A New Approach to Transfer Pricing for Multinationals

Posted: 13 Apr 2004

See all articles by Markus Brem

Markus Brem

GTP GlobalTransferPricing Business Solutions GmbH; University of Augsburg


This paper aims at approaching the valuation of transactions between related parties of multinational companies with an updated arm's length approach. Based on transaction cost economics (TCE) and its related theory of the multinational firm, the paper takes the widespread criticism and shortcomings of the arm's length standard and asks for modifying allocation mechanisms. The paper proposes a three-step tax-world income allocation model which is more coherent with the business world of multinational companies. It is then suggested that such tax-world transfer pricing will release income allocation results in a more adequate fashion to global business processes.

Keywords: Transfer pricing, transaction cost economics, multinational firms

JEL Classification: K34, H25, L14, L22, L29

Suggested Citation

Brem, Markus, A New Approach to Transfer Pricing for Multinationals. Available at SSRN: https://ssrn.com/abstract=528922

Markus Brem (Contact Author)

GTP GlobalTransferPricing Business Solutions GmbH ( email )

Wertinger Straße 40
86368 Gersthofen (Augsburg)
+49 (821) 9089979 - 0 (Phone)
+49 (821) 9089979 - 89 (Fax)

HOME PAGE: http://www.GlobalTransferPricing.com

University of Augsburg ( email )

Universitätsstr. 2
Augsburg, 86159

HOME PAGE: http://https://www.uni-augsburg.de/de/fakultaet/wiwi/prof/bwl/schultze/team/markus-brem/

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics