Asia hosts some of the world’s most complex and interconnected supply chains. Goods commonly move through two or three jurisdictions before reaching their final market. As a result, a large proportion of trade in the region is conducted between related parties.

This makes multinational groups operating in Southeast Asia, China, India, Japan, South Korea and Australia more exposed when tariff or customs valuation scrutiny intensifies.

From US tariff measures to regional trade adjustments, Asian exporters and distributors are increasingly required to defend their pricing across multiple regulatory environments. In practice, this means transfer pricing teams must understand customs expectations-not as a separate task, but as an extension of pricing governance.

In Asia-Pacific, many groups use limited‑risk distributors, contract manufacturers and principal structures. These models rely heavily on maintaining arm’s length margins. Tariffs can disrupt these assumptions.

Examples include:

• Tariff increases reduce the profitability of import entities
• Absorbing tariff costs creates deviations from tested ranges
• Customs challenges affect the declared values used in TP calculations

For organisations following OECD or local guidelines across the region, these changes can push entities outside arm’s length ranges, often unnoticed until a year-end review or audit.

Customs authorities in Asia typically follow transaction‑level valuation rules, whereas transfer pricing relies on profit-based benchmarking. This misalignment can create inconsistent narratives across:

• Customs declarations
• Local entity financial statements
• Transfer pricing documentation

CFOs and Heads of Tax increasingly recognise that these inconsistencies can escalate regional audit exposure.

Many APAC subsidiaries manage customs matters independently, while transfer pricing is controlled regionally or centrally. This creates gaps in pricing governance.

An intercompany price may need to satisfy customs valuation rules in one country and transfer pricing rules in another-often with little alignment between the two.

Across Asia, customs and tax authorities are becoming more coordinated internally-even if they do not coordinate with each other. This increases the expectation for consistent documentation across regimes.

We work with clients to evaluate how tariff changes or customs valuation requirements affect arm’s length outcomes for APAC entities.

We assist in developing narratives and evidence that remain consistent across customs and transfer pricing requirements-without duplicating work.

Our team supports scenario planning that reflects the operational realities of APAC businesses, including multi-country manufacturing routes and principal structures.

We help clients review where customs declarations, intercompany agreements and TP documentation might conflict across APAC jurisdictions.

We support tax, finance, supply chain and commercial teams in understanding how decisions at the local level influence group transfer pricing compliance.