Online presentation of the draft Procedure for establishing compliance with the conditions of controlled transactions with raw materials under the arm’s length principle

On September 7th, the Ministry of Finance of Ukraine together with the Committee of Entrepreneurs on Tax Issues of the Ukrainian Chamber of Commerce and Industry / Ukrainian CCI presented the draft Procedure for establishing compliance with the conditions of controlled transactions with raw materials under the arm’s length principle.

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The draft document was prepared by the Ministry of Finance and the State Tax Service of Ukraine.

Expert and methodological support were provided by the EU4PFM project.

Presentation participants:

Svitlana Vorobey – Deputy Minister of Finance of Ukraine;

Paulius Majauskas – International Key Expert on Tax of the EU4PFM Project in Ukraine;

Lyudmyla Palamar – Director of the International Taxation Department of the Ministry of Finance of Ukraine;

Nadiya Goreva – Deputy Director of the Department – Head of the Department for Implementation of International Agreements and Mutual Agreements of the Department of International Taxation of the Ministry of Finance of Ukraine;

Vitaliy Synyavsky – Chief Specialist of the Transfer Pricing Department of the International Taxation Department of the Ministry of Finance of Ukraine;

Roman Goptsiy – Senior Project Manager of the Reform Support Office at the Ministry of Finance of Ukraine;

Kateryna Ryzhenkova – Head of the Transfer Pricing Department of the Tax Audit Department of the State Tax Service of Ukraine;

Konstantin Penskoy – Senior Project Manager of the EU4PFM project in Ukraine;

Olga Bohdanova – Advisor to the Deputy Minister of Finance of Ukraine, Managing Partner of Crowe Erfolg Ukraine;

Dmytro Mykhaylenko – Chairman of the Tax Committee of the Chamber of Commerce and Industry of Ukraine.

Event duration: from 14:00 to 16:30.

Format: online.

Live broadcast on FB: https://www.facebook.com/CroweAAUkraine

The draft Procedure for establishing compliance with the conditions of controlled operations with raw materials under the arm’s length principle (hereinafter – the Procedure) is designed to implement sub-clause 39.3.3.4. of subparagraph 39.3.3 of paragraph 39.3 of Article 39 of the Tax Code of Ukraine, recalled in the website of the Ministry of Finance of Ukraine.

During the presentation of the draft Procedure to be considered:

  • the structure of the document and approaches to its formation, the principles laid down;
  • priority of the method of comparative uncontrolled price, the possibility of using other methods of transfer pricing;
  • determining and making adjustments to comparability;
  • general approaches to establishing compliance of the conditions of the controlled operation for raw materials under the arm’s length principle (on the features of functional analysis, the definition of business models, choice of the party under research, external sources, adjustments, etc.);
  • application of the requirements of the Procedure for establishing compliance of the conditions of the controlled transaction under the arm’s length principle, including in the part of the information on the conditions of quotation prices for transactions:
  • on the export of grain, oilseeds, and products of their processing;
  • on the export of iron ore;
  • from the import of thermal and coking coal;
  • on imports of petroleum products and liquefied hydrocarbon gases;
  • on export and import of ferroalloys;
  • exports of pig iron, ferrous scrap, and ferrous metal products.

By September 21, 2021, the Ministry of Finance of Ukraine will be waiting for proposals, inquiries, or comments to the editions of the Procedure from the expert community.

The received proposals and issues will be discussed with experts and business representatives during a round table on September 23, 2021.

The work is going on!