Price is a crucial component when determining the income taxable base. Non-integrated market participants (counterparties) are at a certain distance from each other (at arm’s length) and make transactions among themselves at prices formed under the influence of the market. This is the essence of the ‘arm’s length’ principle.

Transfer pricing is the setting of transfer prices that are different from market pricing, for deals between interdependent persons, which usually belonging to the same holding (group of companies).