|
||
Pepeliaev Group advises that the Russian Ministry of Finance has published its Guidelines on a mutual agreement procedure[1].
A mutual agreement procedure (‘MAP’) is understood to mean a procedure under a double tax treaty (‘DTT’) involving Russia and a foreign partner state to resolve disputes in the following cases:
An interested party should file with the Russian Ministry of Finance (the ‘Finance Ministry’) an application for a MAP in the form of a personal application in writing. The application should: contain the required information; be made in Russian, or in English together with a Russian translation); and attach sufficient information and documents.
The following persons are entitled to file an application for a MAP:
No fee is stipulated for filing an application for a MAP.
The time limits for filing an application for a MAP are established by a particular article of the DTT. In most DTTs, the time limit is 3 years after the applicant became aware of the actions which resulted in taxation that was not line with the DTT.
The following documents should be attached to the application for a MAP:
The Guidelines provide for additional types of documents in the following situations: (i) if the violation has already taken place; (ii) if the applicant (his foreign related company) has filed a claim to a higher tax authority or a court; (iii) if the application concerns transfer pricing; (iv) if the applicant has applied to the competent authority of the partner state under the DTT; and others.
The Guidelines state that an applicant may not be involved in a MAP because a MAP is conducted solely between competent authorities of partner states under the DTT. The applicant only facilitates the procedure and is advised of the results once the procedure is complete.
We recommend that you familiarise yourself with the Guidelines on a mutual agreement procedure as the onset of such procedures is an important signal of Russia’s interest in conducting such procedures under DTTs and enhancing their effectiveness. This, in turn, may provide further guarantees to foreign investors in terms of it being impossible for situations in which taxation runs counter to a DTT to occur in practice.
Pepeliaev Group offers a wide range of services involving comprehensive support for business on international taxation issues associated with the application of provisions of DTTs. We are ready to assist you with drafting an application and gathering the required documents to initiate a MAP.