International Law and Tax Cooperation: Transfer Pricing Rules and Their Impact on Nigerian Corporate Taxation

This study examines international tax cooperation frameworks and the application of transfer pricing rules to multinational companies operating in Nigeria, with particular focus on the Federal Inland Revenue Service (FIRS) Transfer Pricing Regulations and their alignment with OECD Guidelines and UN Tax Committee recommendations. Transfer pricing manipulation is a significant source of base erosion and profit shifting (BEPS) in Nigeria's oil and gas, telecommunications, and pharmaceutical sectors, resulting in substantial revenue losses that affect government capacity to fund public services. Using a professional tax law analysis methodology, the research analyses the arm's length principle as applied under Nigeria's transfer pricing regulations, the OECD/G20 BEPS Project outcomes relevant to Nigeria as an associate member, and the practical challenges faced by FIRS auditors in conducting transfer pricing examinations. It examines case studies of transfer pricing disputes between FIRS and multinational companies in the petroleum and consumer goods sectors, assessing the outcomes of tax assessments and disputes before the Tax Appeal Tribunal. The paper also considers Nigeria's participation in the African Tax Administration Forum and the OECD Inclusive Framework as mechanisms for strengthening transfer pricing capacity. Findings indicate significant institutional capacity gaps in FIRS that limit the effectiveness of transfer pricing enforcement, resulting in under-assessment of tax liabilities. Recommendations include investment in FIRS transfer pricing audit capacity, mandatory country-by-country reporting, and legislative updates to address digital economy transfer pricing challenges. Keywords: transfer pricing, BEPS, FIRS, international tax, multinational companies.