An appeal was considered imminent last month, but on Friday in Sydney lawyers acting for Commissioner of Taxation Chris Jordan will seek a necessary extension of time.

It is understood the filing deadline was missed by just six minutes, meaning a potential full bench appeal might not proceed.

If Federal Court Justice Nye Perram decides not to allow the appeal, the tax revenue will be lost. Multinational taxpayers are waiting on the result of the case for certainty in the area of risk from cross-border contracts with related businesses.

Lower-tax loophole

Transfer pricing rules target multinational firms seeking to shift profits overseas. The rules are designed to limit an Australian taxpayer increasing expenses or reducing income through dealings with a related entity in a lower-tax jurisdiction.

The September 3 decision was the first major transfer pricing judgment since the landmark 2017 Chevron case, described as the most significant tax case ever litigated in Australia.

The ATO won that case, with the court ruling the terms of a loan between an Australian company and US subsidiary did not meet the arm’s length test.

The ATO was ordered to pay Glencore's legal costs in the latest case.


A spokeswoman confirmed the ATO had applied for an extension of time to file an appeal against the Federal Court’s decision on transfer pricing rules.

"It was necessary to apply for the extension as the filing of the notice of appeal was not completed within the closing time for filing," the spokeswoman said.

"In 2017, Glencore objected to three sets of amended tax assessments that arose as a consequence of the ATO finding that amendments made to an agreement between Glencore International AG and its Australian subsidiary were not arm’s length dealings.

"In September this year, the Federal Court found that the terms operating between the Australian copper mine and its Swiss trader parent to calculate the price at which the mine sold its entire copper concentrate production were within an arm’s length range."

The spokeswoman said the ATO appeal would seek to clarify the operation of transfer pricing rules.