Transfer pricing is a relatively new issue in the People's Republic of China. China opened its door to foreign investors in the late 1970s and multinational enterprises brought their transfer pricing practices to China. It was not until 1991 that China enacted the first transfer pricing law. As...

This paper provides a critical analysis of the potential significance of the notion of location specific advantages in transfer pricing. It explains why China proposed this notion and how China has attempted to apply the notion in its transfer pricing assessment. It suggests that this notion can...