Morocco Transfer Pricing Regulations

Introduction

The Morocco Transfer Pricing Regulations were introduced in 2019 and are governed by the Articles 210, 213 and 214 of Moroccan General Tax Code(CGI).

• Article 210 of the CGI confers the tax administration with the rights to call for requisite documentation to justify arm’s length pricing in case of related party transactions and impose penalty in case of failure to produce information or on submission of insufficient information
• Article 213 of the CGI provides for tax authorities to make such adjustments as may be warranted where the related party transactions do not meet the arm’s length price
• Article 214 enforces documentation requirements specifically in relation to cross border transactions to enable tax authorities to verify and enforce arm’s length

While the Article 214 provided for requisite documentation to be maintained, it envisaged that a separate Decree would be issued to provide for the details, formats and modalities of the documentation to be maintained.

As a follow up, In November 2025, the Moroccan Government formally approved & published the Decree No. 2-22-1020, as an operational mechanism to implement the broad legislative rules established under the Article 214. The Decree aligns the Moroccan transfer pricing framework with the OECD BEPS Action Plan 13 by formalising the 3 tier documentation requirements and making it legally binding and enforceable during audits.

Transfer Pricing Regulations

Applicability
The transfer pricing regulations are applicable to:-

• Domestic as well as cross border related party transactions
• No de-minimis threshold for applying arm’s length pricing in respect of related party transactions

Documentation Requirements

• Follows three-tier documentation – Local File, Master File and Country-by-Country Reporting (CbCR)

Documentation applicability thresholds

• CbCR – MNEs having annual consolidated group revenues of atleast MAD 8.1billion in the preceding fiscal year are required file CbCR within 12 months from the end of the reporting financial year
• Master File & Local File–
  • If Entity’s annual turnover(excluding VAT) or total gross assets on the balance sheet are MAD 50 million or more
  • A materiality threshold for each category of transaction of 1 million MAD(excluding VAT) applies. If the aggregate value of the transaction category exceeds the said threshold then detailed documentation for such category of transaction is required, else the same can be aggregated with the core transactions in determination of arm’s length price

Filing and Audit Requirements

• There is no Transfer Pricing Return/ Disclosure form filing requirement
• TP documentation to be filed within 30 days of receipt of notice from Tax authorities.

Language of TP Documentation

• Documentation furnished can be in French or Arabic

Documentation Preservation Time

• The Transfer Pricing documentation shall be preserved on Company’s premises is that for a minimum of 10 years

Penalties for Non-Compliance

• Failure to produce above TP documentations- 0.5% of the value of transactions or with a minimum amount of MAD 200,000 for the said financial year
• Failure to file or submission of incomplete or late filing of Country-by-Country Report – Fine of MAD 500,000

Advanced Pricing Agreements (APA)

• Article 223 of the CGI codifies the right of any company liable to Corporate Income Tax in Morocco to request an Advanced Pricing Agreement (APA)
• The APA pre-establishes an appropriate selection of transfer pricing methodologies, comparable market benchmarks, and critical economic assumptions for specific upcoming cross-border related-party transactions. The application for APA must be filed to DGI, at least 6 months before the start of the first fiscal year that the agreement is intended to cover
• Validity: An APA entered remains legally binding for a period of 4 consecutive fiscal years. However, to maintain the validity of the entered APA, the entity must file annually an Annual Reporting Package to the DGI. Also, compliance with the pre-agreed terms and critical assumptions is required to be maintained

Way forward for Businesses

The Moroccan Transfer Pricing Regulations has been reinforced and strengthened by Decree 2.22.1020 making it imperative for businesses to maintain :-

• Robust intercompany agreements clearly defining the terms and conditions of the services/ intercompany transaction that should reflect the TP Policy and be aligned with commercial substance
• Comprehensive and contemporaneous TP Documentation justifying the arm’s length pricing
• Adequate back-up documentation like invoices, workings, emails etc to substantiate arm’s length pricing
• Considering the nature, complexity and the value of related party transactions, businesses may also evaluate the option of entering into an APA, keeping in mind the cost, effort and time involved in the said process