Tax Treaty Case Law around the Globe 2025

Cristóbal Pérez Jarpa

1. Introduction

“Cintac S.A. con Servicio de Impuestos Internos Dirección Regional Santiago Poniente” (“Cintac case) is a case (reclamo tributario) that was decided on 24 October 2023 in the first instance by the First Tax and Customs Court of the Metropolitan Region (Primer Tribunal Tributario y Aduanero de la Región Metropolitana de Santiago [“Tax Court”]), Ruc 21-9-0000862-2, Rit GR-15-00162-2021. In the second instance, the Court of Appeal of Santiago (Corte de Apelaciones de Santiago), Rol 379-2023, confirmed the Tax Court’s decision. The case´s decision is still pending on appeal at the Supreme Court (Corte Suprema), Rol 49557-2024.

The case is complex regarding its facts, operations involved, and allegations. The Cintac case primarily deals with interpretation issues of transfer pricing rules regarding: (i) royalty payments related to a know-how contract and (ii) interest payments from investments loans. Both concern related parties offshore.

The Commentaries of the OECD Model Tax Convention (2010) and the OECD Transfer Pricing Guidelines (2010) were key as means of interpretation. This chapter mainly focusses on one part of the judicial dispute, i.e., tax ...