24-12 rman this respect, it should be noted that the full-cost plus approach based on actual costs is mathematically identical to a comparable profits method( CPM) based on oper ating margin. Yet the first approach is accepted, whereas: the second is not (b Transactional Net Margin Method/ Comparable Profit Methe The TNMM(as well as the CPM) are not recognized as standard methods by the German Tax Administration. As with the profit split method, the administrative principles allow the use of a profit comparison in exceptional cases if"the standard methods do not generate adequate results due to special circumstances. 37 In this regard, the German interpretation of the profit-oriented methods is in line with the OECD, which accepts profit-oriented methods as last resort. However, in prac- tice, the German taxpayers and tax auditors have been reluctant to accept the TNMM/CPM () Method Selection. It is often argued that it is always possible to use the standard methods. Thus, the use of comparison of net margins as last resort is not necessary. This view is also reflected by a press release of the german ministry of Finance that was published following the release of the OECD Guidelines. The German government announced that it will not use TNMM, except in, cases of es- timation of profits or for a plausibility check. The general rejection of CPM now discussed is controversial after the Lower Tax Court of Dusseldorf did not allow the use of secret comparables. Since data are hardly available, it was argued that CPM is not feasible under German law. However, the tax court explicitly ac knowledged profit-oriented methods as a last resort. Also, in many cases, the profit comparisons do not even have to rely on German data if the tested party is located outside of Germany or if other European companies might be used as ce for a German company. Therefore, tax practitioners now seem to be more open to the use of profit-oriented methods. It is not yet clear if the Federal Tax Court will accept the case for a review and if, t would further analyze the acceptability of profit-oriented methods in such a review It should also be considered that after other major European countries have an nounced that they will accept the TNM, it seems very doubtful that Germany can keep its view disapproving of the TNMM. After taxpayers start to implement formal transfer pricing systems, it will become more common to rely on a profit- riented approach in order to receive more legal certainty over transfer pricin risk exposure. Moreover, many taxpayers have experienced that the official posi Comp. OECD Guidelines 33.50 Comp. press release of the Federal Ministry of Finance, July 13, 1995, IStR 1995, p. 384 See Borstel/Prick, Intemational Tax Review, April 1999, 9; Borstel/Prick, IStR 1999, 304. ternational Tax Review, July/August 1999, p. 9.. Pp 1599 ff. Schnorberger, IStR 1999,P. 523: Vogele,In See Kroppen/Eigelshoven, IWB Fach 3, Gruppe 1