Michael McGrath (Cork South Central, Fianna Fail)
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185. To ask the Minister for Finance the transfer pricing standard the Revenue Commissioners is adhering to when considering transfer pricing arrangements being engaged in by multinational companies operating here; and if he will make a statement on the matter. [25954/14]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the internationally-recognised standard, which is arm's length pricing, is part of Irish tax law as set out in Part 35A of the Taxes Consolidation Act 1997 (TCA). This standard is applied to transfer pricing arrangements of multinational companies in accordance with the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations.

The arm's length standard is provided for in section 835C of the TCA and applies to arrangements between associated parties which involve the supply and acquisition of goods, services, money or intangible assets. Section 835C provides that where an amount receivable in respect of a sale is understated or an amount payable in respect of an expense is overstated, the arm's length amount will be substituted in each case.  The arm's length amount is the amount that would have been agreed between independent parties. Section 835D of the TCA provides that the arm's length standard, set out in section 835C, is to be construed in such a way as to ensure, as far as practicable, consistency with the OECD Transfer Pricing Guidelines.