Once the MAP APA has been finally agreed, the participating tax authorities need to give effect to the agreement in their own jurisdiction. The tax administrations should enter into some kind of a confirmation or agreement with their respective taxpayers consistent with the mutual agreement entered into by the participating competent authorities. This confirmation or agreement would provide the taxpayer with the certainty that the transfer pricing transactions covered by the MAP APA would not be adjusted, so long as the taxpayer complies with the terms and conditions of the mutual agreement, as reflected in the domestic confirmation or agreement and has not made materially false or misleading statements during the process, including statements made in annual compliance reports. The terms and conditions would include certain assumptions which, if not met, might require an adjustment to be made or the agreement to be reconsidered.
TPG2022 Chapter IV Annex II paragraph 67
Posted on | By OECD
Category: OECD Transfer Pricing Guidelines (2022), TPG2022 Annex II to Chapter IV – Conduction of APA and MAP
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- TPG2022 Chapter IV Annex II paragraph 68 The way this confirmation or agreement is given will vary from country to country and the exact form will depend on the particular domestic law and practice. In some countries the confirmation or agreement will take the form of an APA under the relevant domestic procedure. To implement the mutual...
- TPG2022 Chapter IV Annex II paragraph 66 The MAP APA will be in the form of a written document and the content, layout etc. will be decided by the participating competent authorities. In order to achieve the objective of providing a clear record of the mutual agreement and for the agreement to be effectively implemented, the mutual...
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- TPG2022 Chapter IV Annex II paragraph 83 The validity of the transfer pricing methodology is dependent on the critical assumptions continuing to apply for the duration of the MAP APA. The MAP APA and any domestic confirmation or agreement should therefore require the taxpayer to notify the affected tax administrations of any changes. If, after evaluation by...
- TPG2022 Chapter IV Annex II paragraph 85 The revised MAP APA should state the date from which the revision is effective and also the date on which the original MAP APA is no longer effective. If the date of the change can be precisely identified, then normally the revision should take effect from that date but if...
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- OECD Publishes Manual on Bilateral Advance Pricing Arrangement On 28 September 2022 OECD published a new manual for entering bilateral advance pricing arrangement (APA’s) which has been approved by the Inclusive Framework on BEPS, as well as all members of the FTA, on 6 July 2022. The Bilateral Advance Pricing Arrangement Manual (“BAPAM” or “Manual”) is intended as...