The arm's length principle and group dynamics - part 2 : solutions to conceptual shortcomings

This second part of the article deals with the effective application of the arm's length principle to the complex issues posed by group dynamics. The author first highlights the conceptual shortcomings discussed in Part 1. Then he presents possible solutions to these shortcomings, focusing in particular on profit split methods. He discusses residual profits methods, and the application of the arm's length principle to core segments and satellite segments of a multinational enterprise.