5. Cash Pool Funds provided by MyPhone Financing SA (Cash Pool Leader Company Function) to MyPhone Argentina S.A. (LRD Company Function)
The following sections describe the controlled transactions including a comparability and functional analysis, selection and application of the transfer pricing method, and results and conclusion reached.
We have grouped the comparability and functional analysis and selection and application of the transfer pricing method for the controlled transactions described below as there are no material differences in comparability and functional analysis for these transactions. Therefore, the following controlled transactions are referred to collectively as Cash Pool Funds provided by MyPhone Financing SA (Cash Pool Leader Company Function) to MyPhone Argentina S.A. (LRD Company Function) throughout this section of the report.
| Providing Company | Receiving Company | Transaction Type | Amount | Notes |
|---|---|---|---|---|
| MyPhone Financing SA | MyPhone Argentina S.A. | Cash Pool Funds | ARS 40,000,000 | |
| Total: ARS 40,000,000 |
5.1. Overview of Transaction
5.1.1. Description of Controlled Transaction
Cash Pool Funds are provided by MyPhone Financing SA (Cash Pool Leader Company Function) to MyPhone Argentina S.A. (LRD Company Function). Cash Pool Funds are funds withdrawn from or deposited into a cash pool by cash pool participants. The cash pool is operated on a notional basis, with the Cash Pool Leader acting as the central counterparty to all intercompany balances.
MyPhone Argentina S.A. participates as a net borrower in the group cash pool arrangement. Balances are settled on a rolling basis with interest accrued monthly. The intercompany interest rate applied is reviewed annually to ensure alignment with arm's length rates for comparable short-term financing arrangements.
5.1.2. Transfer Pricing Policy
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5.1.3. Comparability and Functional Analysis
MyPhone Financing SA acts as the group's central treasury entity and cash pool leader. It sources funds from external financial markets, manages group-wide liquidity, and on-lends to subsidiaries at rates that reflect the credit standing of the group. It bears the credit risk of non-repayment by pool participants and manages associated foreign exchange and interest rate exposure.
MyPhone Argentina S.A. is a limited-risk distributor that participates in the pool as a net borrower to fund working capital requirements. It does not bear any significant treasury risk and relies on the Cash Pool Leader for liquidity management. The distribution entity is selected as the tested party for benchmarking purposes.
5.2. Selection of Transfer Pricing Method
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The Comparable Uncontrolled Price (Financial Analysis) method has been selected as the most appropriate transfer pricing method for this transaction. Under OECD TPG Chapter II, the CUP method is preferred for financial transactions where reliable comparable market rates can be identified and adjusted for differences in credit risk, maturity, and currency.
Alternative methods were considered and rejected: the Cost Plus method was not applied as the Cash Pool Leader's remuneration is more appropriately measured by reference to an interest rate rather than a mark-up on treasury costs. The TNMM was considered as a fallback but the availability of reliable CUP comparables made it unnecessary for this transaction.
5.3. Economic Analysis
5.3.1. Application of CUP
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A set of arrangements was identified which can be used as a Benchmark for the interest rate for Cash Pool Funds. The search was conducted using publicly available data sources including Bloomberg, Reuters Eikon, and the ECB statistical data warehouse, covering the period 1 January 2025 to 31 December 2025.
As a result of the search, a set of 7 comparable arrangements was identified. Arrangements were filtered to include only short-term (less than 12 months) unsecured lending between unrelated parties denominated in Argentine Pesos (ARS) or adjusted for currency differentials where USD-denominated comparables were used.
The range of interest rates was as follows:
| Range | |
|---|---|
| Q1 | 0.53% |
| MED | 1.03% |
| Q3 | 2.03% |
5.3.2. Comparability Adjustments
Adjustments were made to the identified comparables to account for differences in credit risk between the uncontrolled borrowers and MyPhone Argentina S.A. A credit rating proxy was established for MyPhone Argentina S.A. using the Moody's RiskCalc model, resulting in an implied rating of BB+. Comparable transactions involving borrowers rated between BB and BBB– were retained; transactions outside this band were excluded. No further adjustments for maturity or currency were required as the selected comparables are denominated in ARS with maturities of 90–365 days, consistent with the tested transaction.
The adjusted arm's length range for the applicable period is set out in the table above. The intercompany interest rate applied to the Cash Pool Funds provided to MyPhone Argentina S.A. falls within this range. No additional adjustment is therefore required.
5.3.3. Outcome of Analysis
Based on the comparability analysis and application of the CUP method, the interest rate applied to the intercompany Cash Pool Funds transaction is consistent with the arm's length range. The transaction is therefore considered to be priced at arm's length for the purposes of transfer pricing documentation in the fiscal year under review.
5.4. Conclusion
within the weighted average range of 0.53% - 2.03% with a median of 1.03%. It can therefore be concluded that this Intercompany Transaction was performed at Arm's Length.
above the weighted average range of 0.00% - 0.00%.
6. MyPhones provided by MWH (Central Entrepreneur Company Function) to MyPhone Argentina S.A. (LRD Company Function)
This section sets out the comparability and functional analysis, selection of transfer pricing method, and economic analysis for the controlled transaction involving the supply of MyPhone hardware products by MWH (Central Entrepreneur) to MyPhone Argentina S.A. (LRD) for onward distribution in the Argentine market.
| Providing Company | Receiving Company | Transaction Type | Amount | Notes |
|---|---|---|---|---|
| MWH (Central Entrepreneur) | MyPhone Argentina S.A. | MyPhones | ARS 312,000,000 | |
| Total: ARS 312,000,000 |
6.1. Overview of Transaction
6.1.1. Description of Controlled Transaction
MWH acts as the group's Central Entrepreneur, owning the MyPhone intellectual property and controlling the global supply chain. MyPhone Argentina S.A. purchases finished MyPhone devices from MWH for distribution in Argentina under the group's established pricing policy. The transaction covers all MyPhone device categories including smartphones, accessories, and service bundled hardware.
The commercial terms provide for delivery DDP (Delivered Duty Paid) to MyPhone Argentina S.A.'s principal warehouse in Buenos Aires, with payment terms of net 60 days from invoice date. Prices are set in USD and converted to ARS at the spot rate prevailing on the invoice date. Currency risk is borne by MyPhone Argentina S.A. in its capacity as a limited-risk distributor.
6.1.2. Transfer Pricing Policy
6.1.3. Functional Analysis
MWH performs the central entrepreneurial functions including product development, brand management, supply chain coordination, and pricing authority. It owns the MyPhone trademarks and patents and licenses these to distribution entities on an arm's length basis through a separate royalty arrangement.
MyPhone Argentina S.A. performs routine distribution functions: warehousing, local marketing execution within centrally approved budgets, sales force management, and customer service. It does not own significant intangibles and bears limited operational risks under the group's risk allocation framework.
6.2. Selection of Transfer Pricing Method
The Transactional Net Margin Method (TNMM) has been applied as the most appropriate method for this transaction, with MyPhone Argentina S.A. as the tested party. The TNMM compares the net profit margin of the tested party to those of comparable independent distributors performing similar functions and bearing similar risks.
The Resale Price Method (RPM) was considered as the primary OECD-preferred method for distribution transactions but was rejected on the basis that reliable resale margin comparables for consumer electronics distributors in the Argentine market could not be identified with sufficient reliability.
No data is included in TP Method explanation (TP Method). You may click here to complete it.
6.3. Economic Analysis
6.3.1. Benchmarking Search
A database search was conducted using Bureau van Dijk's Orbis database to identify independent companies performing distribution functions comparable to those of MyPhone Argentina S.A. The search covered the period 2022–2024 (three-year weighted average). After applying quantitative and qualitative filters, a final set of 12 comparable companies was identified.
| Range (Operating Margin) | |
|---|---|
| Minimum | 1.2% |
| Q1 | 2.8% |
| Median | 4.1% |
| Q3 | 5.9% |
| Maximum | 8.3% |
6.3.2. Result
The operating margin achieved by MyPhone Argentina S.A. for the fiscal year under review was 3.8%, which falls within the arm's length range of 2.8%–5.9% (interquartile range). No further adjustment is required. The transaction is considered to be priced at arm's length.
6.4. Conclusion
Based on the application of the TNMM and the benchmarking analysis described above, the transfer prices applied to the supply of MyPhone devices by MWH to MyPhone Argentina S.A. result in an arm's length return for the tested party. The operating margin of MyPhone Argentina S.A. falls within the identified arm's length range and no pricing adjustment is required for the fiscal year ended 31 December 2025.
within the interquartile range of 2.8% – 5.9% with a median of 4.1%.