A comparative analysis of the Brazilian and Norwegian Transfer Pricing System within the areas of thin capitalisation, interest and service regulations: Is there a difference in the approach to the arm s length principle under their domestic legislations that could lead to double taxation issues? If so, could this be solved by the Double Taxation Agreement between both countries?

Abstract

As a whole, the current thesis presents us with a comparative analysis of the Norwegian and Brazilian TP domestic regulations; in the context of the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital, ratified by both countries in 1981, and the OECD Transfer Pricing Guidelines. This will be achieved in the basis of the following structure: Part 1 will present an overview of the governmental approach for TP for Brazil and Norway, in an international context, complemented by the relevance TP has for the countries petroleum sector; Part 2 analyses the Norwegian and Brazilian domestic TP legislation, the approach tax authorities have to TP issues and is complemented by the practical implications the OECD model has in their jurisdictions; Part 3 addresses the countries specialized TP legislations regarding: thin capitalisation, services and interest regulations, as the main areas of economic relevance for the petroleum sector and; finally Part 4, connects the relevant points addressed in Part 3, with the content of the Double Taxation Agreement between Norway and Brazil (1981), analyzing the impact they can have regarding the avoidance of double taxation issues between Norway and Brazil.