Wednesday, 12 January 2022

Updated Transfer Pricing Country Profiles published by the OECD – Part 2, including Belgium

Further to our previous newsflash regarding the updated transfer pricing country profiles published by the OECD in August 2021, the OECD has released a second batch of updated and new transfer pricing country profiles for 21 countries on 13 December 2021. This brings the total number of countries covered to 63. The updates include, in line with the first batch, two new sections that cover the transfer pricing treatment of financial transactions and the application of the Authorised OECD Approach (AOA) to attribute profits to permanent establishments. The OECD indicated that more updates to the transfer pricing country profiles are expected in the first half of 2022. We will keep you posted on updates.

The transfer pricing country profiles encompass up-to-date information on the countries’ legislation, such as on the arm's length principle, the transfer pricing methods, comparability analysis, intangibles, intra-group services, cost contribution agreements, transfer pricing documentation, administrative approaches to avoiding and resolving disputes, safe harbours and other implementation measures. The 2 new sections (financial transactions and AOA) were now added to the updated country profiles.

In this second batch, the country profiles of the following countries were updated or added:

Albania (new)



Maldives (new)

















Kenya (new)


Belgium is one of the countries for which the document is updated. The previous version was dated October 2017. Hereafter, we highlight some updates that are worth mentioning.

  • The update includes that Belgium follows the OECD Transfer Pricing Guidelines in a more direct manner compared to the previous version.

  • Reference is made to the Belgian Circular Letter of 25 February 2020 with respect to transfer pricing (hereafter “Circular Letter”). In this Circular Letter, the preference of the Belgian tax administration on certain topics is included.

  • Reference is made to the HTVI (“Hard To Value Intangibles”) implementation questionnaire, which can be found at the same link as the country reports. The documents (published since 2020) are intended to provide jurisdiction-specific information to get a better understanding of the extent to which the HTVI approach described in Chapter VI of the Transfer Pricing Guidelines has been adopted and is applied in practice by countries around the world.

  • A remarkable note with respect to this Circular Letter, is that for the new section on financial transactions, the country report specifically refers to the Circular Letter and not to the OECD Transfer Pricing Guidelines (as opposed to other topics where references are generally made to the OECD TP Guidelines). Whereas at the moment this Circular Letter was published, we made certain important and detailed remarks (that can be accessed here), we here again would like to stress that a Circular Letter is binding for the tax administration, but not for the taxpayer. This is mainly relevant for taxpayers to consider in cases where the preference of the Belgian tax administration incorporated in the Circular Letter may not (per definition) be in line with the arm’s length principle or the OECD Transfer Pricing Guidelines. Furthermore, there are some fundamental discrepancies between the Circular Letter and the (literal) reading of the 2017 OECD TP Guidelines (including the basic translation of the arm’s length principle) and also the entry into force is relevant to consider (caution should be exercised that the Belgian administration does not use guidelines that were not yet available in the relevant tax years under audit – also tackled in more detail in this article).  For taxpayers it is therefore key, in our view, to follow the OECD Transfer Pricing Guidelines and not to rely (blindly) on this Circular letter.

  • With respect to “other rules outside transfer pricing that are relevant for financial transactions”, reference is made to the interest limitation rules (further to BEPS action 4).

  • Another small addition in the new report is the “CBC NOT form” (notification by a Belgian taxpayer in which details are provided on the CBC report), which was not yet formally included as a “check-the-box” item in the previous country profile (whereas it was already in place in Belgium).

  • Furthermore, Belgium incorporated some additional practical information regarding bilateral and multilateral APAs. Reference is also made to Circular 2018/C/27 regarding the rules on dispute resolution in respect of the application of international tax treaties, ICAP (OECD International Compliance Assurance Programme) and CTCP (Co-Operative Tax Compliance Programme).

  • Another interesting note is that it the report states that secondary adjustments “are theoretically possible but practically Belgium did not make use of them yet”.

  • On the Attribution of Profits to Permanent Establishments, it is included that Belgium follows the AOA approach and some more information is provided on the applicability of the various versions (2008 versus 2010) related to the applicability of the MTC to certain double tax treaties.

The transfer pricing country profiles can be found on the website of the OECD.

If you have questions or would like to obtain more information on this topic, do not hesitate to contact the authors:

Stefanie Van heugten – Senior Consultant

Ben Plessers – Senior Manager