Transfer Pricing Documentation and The CbCR under BEPS Actİon 13: An Analysis of The Turkish Practice

Abstract

The OECD’s Base Erosion and Profit Shifting (BEPS) Project provides a solution for the transfer pricing problem through documentation and international exchange of information in BEPS Action 13, titled “Transfer Pricing Documentation and Countryby-Country Reporting”. This documentation is founded on a three-tiered standardized approach; the master file, the local file, and the country-by-country report (CbCR). Türkiye also follows this progressive approach, and the necessary legal framework has recently been modified to align with BEPS Action 13. The documentation in Türkiye includes the Master File, the Annual Transfer Pricing Report, the Form on Transfer Pricing, Controlled Foreign Companies, and Thin Capitalization (Camouflaged Capital) as of today. However, the legislation diverges from the action plan in some aspects. This study aims to evaluate the idealized body of BEPS Action 13 and examine the applicability of this normative action plan (i.e., the Model Legislation) in positive law by analyzing the Turkish practice.