ANAF has published a draft order that would update Romania's transfer pricing regime to reflect the 2022 OECD Guidelines, replacing Order no. 442/2016 with stricter documentation, comparability, and disclosure requirements for related-party transactions.
Romania’s National Agency for Fiscal Administration has issued a draft order of the President regarding the thresholds of transactions, deadlines for preparation, content and conditions for requesting the transfer pricing file, and the procedure for adjusting/estimating transfer prices.
The primary objective of the draft order is to align national legislation with the 2022 OECD Guidelines, ensuring that domestic rules reflect modern international standards for multinational enterprises.
Key changes include updated transaction thresholds, more rigorous requirements for comparability analyses, and clearer instructions for documenting intra-group financial transactions. By establishing a more predictable legal framework, the government aims to improve taxpayer compliance and reduce disputes between businesses and tax authorities. Ultimately, these measures seek to ensure that all transactions between affiliated parties strictly adhere to the arm’s length principle.
Alignment with international standards
The primary driver for this new order is the need to align national regulations with the 2022 update of the OECD Transfer Pricing Guidelines. These guidelines integrate developments from the BEPS (Base Erosion and Profit Shifting) project, introducing clearer orientations on functional analysis, intra-group financial transactions, and business restructurings. This update replaces the previous framework (Order no. 442/2016), which was based on outdated OECD versions.
Enhanced documentation requirements
The order strengthens and modernises how taxpayers must document their related-party transactions, with four key changes:
- Alignment with OECD standards: The transfer pricing file content is brought in line with the OECD’s 2022 framework, ensuring consistency with current international norms.
- Clearer obligations: Documentation requirements are now specified separately for each affiliated party and each type of relevant transaction, removing ambiguity about what must be documented and for whom.
- Stronger functional analysis: New detailed rules govern how the functional analysis must be conducted, including defining the functional profile of the tested party and requiring justification for the profitability indicators selected.
- Revised thresholds: The significance thresholds (cuantumul tranzacțiilor) that trigger documentation requirements are restructured by transaction type, better targeting the actual fiscal risk each category poses.
Tightening of comparability rules
The order tightens transparency and methodology standards for comparability studies. It clarifies how taxpayers should sequence their geographic search for comparable companies and sets out clearer rules on using multi-year data in the analysis. Alongside this, taxpayers face stricter disclosure requirements: they must now share their full search strategy, provide lists of companies rejected during the comparables selection process, and disclose the specific formulas applied in their quantitative analyses.
Specialised transactional guidance
The rules provide specific guidance for complex or common intra-group transactions, including pass-through costs that are recharged without a profit margin, as well as transactions involving intangible assets and business restructurings, ensuring appropriate treatment and compliance.
Administrative procedures and estimation
The order clarifies the consequences of non-compliance by defining when a transfer pricing file is considered incomplete and specifying the circumstances under which the tax authority may estimate transfer prices due to insufficient or missing documentation.
Objectives and expected impact
The overarching goal is to establish a predictable and coherent regulatory framework by aligning terminology and procedures with the current fiscal code. ANAF aims to enhance voluntary taxpayer compliance, improve the quality of transfer pricing documentation, minimise disputes arising from inconsistent interpretations, and ensure the consistent application of the arm’s length principle in line with EU standards.
