For several years, the standard defensive approach for a captive Global Capability Centre (GCC) facing an Indian Transfer Pricing Officer (TPO) has been fairly mechanical: apply TNMM on an operating cost base, benchmark against routine service-provider comparables, and settle within the accepted cost-plus range. A jurisdiction briefing circulated this week for International Tax Review describes FY2025-26 as a year in which TPO scrutiny of GCC margins and intra-group services intensified, with officers moving toward fewer but deeper adjustments. The advisory response is to segment the GCC into three separately tested activities, namely support, delivery, and decision-rights, with each priced on its own terms rather than blended into a single entity-level margin.
This approach aligns with the OECD's current work at the multilateral level. The OECD has published the full set of public comments on its proposed rewrite of Chapter VII, which governs intra-group services, ahead of a consultation meeting scheduled for November in Paris. Practitioner submissions describe the draft as a substantive rewrite rather than a tidy-up: it requires accurate delineation of what was actually done, by whom, and under what conduct, as the necessary first step before any pricing method is chosen, and it expands the benefit test that has long been the fault line in service fee disputes. Read together, the Indian advisory and the OECD draft point in the same direction: MNEs are being asked to stop pricing services as a single blended category and instead demonstrate, activity by activity, that a real economic function occurred and that an independent party would have paid for it.
This advice may be harder to execute than it appears, not because of documentation gaps in the traditional sense but because of a shift underway in how GCCs operate. India's GCCs are moving away from task-by-task human execution toward agentic AI systems that plan and execute multi-step workflows autonomously. Industry commentary has described Google's move from single-task AI assistants to an agent platform that can be deployed, supervised, and audited across a company's systems as a development that could affect the labour-arbitrage economics on which the GCC sector was built. Separately, EY's GCC survey work finds a large majority of centres already testing agentic technology, with over half piloting agent-based systems specifically. Inside a GCC, this means a workflow once visibly split between a junior analyst performing support work and a senior lead exercising decision-rights judgment can now be executed end-to-end by a single agent, or by a human-agent pair, in a manner not observable from outside the system the way an organisation chart or job description made it observable five years ago.
The Indian TP advisory recommends segmenting the GCC into three tested activities before benchmarking. The OECD requires accurate delineation of the transaction before pricing it. Both instructions assume a documentable boundary between routine support and higher-value decision-making that a TPO or comparability analyst can observe and test. Agentic AI does not necessarily respect that boundary. If an exception-handling agent inside a GCC performs functions that combine what used to be tier-1 support and tier-2 judgment, the functional analysis section of the Local File, which describes who does what, would either need to become considerably more granular about which agent or human made a given call, or risk reverting to the blended, entity-level treatment that both the OECD and Indian practice are trying to move away from.
The practical question is not whether AI adoption in GCCs is occurring; the survey data and industry commentary indicate that it is. It is whether the functional-segmentation and accurate-delineation frameworks currently being refined by the OECD and recommended by Indian advisors were designed for a labour model that may be changing faster than the guidance can be finalised. If accurate delineation depends on establishing what was actually done and by whom, and 'whom' increasingly means a shifting combination of humans and autonomous agents operating across functional boundaries that were previously organisationally distinct, this raises a documentation question that neither the OECD's November consultation agenda nor the Indian safe harbour and Local File templates currently address in detail. For practitioners, the practical implication is to start building functional analyses capable of tracking agent-level activity now, rather than waiting for the guidance to catch up.
