ABSTRACT
The regulation of transfer prices - or more broadly of the international allocation of the taxable profits 'of multinational enterprises (MNEs) - continues to be a vexing problem for governments, economists and the MNEs themselves. It is, of course, the international or interstate dimension of the fiscal conflict between sovereign jurisdictions and global enterprises that precipitates the issue of regulation. Transfer prices - on the accounting books or so-called 'shadow' prices - adopted for managerial purposes within a multidivisional enterprise as such create no fiscal conflicts, though they continue to produce managerial headaches and conundrums.
