Considerations on Icelandic Transfer Pricing Rules in Light of First District Court Ruling in Transfer Pricing Case

This article analyses Iceland’s first court ruling on transfer pricing, delivered by the District Court of Reykjavík. The case highlights the exceptionally high bar set for comparability analyses and emphasizes that the burden of proof lies with the taxpayer where documentation is not considered adequate. Notably, the Icelandic tax authorities maintain that it is not their role to develop or justify transfer pricing policies on behalf of taxpayers, reinforcing the need for robust, contemporaneous documentation and a defensible pricing methodology.