In Commissioner of Taxation v. Glencore Investment Pty Ltd, the Full Federal Court has comprehensively reviewed Australia’s transfer pricing rules and dismissed the Commissioner’s appeal against the decision at first instance – where Davies J held that prices charged by the taxpayer to its Swiss parent, for the sale of copper concentrate, were “arm’s length”. The Full Court’s judgments include (i) a detailed discussion of the difficulties involved in predicting how independent parties, dealing at arm’s length, would price wholly controlled transactions; (ii) an acknowledgement of the practical issues facing taxpayers and the Commissioner alike, in demonstrating whether prices are, or are not, arm’s length; and (iii) a welcome endorsement of the need to use common sense in assessing transfer pricing outcomes.