The subject-matter of the article is the analysis of the draft directive on the harmonization of transfer pricing in the EU, submitted by the European Commission on 12 September 2023. The assumptions of the European Commission's proposal were discussed from the perspective of the main challenges characteristic of transfer pricing, the area of income taxes, i.e. the lack of coherence of legal provisions on an international scale, and the essential role of subjective expert judgment in applying in practice the basic legal norm of transfer pricing - the arm's length principle. The aim of the elaboration is to demonstrate that the harmonization of transfer pricing regulations in the EU will improve the situation related to inconsistency of legal provisions, but does not contain sufficient tools to prevent tax disputes between taxpayers and tax administrations arising as a result of the basic challenge of transfer pricing: the subjective nature of the valuation of transactions between related entities for tax purposes.