M. Osvald, PhD student Taras Shevchenko Kyiv National University, Kyiv CONFLICT OF INTERESTS IN TRANSFER PRICING

In the conditions of globalization all the companies try to find the effective ways of maximizing their profit. One of the instruments is the system of the transfer pricing that helps to optimize the costs and allocate effective the resources of the company. Transfer pricing has detrimental effect on the economy of countries, though the governments use the regulations to minimize this effect on their economy. In this case the conflict of interests appears. Paper deals with an analysis of the functions and reasons of the economic agents which use the transfer prices to demonstrate the conflict of interests in transfer pricing. The purpose of the study is the determination of the best ways to solve the conflict situations in the process of transfer pricing according to the economic interests of the agents: company and government and within the company: headquarters and subsidiaries. The main point of resolving the conflict between company and government is to make clear regulations of transfer pricing for enterprises and productive relations between company and government. The methods to resolve the conflict within the company are: clear guidelines, decentralization and motivation for stuff members.

Keywords: transfer pricing, functions of transfer prices, agents of transfer pricing, conflict of interests, economic interest.

DOI: http://dx.doi.org/10.17721/1728-2667.2014/162-9/12

  1. Pashkus V.J. Transfer pricing: evolution of conception and current introduction // Vestnik Sankt-Peterburskogo universiteta. Serija 5 (Ekonomika). – SPb.: Izdatelstvo Sankt-Peterburskogo universiteta, 2001. – Vip. 4 – №29. – S. 61-70.
  2. Dzyuba P. Transfer pricing in financial system of TNC : Dis. … kand. ekon. nauk: 08.05.01. – K.:2005. – 210 s.
  3. Vahrushina M.A. Transfer pricind in pracicw of Russian organizations // Sovremennij buhuchet. – 2000. – №4 – s.4-14.
  4. Weber. Internationale Verrechnungspreise im Konzern, a.a, 2004, S.14.
  5. World Investment Report 2011 // http://unctad.org/Sections/dite_dir/docs/WIR11_web%20tab%2034.pdf [19.05.2014].
  6. ChumakovaO.O. Tax policy in transfer pricing: effectiveness and thin capitalization // http://www.kbuapa.kharkov.ua/ e-book/tpdu/2013-3/doc/2/17.pdf [19.05.2014].
  7. Illicit Financial Flows from Developing Countries: 2000 – 2009 // http://www.gfintegrity.org/storage/ gfip/documents/ reports/IFF2010/gfi_iff_update_report-web.pdf [18.05.2014].
  8. Instytut strategichnih doslisdzhen. Transfer pricing // http://ukrstrategy.com/uk/analitika/ item/56-transfert-cen.html [17.05.2014].
  9. Suhov S.M. Economic interests of agents of ecological insurance: avtoref. dis.… kand.ekon. Nauk / S.M. Suhov.-M., 2003.
  10. Bai S.I., Rymar I.A. Social function of enterprise / http://www.pu.if.ua/depart/Finances/resource/file/%D0%97% D0%B1%D1%96%D1%80%D0%BD%D0%B8%D0%BA/2011-2/%D0%91%D0%B0%D0%B9.pdf [18.05.2014].
  11. Shpakov E.Yu., Gvasaliia D.S. Social function of the government / http://www.rusnauka.com/ 15_APSN_2010/Economics/67943.doc.htm [18.05.2014].
  12. The Fund of Ukraine will be contributed with the half of billion through transfer pricing / http://weather.tsn.ua/groshi/byudzhet-ukrayini-popovnivsya-na-pivmilyarda-za-rahunok-transfertnogo-cinoutvorennya- 316451.html [19.05.2014].
  13. Starostina A.O. Industrial marketing: theory and business cases. Pidruchnik.Kyiv. Ivan Federov, 1997, 400s.
  14. Kanishchenko O.L. International Marketing in activity of the Ukrainian enterprises.Monografiya., – K.: Znannya, 2007, 446 s.
  15. Dligach A.O. Marketing pricing: international practices, national practices: Navchalniy posibnyk/ – K.: VD Profesional, 2006. – 225-228 s.
  16. Letzing J. Transfer pricing brings tax troubles to tech bigs: http://www.marketwatch.com/story/transfer-pricing-bringstax-troubles-to-tech-bigs-2012-04-02?pagenumber=1 [18.05.2014]