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Transfer pricing refers to the setting of prices for goods and services sold between controlled (or related) legal entities within an enterprise. This methodology is used to prevent tax evasion by artificially shifting income from high-tax jurisdictions to low-tax ones, and ensures that transactions between related entities are priced fairly and consistently with market rates. Transfer pricing policies must comply with local laws and regulations, as well as international guidelines established by organizations such as the Organisation for Economic Co-operation and Development (OECD). The goal of transfer pricing is to ensure that each entity within a multinational enterprise pays its fair share of taxes while also facilitating efficient cross-border trade and investment.