Resumen.

The EU arm's length principle' gradually evolved into an 'EU arm's length tool' in the Starbucks, Fiat, Apple, and Amazon judgments of the General Court (GC) of the European Union. This article analyses in detail why a 'principle' progressed into a 'tool' in these judgments. For this matter, it considers the arm's length standard from the point of view of the regulation strategy of states (i.e., a reflexive regulation strategy) to govern the taxation of multinational companies. The author maintains that the regulatory design of the arm's length standard entails a choice for 'reflexive transfer pricing law' and subsequently relies on that perspective for analysing the judgments of the GC. This angle meticulously illustrates that the abuse of discretionary powers by the tax authorities in the process of monitoring the residual profit allocation of the taxpayer constitutes the relevant State aid problem. The article concludes that the GC eventually devised a rather toothless 'tool' that does not properly address this issue. At the same time, it also concludes that it should be relatively straightforward for the Court of Justice of the EU to finetune the 'EU arm's length tool' to establish an effective and foreseeable reconciliation of EU State aid law and transfer pricing law. For this matter, the article puts forward a concrete recommendation.