In this article from BNA’s Tax Management Transfer Pricing Report, NERA Vice President Dr. Vladimir Starkov examines in detail the new transfer pricing regulations in Russia, which take effect on 1 January 2012. The new regulations stipulate that the safe harbor of 20-percent around the market price of comparable goods will no longer be sufficient to demonstrate compliance with the arm's length standard. Instead, new amendments to the Tax Code introduce full-scope transfer pricing regulations that constitute a significant step toward adapting the framework established by the Organization for Economic Cooperation and Development. Dr. Starkov notes that taxpayers with Russian operations will need to take proactive steps to ensure compliance with the new law. This includes taking an inventory of all controlled transactions, identifying controlled transactions subject to annual reporting to the tax authorities, aligning intercompany prices using available benchmarking information on arm’s length prices, and preparing transfer pricing documentation. Transfer pricing practitioners analyzing Russian-related transactions also will need to develop a good understanding of the information sources that provide pricing data and financials for Russian companies and develop comparables screening and adjustment procedures consistent with the regulations.