On 31 May 2018, the Court of Justice of the European Union (CJEU) issued its judgment in the case Hornbach-Baumarkt (C-382/16).
The underlying question in the case was whether transfer pricing rules (which apply only to transactions with foreign related companies) violate EU law if they do not allow for the possibility of a taxpayer proving that non-arm's length terms were agreed for commercial reasons.
The judgment has a significant practical impact on the tax treatment of cross-border transactions between companies within the same group.
