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Transfer Pricing Disputes In The United States, Reuven S. Avi-Yonah

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In 1988, the US Treasury Department published a study of inter-company pricing (the 'White Paper') that included the following endorsement of the so-called arm's length standard (ALS) for examining the reasonableness of transactions between related parties for tax purposes: The arm's length standard is embodied in all U.S. tax treaties; it is in each major model treaty, including the U.S. Model Convention; it is incorporated into most tax treaties to which the United States is not a party; it has been explicitly adopted by international organizations that have addressed themselves to transfer pricing issues; and virtually every major industrial nation …