A multi-national enterprise ("MNE") is two or more firms, located in different countries, but under common control, with a common pool of resources and common goals. Transfer prices are the prices at which MNEs transfer goods and intangible property (e.g. technology), or provide services, to associated enterprises. Canada is a relatively high tax jurisdiction. A MNE which is not subject to market discipline can manipulate its intra-firm transfer prices so that profits can be shifted from Canada into jurisdictions with lower tax rates. The Canada Customs and Revenue Agency ("CCRA") is justifiably well aware of the potential for using creative pricing to reduce Canadian taxes.

type Canada's Transfer Pricing Regime