Centralized Procurement Models – TP Perspective
VSTN’s recent article on “Centralized Procurement Models – Transfer Pricing” co-authored by Nithya Srinivasan and Nitya Joseph was published in the CASC Monthly Bulletin for June 2025.
The article covers the topic of Centralized Procurement within the context of transfer pricing, exploring the key aspects to be considered in determining an arm’s length remuneration for the same, the various procurement structures generally adopted by MNEs and commonly used compensation models. It also highlights the importance of maintaining strong documentation to substantiate the level of functions carried out by the procurement centres.
Additionally, the article provides insights on international practices regarding centralized procurement as well as local and global jurisprudence.