Italy vs Ilapark: JUDGMENT
Case Information
- Court: Supreme Court of Cassation, Italy
- Case No: 26432/2024
- Applicant: ILAPARK ITALIA SPA
- Defendant: Agenzia delle Entrate (Italian Revenue Agency)
- Judgment Date: 10 October 2024
The Italy v. Ilapark SPA case brings forward critical issues in transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of..., specifically the appropriateness of the selected transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... method for a business entity under Italy’s tax framework and its alignment with OECDThe Organisation for Economic Co-operation and Development (OECD) is an international organisation comprising 38 member countries, established to foster economic growth, trade, and development on a global scale. Founded in 1961, the OECD provides a forum for governments to collaborate, share policy experiences, and develop solutions to common economic challenges. The OECD's core mission is to promote policies that improve... guidelines. Ilapark Italia SPA, an Italian subsidiary within the Ilapak Group, was involved in a dispute with the Italian Revenue Agency over tax assessmentsA tax assessment is a formal determination made by a tax authority to calculate the amount of tax an individual or entity owes. It is a comprehensive evaluation based on financial records, declared income, expenses, deductions, and any applicable tax laws or regulations. Tax assessments may arise from routine self-assessments by taxpayers, or they may be conducted by revenue authorities... concerning intercompany pricing. The core issue was whether the chosen TP method accurately reflected the “normality” of prices in a manner compliant with Italian tax standards.