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Tuesday, 01 September 2020

The Transfer Pricing Law Review - Chapter 2: Belgium

Although the arm’s-length principle, which forms the basis of the framework of transfer pricing rules, has had a long international history, it was only explicitly introduced into Belgian legislation in 2004. The Belgian legislature used the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations Guidelines (the OECD Guidelines) and the OECD Model Tax Convention as inspiration.

Belgium does not incorporate all OECD principles and guidelines into law. Nevertheless, the tax administration recognises that the latest version of the OECD Guidelines is especially relevant in practice. The tax authorities use continuously revised and updated guidelines whereby the most recent version of the OECD Guidelines was issued in 2017, including the outcomes of the final 2015 Base Erosion and Profit Shifting (BEPS) Reports on Actions 8–10 ‘Aligning transfer pricing outcomes with value creation’ and on Action 13 ‘Transfer pricing documentation and country-by-country reporting’. In that respect, in the recently published Circular Letter concerning transfer pricing,3 the Belgian tax authorities confirmed the application of the 2017 version of the OECD Guidelines. The tax authorities even go one step further given that the date of entry into force of the Circular Letter, published in February 2020, is set retroactively for intercompany transactions taking place as from 1 January 2018. By way of exception, some paragraphs of the Circular Letter enter into force as from 1 January 2020, mainly parts related to interpretation by the Belgian tax administration or Belgian-specific issues.


You can read the full chapter on Belgium here.


For any questions, please reach out to our specialists:

Ahmed El Jilali - Senior Associate (

Heleen Van Baelen - Senior manager (

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