Incentive Regime for Large Investments

October 30, 2024

Introduction

Recently, the Federal Administration of Public Revenues (AFIP), a public entity that will be replaced by the Customs Collection and Control Agency (ARCA), published a unified key regulation for the Incentive Regime for Large Investments (RIGI), establishing strict guidelines for the disclosure of information on Transfer Pricing. This regulation aims to promote transparency in transactions of large taxpayers, regulating in detail the documentation and annual reporting obligations.

Main Requirements in the Transaction Report

The regulation requires a detailed annual report for each entity subject to the regime, covering critical aspects in the Transfer Pricing documentation, such as:

  1. Group Structure: The report must include the structure of all entities involved, highlighting their role, location and operational links.
  2. Contracts and Reorganizations: Contracts on transfer of shares, mergers, and business reorganizations should be detailed.
  3. Supply Chain: The regulations require a description of the supply chain of the main products or services, explaining the service delivery arrangements and the transfer pricing policy employed.
  4. Intangible Assets and Strategies: It is mandatory to include a list of significant intangibles and the policies on Research and Development (R&D), as well as strategies for their development and exploitation.
  5. Transfer Pricing Method: Companies must justify the choice of Transfer Pricing method, explaining the rationale and adjustments applied to selected comparables, as well as the range of values used.

New Transparency and Control Requirements

This new AFIP (later ARCA) regulation emphasizes the importance of transparency and rigorous control in intercompany transactions, promoting fairer and more efficient Transfer Pricing practices. In addition, the regulation emphasizes the need for clear policies regarding intangible assets and marketing expenses, contributing to tax compliance and avoiding avoidance risks.

Conclusion and Call for Action

For companies operating in Argentina and carrying out intercompany operations, it is essential to know and comply with these regulations.

At TPC Group, our Transfer Pricing experts can help you adapt your strategies to comply with the new AFIP requirements.

Consult with us and ensure compliance of your international operations!

 

Source: Comercio y Justicia