{"id":3019,"date":"2025-10-01T13:40:00","date_gmt":"2025-10-01T13:40:00","guid":{"rendered":"https:\/\/gtmtax.com\/?post_type=insight&p=3019"},"modified":"2026-01-15T14:40:40","modified_gmt":"2026-01-15T14:40:40","slug":"whats-driving-transfer-pricing-scrutiny-and-how-companies-should-respond","status":"publish","type":"insight","link":"https:\/\/gtmtax.com\/insight\/whats-driving-transfer-pricing-scrutiny-and-how-companies-should-respond\/","title":{"rendered":"What\u2019s Driving Transfer Pricing Scrutiny \u2014 and How Companies Should Respond"},"content":{"rendered":"
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On September 25, some of the world’s top tax professionals gathered for a day of thought leadership and discussion on the evolving complexities of international tax law. The one-day summit, FUSION 2025, featured panelists from three different continents and seven countries \u2014 covering topics such as Pillar 2 updates, the impact of global trade wars, and trends among auditors in various regions of the world.\u00a0 <\/em><\/p>\n

Below, we\u2019re sharing some insights from a panel discussion focused on transfer pricing (TP) trends in Europe and Asia. With transfer pricing in transition, here\u2019s what global businesses need to know about audit, restructuring, and other TP pressures. The panelists for this session were Florian Gimmler, a Partner at WTS Germany, and Martin Ng, a Managing Partner at WTS China.<\/p>\n

Overview <\/strong><\/h4>\n

Transfer pricing \u2014 once treated as a routine compliance exercise \u2014 is now rising to the top of the strategic agenda for many multinational corporations. As global tax rules tighten and economic headwinds loom, TP is no longer an afterthought. It\u2019s being put under a microscope by tax authorities.<\/p>\n

With the rise of global minimum tax regimes, BEPS 2.0, and shifting supply chains, companies that once used simple intercompany pricing models are being forced to restructure how they attribute value and allocate profits across jurisdictions.<\/p>\n

Europe: From \u201cFish Markets\u201d to Forensic Audits<\/strong><\/h4>\n
Trend #1: Aggressive Tax Auditing <\/strong><\/h5>\n

Fifteen years ago, a German TP audit often looked like a simple \u201cfish market\u201d negotiation: Tax authorities would challenge one or two of that company\u2019s comparables, quibble over those items, and review their documentation. Ultimately, multinationals and German inspectors would usually land somewhere in the middle.<\/p>\n

That world is gone. In Europe, transfer pricing is currently under a lot more scrutiny. Tax officials not only comb through data to make their cases, but they also analyze a company\u2019s decision-making processes, business descriptions, and overall risk management.<\/p>\n

According to Florian Gimmler, transfer pricing today can look a lot like a thorough business-management review. \u201cAuthorities understand value chains to a very deep degree. They ask questions; they challenge price allocation,\u201d he says.<\/p>\n

German and other European tax authorities have fundamentally shifted how they examine transfer pricing:<\/p>\n