What are there transfer-pricing rules in China?
Transfer pricing in China is governed by the Income Tax Law for Foreign Investment Enterprises and Foreign Enterprises, and The Law Concerning the Administration of Tax Collection. Further, the State Administration of Taxation has issued a number of rulings on the issue. The Chinese government has also adopted international principles. Accordingly inter company transactions should be prices according to the "arm's length principles". If firms are regarded as associated, which they are if one of the entities are owned or controlled by another entity, then the assets must be priced according to the arm's length transaction principles.
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