Transfer Pricing in Asia Pacific: Key developments for multinational businesses

Transfer pricing requirements continue to evolve as multinational businesses respond to changing trade policies, regulatory developments and increased scrutiny from tax authorities.

The inaugural HLB Asia-Pacific Transfer Pricing newsletter examines these challenges, bringing together insights from our specialists across the region. This issue explores proposed changes to OECD guidance, the impact of global tariffs on intercompany pricing, and significant regulatory developments in Singapore, India and Malaysia.

For businesses operating across borders, the common priority is clear: ensuring transfer pricing arrangements remain commercially appropriate, properly documented and aligned with local requirements.

OECD proposes changes to intra-group services guidance

The OECD has proposed revisions to its Transfer Pricing Guidelines covering intra-group services, with greater emphasis on functional analysis, the benefit test, pricing methods and documentation.

Although the underlying arm's length principles are expected to remain unchanged, the proposals could influence how multinational groups demonstrate that services have been provided and justify related charges. Stakeholder feedback has highlighted the need for proportionate documentation and clearer distinctions between shareholder activities and chargeable services.

With the consultation completed and further discussions scheduled for November 2026, businesses should consider reviewing existing service arrangements and supporting evidence ahead of any final guidance.

Global tariffs create new transfer pricing challenges

Changing tariff policies are affecting supply chains, production costs and profitability across Asia-Pacific, with particular implications for manufacturing and distribution businesses. Our Thailand specialists examine how tariff-related pressures can challenge established transfer pricing arrangements, especially where subsidiaries operate under limited-risk models.

As business functions and commercial risks shift, existing benchmarking studies, tested-party selections and advance pricing agreements may no longer reflect operational realities.

Multinational groups should reassess their pricing policies and functional analyses, document the commercial reasons for adjustments and consider whether existing agreements remain appropriate. Proactive review can help businesses respond to trade disruption while managing potential tax disputes.

Regulatory developments across Singapore, India and Malaysia

Across Asia-Pacific, tax authorities are introducing targeted changes that affect transfer pricing compliance and dispute management.

Singapore has updated guidance on share-based compensation, introduced a pilot simplified approach for qualifying distributors and revised its indicative margin for certain related-party loans.

India's reforms include a new block assessment mechanism, expanded safe harbour provisions and increased use of advance pricing agreements, offering potential opportunities for greater certainty.

Meanwhile, Malaysia has introduced amendments with retrospective effect from the 2023 year of assessment, including a mechanism for offsetting adjustments.

These developments reinforce the importance of reviewing local compliance requirements alongside group-wide transfer pricing policies.

How HLB can help

Transfer pricing requires both a consistent international approach and an understanding of local tax requirements.

HLB's global network of transfer pricing specialists works with multinational businesses to develop and review intercompany pricing policies, undertake benchmarking analyses, prepare documentation, and address compliance and dispute-related matters.

Across Asia-Pacific, our member firms bring local regulatory knowledge and practical experience to cross-border arrangements, helping businesses respond to changing guidance, evolving supply chains and tax authority scrutiny.