Intercompany Recharge Agreement Template for Philippines

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Key Requirements PROMPT example:

Intercompany Recharge Agreement

"Need an Intercompany Recharge Agreement under Philippine law for IT support services provided by our Manila tech hub to three Southeast Asian subsidiaries, with implementation planned for January 2025 and specific focus on transfer pricing compliance."

Document background
The Intercompany Recharge Agreement is essential for multinational companies operating in the Philippines that need to establish a formal framework for charging services and allocating costs between related entities. This document is particularly important given the Philippines' strict transfer pricing regulations and tax compliance requirements. It should be used when group companies provide services to each other and need to document the basis for charges in compliance with Philippine transfer pricing rules, especially Revenue Regulations No. 2-2013 and BIR Revenue Regulations No. 19-2020. The agreement typically includes detailed service descriptions, pricing methodologies, documentation requirements, and tax considerations specific to the Philippine jurisdiction. It serves as crucial evidence for tax authorities during audits and helps demonstrate that intercompany transactions are conducted at arm's length.
Suggested Sections

1. Parties: Identification of the service provider and recipient companies, including registration details and addresses

2. Background: Context of the agreement, relationship between the parties, and purpose of the recharge arrangement

3. Definitions: Key terms used throughout the agreement

4. Scope of Services: Detailed description of services to be provided and recharged between the parties

5. Calculation of Charges: Methodology for calculating recharges, including cost allocation methods and markup principles

6. Payment Terms: Timing and method of payments, currency, and invoicing requirements

7. Transfer Pricing Compliance: Provisions ensuring compliance with Philippine transfer pricing regulations

8. Records and Documentation: Requirements for maintaining supporting documentation for recharges

9. Tax Provisions: Treatment of applicable taxes, including VAT and withholding tax obligations

10. Term and Termination: Duration of the agreement and termination provisions

11. Confidentiality: Protection of confidential information exchanged under the agreement

12. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

Optional Sections

1. Intellectual Property Rights: Used when services involve the use or creation of intellectual property

2. Regulatory Compliance: Added when specific industry regulations apply to the services

3. Force Majeure: Include when parties want specific provisions for unforeseen circumstances

4. Data Protection: Required when personal data processing is involved in the services

5. Audit Rights: Include when parties want specific audit provisions beyond standard records requirements

6. Foreign Exchange Provisions: Include when transactions involve foreign currency exchanges

7. Service Level Requirements: Used when specific performance standards need to be maintained

8. Dispute Resolution: Optional detailed procedures for handling disputes before litigation

Suggested Schedules

1. Schedule 1 - Service Descriptions: Detailed descriptions of each service category being recharged

2. Schedule 2 - Pricing Methodology: Detailed calculation methods, including cost pools and allocation keys

3. Schedule 3 - Mark-up Schedule: Applicable mark-ups for different types of services

4. Schedule 4 - Supporting Documentation Requirements: List of required documentation for each type of recharge

5. Schedule 5 - Key Personnel: List of key contacts responsible for managing the recharge process

6. Appendix A - Service Level Metrics: Specific performance indicators and measurement criteria

7. Appendix B - Template Reports: Standard formats for recharge reports and invoices

8. Appendix C - Transfer Pricing Documentation: Required transfer pricing forms and documentation templates

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant Industries

Manufacturing

Technology

Financial Services

Professional Services

Shared Services

Retail and Consumer

Healthcare

Energy and Resources

Telecommunications

Real Estate

Industrial Products

Business Process Outsourcing

Relevant Teams

Finance

Legal

Tax

Treasury

Compliance

Shared Services

Financial Planning and Analysis

Transfer Pricing

Corporate Governance

International Tax

Group Accounting

Financial Operations

Relevant Roles

Chief Financial Officer

Finance Director

Tax Director

Legal Counsel

Transfer Pricing Manager

Group Financial Controller

Compliance Officer

Treasury Manager

Shared Services Director

Financial Planning Manager

Tax Compliance Manager

Corporate Counsel

International Tax Manager

Finance Operations Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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