Are Advance Pricing Agreements the optimal controversy management tool in the post-BEPS era?

Research output: Contribution to conferencePresentationResearch


When the Organisation for Economic Cooperation and Development (OECD) published its Action Plan on Base Erosion and Profit Shifting in 2013, it acknowledged that the actions it planned to implement to counter profit shifting practices required the simultaneous introduction of complementary actions ensuring certainty and predictability for business. The OECD envisaged that certainty and predictability would be enhanced through Action 14 of this Plan, which focused on making dispute resolutions more effective. While the minimum standard adopted by the 2015 Final Report on Action 14 aimed to strengthen the effectiveness and efficiency of the Mutual Agreement Procedure (MAP), the OECD also recommended as a best practice that countries should implement bilateral Advance Pricing Agreement/Arrangement (APA) programmes. APAs concluded bilaterally between treaty partner countries were seen as providing an increased level of certainty in both jurisdictions, lessening the likelihood of double taxation. APAs would have the added advantage of possibly proactively preventing transfer pricing disputes. While the emphasis here was on resolving bilateral disputes, another OECD Action 14 best practice acknowledged that phenomena such as the adoption of regional and global business models and the accelerated integration of national economies and markets have underscored the need for effective mechanisms to resolve multi-jurisdictional tax disputes. Countries were therefore encouraged to develop appropriate guidance not only on multilateral MAPs, but also on multilateral APAs.
At the time, the number of APAs worldwide was predicted to increase, as taxpayers sought to mitigate the risks associated with international tax controversy, including audits, penalties and double taxation.
This paper will seek to explore whether this predicted increase, both in bilateral and multilateral agreements, has eventuated. It will also examine whether APAs have emerged as the optimal controversy management tool in the post-BEPS era.
Original languageEnglish
Publication statusPublished - 6 Sept 2019
EventSociety of Legal Scholars Annual Conference - University of Lancashire, Preston, United Kingdom
Duration: 3 Sept 20196 Sept 2019
Conference number: 110


ConferenceSociety of Legal Scholars Annual Conference
Abbreviated titleSLS
Country/TerritoryUnited Kingdom
Internet address


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