Transfer pricing

3 How MAP - 3.4. Analysis and Evaluation by the Competent Authorities - 3.4.1.

 

 
 Return to index

  previous page

  next page

3 How MAP works

3.4. Analysis and evaluation by the competent authorities

3.4.1. Position papers

To achieve timely resolution and to facilitate meaningful discussions, it is recommended that the competent authority consider the preparation and transmission of a position paper as a matter of priority.  Sufficient detail in a position paper will enable the other competent authority to understand the issue and determine the best course of action, in other words the best method to relieve double taxation or resolve the issue.  The type of information and level of detail suggested for the position paper are set out below.

The country that has taken an action that led to the taxation which is alleged to be contrary to a convention routinely provides a position paper (regardless of whether that is the competent authority to which the taxpayer has made its request). To facilitate consideration of a MAP case, a position paper provided on a timely basis and containing all the necessary information, as listed below, for the relieving competent authority would be helpful.   

a)

Legal name and address and taxpayer identification number of the person requesting assistance, its related persons in the other country, if applicable, and the basis for determining the association;

b)

The contact details of the competent authority official in charge of the case;

c)

Overview of the issue, transactions, business, and basis for adjustment;

d)

Applicable taxation years;

e)

Amount of income and tax adjusted for each taxable year, if applicable;

f)

Summary of relevant information from the original tax return;

g)

Description of the exact nature of the issue or adjustment and the relevant domestic laws and treaty articles;

h)

If relevant, calculation with supporting data (may include financial and economic data and reports relied upon and explanatory narratives as well as taxpayer documents and records where relevant and appropriate); 

 In transfer pricing cases, the following additional information would be helpful:

i)

Outline of comparable transactions and methods for adjusting differences;

j)

Description of the methodology employed for the adjustment; and

k)

An explanation of the appropriateness of the transfer pricing methodology employed for the adjustment (i.e. an explanation why it believes the adjustment achieves an arm's length outcome; identification of tested party, if applicable; industry and functional analysis, if a relevant study is not already included elsewhere in the taxpayer’s submission).  

In response to a position paper, the other competent authority naturally reviews the case and then provides its views.  In cases where there is disagreement or clarification is required, a rebuttal position or a request for more information may be warranted.  This exchange of positions and evaluation by the competent authorities is best undertaken as a matter of priority.  To enable the competent authorities to identify the areas of disagreement and to understand the position of the responding competent authority, a rebuttal or response paper could include the following:

a)

Indication of whether a view, proposed solution, or relief proposed in the initial position paper can be accepted;    

b)

Indication of the areas or issues where the competent authorities are in agreement or disagreement;

c)

Requests for additional information and explanations necessary to clarify particular issues;

d)

Presentation of other or additional information considered pertinent to the case, but not raised in the initial position paper; and

e)

Submission of proposals or views to resolve the issue.

If the competent authorities involved intend to hold a face-to face meeting, some of the issues listed above may then be addressed at the meeting.  In such a case, it would be beneficial if a response to an initial position paper includes item e) above. 

Return to index

 previous page

  next page

 

 

 

Countries list

  • Afghanistan
  • Albania
  • Algeria
  • Andorra
  • Angola
  • Anguilla
  • Antigua and Barbuda
  • Argentina
  • Armenia
  • Aruba
  • Australia
  • Austria
  • Azerbaijan
  • Bahamas
  • Bahrain
  • Bangladesh
  • Barbados
  • Belarus
  • Belgium
  • Belize
  • Benin
  • Bermuda
  • Bhutan
  • Bolivia
  • Bosnia and Herzegovina
  • Botswana
  • Brazil
  • Brunei Darussalam
  • Bulgaria
  • Burkina Faso
  • Burundi
  • Cambodia
  • Cameroon
  • Canada
  • Cape Verde
  • Cayman Islands
  • Central African Republic
  • Chad
  • Chile
  • China (People’s Republic of)
  • Chinese Taipei
  • Colombia
  • Comoros
  • Congo
  • Cook Islands
  • Costa Rica
  • Croatia
  • Cuba
  • Cyprus
  • Czech Republic
  • Côte d'Ivoire
  • Democratic People's Republic of Korea
  • Democratic Republic of the Congo
  • Denmark
  • Djibouti
  • Dominica
  • Dominican Republic
  • Ecuador
  • Egypt
  • El Salvador
  • Equatorial Guinea
  • Eritrea
  • Estonia
  • Ethiopia
  • European Union
  • Faeroe Islands
  • Fiji
  • Finland
  • Former Yugoslav Republic of Macedonia (FYROM)
  • France
  • French Guiana
  • Gabon
  • Gambia
  • Georgia
  • Germany
  • Ghana
  • Gibraltar
  • Greece
  • Greenland
  • Grenada
  • Guatemala
  • Guernsey
  • Guinea
  • Guinea-Bissau
  • Guyana
  • Haiti
  • Honduras
  • Hong Kong, China
  • Hungary
  • Iceland
  • India
  • Indonesia
  • Iraq
  • Ireland
  • Islamic Republic of Iran
  • Isle of Man
  • Israel
  • Italy
  • Jamaica
  • Japan
  • Jersey
  • Jordan
  • Kazakhstan
  • Kenya
  • Kiribati
  • Korea
  • Kuwait
  • Kyrgyzstan
  • Lao People's Democratic Republic
  • Latvia
  • Lebanon
  • Lesotho
  • Liberia
  • Libya
  • Liechtenstein
  • Lithuania
  • Luxembourg
  • Macao (China)
  • Madagascar
  • Malawi
  • Malaysia
  • Maldives
  • Mali
  • Malta
  • Marshall Islands
  • Mauritania
  • Mauritius
  • Mayotte
  • Mexico
  • Micronesia (Federated States of)
  • Moldova
  • Monaco
  • Mongolia
  • Montenegro
  • Montserrat
  • Morocco
  • Mozambique
  • Myanmar
  • Namibia
  • Nauru
  • Nepal
  • Netherlands
  • Netherlands Antilles
  • New Zealand
  • Nicaragua
  • Niger
  • Nigeria
  • Niue
  • Norway
  • Oman
  • Pakistan
  • Palau
  • Palestinian Administered Areas
  • Panama
  • Papua New Guinea
  • Paraguay
  • Peru
  • Philippines
  • Poland
  • Portugal
  • Puerto Rico
  • Qatar
  • Romania
  • Russian Federation
  • Rwanda
  • Saint Helena
  • Saint Kitts and Nevis
  • Saint Lucia
  • Saint Vincent and the Grenadines
  • Samoa
  • San Marino
  • Sao Tome and Principe
  • Saudi Arabia
  • Senegal
  • Serbia
  • Serbia and Montenegro (pre-June 2006)
  • Seychelles
  • Sierra Leone
  • Singapore
  • Slovak Republic
  • Slovenia
  • Solomon Islands
  • Somalia
  • South Africa
  • South Sudan
  • Spain
  • Sri Lanka
  • Sudan
  • Suriname
  • Swaziland
  • Sweden
  • Switzerland
  • Syrian Arab Republic
  • Tajikistan
  • Tanzania
  • Thailand
  • Timor-Leste
  • Togo
  • Tokelau
  • Tonga
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Turks and Caicos Islands
  • Tuvalu
  • Uganda
  • Ukraine
  • United Arab Emirates
  • United Kingdom
  • United States
  • United States Virgin Islands
  • Uruguay
  • Uzbekistan
  • Vanuatu
  • Venezuela
  • Vietnam
  • Virgin Islands (UK)
  • Wallis and Futuna Islands
  • Western Sahara
  • Yemen
  • Zambia
  • Zimbabwe
  • Topics list