Contents

This section explains the processes and procedures relating to Advance Pricing Arrangements (APA).

The section contains the following:

• What is an APA? (C.D.11.15.3.1).
• Why request an APA? (C.D.11.15.3.2).
• The typical APA process (C.D.11.15.3.3).
• Which transactions may be covered by an APA? (C.D.11.15.3.4).
• The form of an APA request (C.D.11.15.3.5).
• Where to submit the request (C.D.11.15.3.6).
• Can an enterprise withdraw from an APA? (C.D.11.15.3.7).
• Critical assumptions (C.D.11.15.3.8).
• Must an enterprise pay for an APA? (C.D.11.15.3.9).
• For how long is an APA valid? (C.D.11.15.3.10).
• Can an APA be applied retroactively (roll-back)? (C.D.11.15.3.11).

See also

OECD's Guidance on the transfer pricing implications of the COVID-19 pandemic

When taxpayers and tax authorities have entered into an APA, critical assumptions are typically written into the agreement. Such critical assumptions may have been breached as a result of the COVID-19 pandemic, whereby the agreement may fall away or have to be renegotiated. It may also happen that the circumstances of the controlled companies make it impossible to maintain the APA that has been entered into. APAs are still valid for the year of COVID-19, and it cannot therefore automatically be assumed that the assumptions for an APA have been breached, or that the pricing according to the APA can be disregarded - neither by the taxpayer nor by the tax authorities. These matters are dealt with in Chapter IV of the special instructions under the following sub-headings:

• What impact does COVID-19 have on existing APAs?
• What impact does COVID-19 have on APAs under negotiation?