New Delhi (23.03.2026): Oil and Natural Gas Corporation (ONGC) has signed an Advance Pricing Agreement (APA) with the Central Board of Direct Taxes (CBDT), providing long-term tax certainty on a corporate guarantee extended to its overseas arm. The agreement pertains to financial arrangements involving ONGC Videsh Vankorneft Pte Ltd, a Singapore-based subsidiary of ONGC.
The APA establishes clarity on the tax treatment of the corporate guarantee, significantly reducing the risk of prolonged litigation and disputes with tax authorities. Such agreements are aimed at ensuring transparency and predictability in transfer pricing matters for multinational operations.
In a notable development, the agreement was finalized in just two months, considerably faster than typical APA timelines. This accelerated process highlights effective coordination among stakeholders, including ONGC, CBDT, and advisory firm KPMG.
The move is expected to streamline ONGC’s international financial structures and reinforce confidence in its cross-border transactions. It also reflects a broader push toward improving ease of doing business and tax certainty in India.
Advance Pricing Agreements are increasingly being used by large corporations to mitigate tax risks and ensure compliance with transfer pricing regulations. For ONGC, this agreement marks a step forward in aligning global operations with regulatory clarity and operational efficiency.
