> In any quality legal system there's no such thing as "stretching the boundaries of legality".
Of course there is. Law is what's on the statute books and also how the courts interpret that. Some tax schemes seem to follow the letter of the law, but not the system, and the courts may well rule against them.
> Who is to say what Starbucks beans are worth?
There are a bunch of methods. You could use naive measures such as cost of beans + cost of roasting + transport and labour costs + X%; or you could compare market costs of other roasted beans; but it's probably a good idea to have a look at the effect of the expense of those beans on the company that they are sold to. And the beans are so expensive that the company make no profit, and thus avoids tax.
So I set X% to be whatever I need to minimise profit at my subsidiaries. Who are you to say X% is wrong? Did you build a successful coffee company?
Law is interpreted by the courts according to what it says, not according to what would be convenient at the time. This is why you hear about people getting off on a technicality. At least that's how it's supposed to work.
If you look at the right to be forgotten, the problem there is that the underlying law is so vague that basically anything can be read into it. So then judges end up legislating from the bench, which they aren't meant to do, that's why we have separation of powers.
How fondly I remember these types of discussions at the HFT company I worked for.
"We're not doing anything illegal.", they'd say. "The law allows for this."
I've learned that as soon as a company says something like that, they're doing something ethically shady.
Like applying for government funding when replacing whole datacenters full of slow, old, energy-slurping HP servers. How old? 6 months old.
"But these new machines are much more eco-friendly than the ones we're currently running. So we're entitled to government funding for replacing all those bad bad units with more eco-friendly units!"
After replacing those machines with more energy-efficient (and faster!) machines, we'd make more money in a day than most of us will make in a lifetime.
The 6 month old machines got scrap-heaped. With money that the Government was supposed to have spend on ecologically sound business cases.
We weren't doing anything illegal. But it sure felt like it.
The law does say that manipulating transfer pricing is illegal. However it is hard to prosecute where the thing being transferred is non tradeable (eg IP is sold to local subsidiaries in many od these cases not just coffee).
Of course there is. Law is what's on the statute books and also how the courts interpret that. Some tax schemes seem to follow the letter of the law, but not the system, and the courts may well rule against them.
> Who is to say what Starbucks beans are worth?
There are a bunch of methods. You could use naive measures such as cost of beans + cost of roasting + transport and labour costs + X%; or you could compare market costs of other roasted beans; but it's probably a good idea to have a look at the effect of the expense of those beans on the company that they are sold to. And the beans are so expensive that the company make no profit, and thus avoids tax.