beps base erosion and profit shifting

Base Erosion and Profit Shifting Actions

Implementation in Italy

Stefano RossiCPANoda Studio Venezia

Maurizio Di SalvoTax lawyer, CPA, LLMNoda Studio Milano

Paris, 09.06.2016

for


ITALY - Countering Base Erosion and Profit Shifting

The Italian Government has been focusing on fighting tax evasion and avoidance in recent years.

Many of the measures suggested within the context of the BEPS Project have been implemented in Italy by Legislative Decree No. 147 of September 14th 2015, which contains provisions laying down measures for [the] growth and internationalization of enterprises”. However, the OECD indications on transfer pricing documentation were implemented by Law No. 208 of December 30th 2015 (Stability Law).

Italy already has stringent rules on interest deductibility, royalties, lease and other payments, anti-hybrid provisions, and anti-abuse rules concerning EU directives, each resembling OECD and/or EU recommendations. Nevertheless, the rules will be reviewed in light of the OECD’s final proposals.

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Action 5 – Countering Harmful Tax Practices More Effectively

Italy has introduced a patent box regime for entities deriving income from certain R&D activities.

Said regime is in line with the «nexus approach» described in Action 5 report and, therefore, aims to restrict the tax regime to situations where«substantial activities» are carried out in Italy.

As for software, the 2016 Italian Stability Law hasrestricted the eligibility to those protected by copyright, in line with Action 5.

Marketing-related IP assets (trademarks) will be incentivized upon conclusion of the «transitionperidod» (2015/2019).

The election applies, irrevocably, for 5 years and is renewable.

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Action 5 – The Italian PatentBox Regime

Italian policy objectives are essentially a response to the high-level mobility of IP, and of the relevant income subject to preferential treatment.

The government’s aims include the intention to:– promote the placement or maintenance in Italy of certain (legally protectable) intangibles, guaranteeing benefits based on the incurring of R&D expenditures;– prevent the allocation abroad of qualifying IP assets, making the Italian market more attractive to domestic and foreign investment; – follow the OECD recommendations on preventing aggressive tax practices.

Qualifying expenditures: qualifying expenditures must all relate to actual R&D activity.

Preferential treatment: the preferential tax regime applies:• in case of qualifying income from the direct

or indirect use of qualifying IP assets: 50% exemption (30% - 2015 / 40% - 2016);

• in case of capital gains from the disposal of qualifying IP assets: 100% exclusion (90% to be reinvested within the second tax year from the disposal).

Taxes covered: corporate income tax (27,5% of the taxable income) and regional business tax (3,9% of the valued added of the production factors).

Which income? Italian qualifying income is that derived from the following qualifying IP assets:– industrial patents;– intellectual property;– drawings and models (legally protectable);– legally protectable processes, formulas and information; and– trademarks.

Base Erosion and Profit Shifting ActionsParis, 09.06.2016 | p.4

Action 5 – The Italian PatentBox Regime

Computation of qualifying income: the share of income subject to preferential tax treatment is to be determined based on the «nexus ratio».

The numerator of the ratio consists of expenditures related to R&D activities, relevant for tax purposes, for the maintenance, growth and development of intangible assets.The denominator of the ratio consists of the costs referred to in the numerator, increased by:- Intercompany flow through costs;- Cost Contribution Arrangements;- Cost of acquisition of the intangible asset.

Up-lift: the amount computed when determining the numerator may be increased by an amount corresponding to the difference between the numerator and the denominator(up to 30% of the numerator).

Upon direct use of qualifying intangible assets, the determination of the relevant economic contribution must be identified on the basis of a special international ruling procedure.Such procedure is merely optional in the case of intercompany licensing and in the case of capital gains. The ruling procedure guarantees the determination, in advance and in a manner binding upon the Italian tax authorities, of the exact criteria for the identification of patent box benefits.


Action 5 – Patent Box in an international context

Regarding the type of costs that form the numerator and denominator of the ratio, while Italian law expressly provides that such costs must be relevant for Italian tax purposes, the OECD seems to follow a different approach.

In fact, the Action 5 Final Report states that the costs to be considered in the calculation of the ratio are those incurred during the reporting period, regardless of the tax regime and the accounting treatment thereof.

The Italian Paten Box regime seems generally in line with international rules:i. Compatibility with the non-discrimination

provision of double tax conventions (DTCs): PEs of foreign companies can benefit from the measures;

ii. Compatibility with EU fundamental freedoms: the regime applies to costs sustained in EU or EEA Member States;

iii. Compatibility with EU state aid rules: the deduction regime for R&D costs is available to all businesses;

iv. Harmful tax competition and fundamental freedoms: there seem to be no territorial restrictions in the patent box regime;

The implementing Decree, which clarifies how the proportion of income that benefits from the incentive is computed, makes the regime compliant with the modified «nexusapproach» endorsed by OECD.


Action 8 10 – Aligning Transfer Pricing Outcomes with Value Creation

Even though this Action has not yet beenimplemented, the Internationalization Decreepublished in September 2015 contains rulesregarding the determination of the taxable profitsof a permanent establishment (PE) in Italy, formally recognising the «functional separate entity approach».

Therefore, TP Guidelines apply to dealingsoccurred between resident PEs and the foreignparent company.

Free capital attributable to resident PE to be determined based on functions performed, risksassumed and assets held by the PE.


Action 13 – Transfer Pricing Documentation and CbC-R

CbC-Reporting was introduced by the 2016 Italian Stability Law.

Italy is one of the Countries that signed a MCAA CbC-R (Multilateral Competent Authority Agreement for the authomatic exchange of CbCReport).

Instructions regarding the timing and procedures for filing the CbC-R with the Italiantax authorities should have been provided withinthe end of March 2016 in an implementing Decreeby the Ministry of Economy and Finance.

Italian CbC-Reports to be filed starting from tax year 2016.


Action 13 – The legal framework

2010 OECD TPG indirectly enforced in the Italian framework by Circular Letter n. 58/2010.The documentation that complies with specific regulations – annually updated - may benefit of a penalty protection regime.

Before 2016 Stability Law Italy did not have any statutory requirement of filing transfer pricing documentation (Master File and Country File). TP File is recommended to avoid shifting the burden of proof regarding arm’s length pricing to the taxpayer (discretionary filing).

In compliance with OECD Guidelines the 2016 Stability Law enforced into the Italian legal system specific reporting obligations for multinational enterprises (MNEs).

Subjective requirements: CbC-Reporting obligation applies to the holding company(Ultimate Parent Entity) of the group residing in Italy subject to consolidated financial statements requirements and whose consolidated result in the previous tax year worth at least EUR 750 million.

The same obligation applies also to subsidiaries located in Italy (Surrogate Reporting Entity / Other Reporting Entity):• if the parent company is resident in a

country which did not introduce any CbC-R obligation; or

• does not have any agreement with Italy which is in force to allow exchange of information related to the CbC-R; or

• that has not complied with its obligation to exchange information relating to the CbC-R.

The amount of revenue and gross income, taxes paid and accrued, as well as other elements that indicate a genuine economic activity are all subject to reporting.


Action 13 – The legal framework

Further details covering the effective date, specific content, filing requirements and methods, and other procedural terms and conditions to be followed in relation to the CbC-Report should have been provided by an implementing Decree to be issued by the Ministry of Economic Affairs and Finance within the end of March 2016 (not yet issued).

Failure to provide the report or providing an incorrect or incomplete report will trigger penalties ranging from EUR 10.000 to EUR 50.000.

No reference was made in the 2016 Stability Law provisions to any potential modifications to the existing Italian transfer pricing documentation regime.

The Italian tax authorities guarantee the confidentiality of information subject to reporting in accordance with the confidentiality obligations set out in the Multilateral Convention on Mutual Administrative Assistance in Tax Matters.

This is in line with OECD provisions set forth on the matter, within the context of the BEPS Project.


Action 3 – Cfc rule Italian CFC rule reshaping

The Italian CFC legislation is provided by article 167 of the Italian Consolidate Income tax (“TUIR”) and the implementing legislation, i.e. MiniserialDecree 429 21st November 2001

The Final Report of Action 3 includes detailed recommendations for the design of CFC rules for countries to consider if they are interested inimplementing a new regime or modifying an existing regime

The Italian CFC rule has been reshaped after the release of the OECD draft on Action 3, and on the basis of the Article 8 of Legislative Decree 147/2015.

What’s new???


Action 3 – Cfc rule Italian CFC rule reshapingA) Definition of CFC (art. 167 PD 917/86)

The profits realized by a non-resident company (this term is used to describe the most common case, i.e. CFC rules applied to non-resident companies, but the CFC rules may also apply to other types of entities, including partnerships) are deemed to be the profits of an Italian resident person if:

1) the resident person controls, directly or indirectly, also through trustee companies or interposed third persons, the non-resident company; Art. 2359 cc: company is deemed to be controlled if:- another company holds, directly or indirectly, the

majority of the votes at the shareholders’ meeting;-another company holds, directly or indirectly, sufficient votes to exert a decisive influence in the shareholders’ meeting; or - the company is under the relevant influence of

another company due to a special contractual relationship.

2) the company is resident in a jurisdiction that is deemed to have a low-tax regime. The level of taxation is deemed to be substantially lower than in Italy if the tax rate in the foreign jurisdiction is lower than 50% of the corporate income tax rate applicable in Italy (i.e. lower than 13.75% and 12% from 2017).

The CFC regime also applies to profits of non-resident persons that are not resident in a low-tax jurisdiction if the profits were earned through a permanent establishment

situated in a low-tax jurisdiction.

From 1 July 2009, the scope of the CFC rules may also apply to companies located in the European Union, provided that both the following conditions are met: -the actual income tax paid in the foreign jurisdiction is lower than 50% of the Italian corporate income tax that would be applicable to the company if it were resident in Italy; - more than 50% of the proceeds of the controlled company derive from financial activities, services, even if intragroup.


Action 3 – Cfc rule Italian CFC rule reshapingB) Attribution of profits (transparency)

Under the Italian CFC rules, the income (profits) of the CFC must be allocated to the Italian resident shareholder in proportion to its equity interest, even if there is no distribution of dividends or other form of repatriation of profits.

The income is imputed to the shareholder on the last day of the CFC’s fiscal year.

The resident shareholder must treat the income allocated under the CFC rules as business income and compute it accordingly, with certain exceptions. The income is then taxed separately from the other income of the resident shareholder and is subject to a tax rate equal to the average tax rate applied on the shareholder’s aggregate income. However, this average rate may not be lower than the ordinary IRES rate.

Foreign Tax credit/CFC: taxes (e.g. corporate income tax) paid by the CFC in the foreign jurisdiction where it is resident may be credited

against the Italian corporate income tax.

If the CFC distributes dividends to the resident shareholder, these dividends are not included in the shareholder’s income and, therefore, are not taxed in Italy up to the amount that has already been taxed under the Italian CFC rules (previously taxed income, or PTI). Therefore, Italy does not tax the shareholder twice.

Foreign taxes (e.g. withholding tax) levied on the part of the profits that are PTI for the resident shareholder (and, thus, not included again in its taxable income) can also be credited against the taxes due in Italy on the CFC income up to the amount exceeding the foreign taxes already credited under the CFC regime.


Action 3 – Cfc rule Italian CFC rule reshapingC) Safe Harbour rules

The Italian resident shareholder may apply for a advanced tax ruling under article 11 of Law 212/2000, claiming the non-application of the CFC rules.To this end, the Italian resident taxpayer must give evidence that:

- the CFC predominantly carries out, as its main business purpose, an industrial or business activity within the local market, i.e. within the market of the country where the company is located. For banks, financial institutions and insurance companies, this evidence is deemed to be given if most of the funds, investments, and proceeds arise from the jurisdiction where these entities are located;

- the participation in the CFC does not achieve the result of shifting income to low-tax jurisdictions.

After the enactment of LD 147/2015, the Italian resident company may also prove the existence of the conditions required for the safe harbours during a tax audit process

Before issuing a notice of tax deficiency based on the CFC rules, the tax authorities must send a notice to the taxpayer whereby the taxpayer is given the opportunity to provide evidence of the application of one of the described safe harbours within 90 days.

Unless the CFC rules have already been applied or the taxpayer has obtained a positive tax ruling from the tax authorities, it must disclose in its IRES tax return the ownership of shares in non-resident companies that are potentially subject to the CFC rules. If the taxpayer fails to disclose its ownership, a penalty equal to 10% of the non-resident company’s income attributable to the taxpayer applies, with a minimum of EUR 1,000 and a maximum of EUR 50,000.


Action 6 – Italian GAAR – New ruling for proposed investmentexceeding Euro 30 milns

Three different areas identified by Action 6: (A) Treaty provisions and domestic rules to prevent granting of treaty benefits in inappropriate circumstances; (B) Clarification that tax treaties are not intended to be used to generate double non-taxation (C) Identification of tax policy considerations that countries should consider before deciding to enter into a tax treaty with another country.

Italian legislation has never had a true statutory GAAR until Legislative Decree 128/2015, which codified the case law doctrine of abuse of law (see below). The new GAAR is effective as of 1 October 2015

Art. 2 Legislative Decree 147/2015: a new ruling procedure for proposed investments in Italyhas been introduced, allowing taxpayers to inquire about the potential tax risks and implications for the proposed investments


Action 6 – Prevent tax abuseItalian GAAR

Before BEPS:

Although Italy did not have a true statutory GAAR before Legislative Decree 128/2015, the tax authorities have however relied on (i) an extensive range of specific anti-avoidance rules aimed at tackling specific transactions or practices,(ii) a sort of semi-general statutory GAAR(article 37-bis of Presidential decree 600/1973) (iii) the overarching abuse of law doctrine.

Abuse of law doctrine: the Supreme Court held that tax savings obtained via transactions or arrangements not supported by valid economic reasons are contrary to the constitutional principles of the ability to pay and of graduated taxation.

After BEPSLegislative Decree 128/2015 introduced a new statutory GAAR, added article 10-bis to L 212/2000, which provides for a new, single statutory definition of “abuse of law”, and which applies retrospectively to transactions that have not yet been challenged by tax authorities through the service of a formal notice of tax deficiency. Under the new definition, abuse of law exists when a transaction lacks any economic substance and, although formally consistent with tax law, is aimed at obtaining undue tax advantages.

Under article 10-bis of L 212/2000 (as enacted by DLgs 128/2015), the tax authorities must comply with strict procedural requirementsif they want to resort to the statutory GAAR.Advance tax ruling application is also provided for the taxpayers

Under article 10-bis L 212/2000, any abusive conduct does not constitute criminal behaviour and thus cannot result in a criminal offence.


Action 6 – Prevent tax abuseNew ruling for foreinginvestment

Art. 2 Legislative Decree 147/2015

Resident and non-resident taxpayers may apply for the ruling if they plan to make an investment in Italy, which is equivalent to at least € 30 million and with a significant and long-lasting impact on employment. The investment may also include the restructuring of a business in crisis as long as there are positive effects on employment

The advanced ruling is configured as a wide-ranging consulting activity by the Italian Tax Administration, made with references to various taxes. The law specifically mentions the possibility of asking for an explanation of the tax treatment for an investment plan and for any future extraordinary transactions.

It is possible to ask for information on the existence of an ongoing concern, of abuse of rights, of tax avoidance, of the requirements to disregard anti-avoidance rules and to gain access to particular regimes (e.g. tax consolidation).

The Italian Tax administration has to reply within 120 days with an extension of a further 90 days in case it is necessary to acquire additional information. If the reply is not received by the taxpayer within the specified period that means that the tax administration is in agreement with the interpretation of the behaviour proposed by the taxpayer

The response is binding for the Italian Revenue Agency as far as the facts and circumstances described by the investor do not change and comply with the Italian case law.

No tax assessment may be issued in contrast with the content of such response.


Action 7 – PE status – Changeson the regulation of PE’s

Action 7 includes a proposal for additional guidance on the determination of profits to be attributed to the PE’s as a result of the revised definition of PE will be provided. The OECD aims to release such guidance by the end of 2016

Italian Legislative Decree 147/2015 introduced several changes in respect of the tax regimeapplicable to permanent establishments (PEs), in:

- article 7 establishing new methods for computing income attributable to Italian PEs;

- article 14 providing an election for an exemption from the Italian tax base for income attributable to foreign PEs of resident enterprises


Action 7 – PE status – new methods for computing income attributable to Italian PEs

Rationale: the new provisions on the PE’s provided by art. 7 LD 147/2015 are intended to align Italy with the Authorised OECD Approach (AOA), as well as boost investment in Italy by non-resident MNEs.

As article 7(1) of the OECD Model (2014) makes clear, the PE state is only entitled to tax profits that the enterprise derives from that state through its PE. This means that, in principle, the right of the PE state to tax does not extend to profits that the non-resident enterprise may derive from that state, but that are not attributable to the activity carried out through the PE.But tax legistlation of many states adhered to the “force of attraction principle”.

Before art. 7 LD 147/2015Art, 23 (1) of Presidential Decree 917/1986 provides that business income derived through a PE situated in Italy are deemed to be originated in Italy, and are to be taxed in Italy.Article 151(2) of PD 917/1986, before the amendments were enacted, contained a provision that relied on a limited “force of attraction” doctrine. Specifically, article 151(2) of the same PD 917/1986 stipulated that, where a PE exists in Italy, certain items of income derived from activities carried out in Italy not through that PE should nevertheless be attributed to that PE.

After art. 7 LD 147/2015The amended article 152(1) of PD 917/1986 has abolished the remains of the force of attraction principle, making it clear that income attributable to an Italian PE only comprises gains and losses pertaining to it. Specifically, profits and losses of Italian PEs are calculated similarly to resident enterprises, i.e. by taking into account separately each item of income and by applying the PE test to each of them.


Action 7 – PE status – italian branch exemption regime

Rationale: to give resident enterprises an opportunity to take advantage of the potentially lower tax burden in the state in which the PE is situated. This measure may also serve as a deterrent to Italian MNEs considering transferring their tax residence to other states

Art. 14 of LD 147/2015 introduces an optional regime allowing resident enterprises to exempt the profits of their foreign PEs.It follows that the corresponding losses incurred by foreign PEs would also not be taken into account. This optional exemption constitutes an alternative to the ordinary foreign tax credit system with regard to the profits and losses of foreign PEs.

This represents a major shift toward a territorial system of taxation and a significant departure from the worldwide taxation regime generally applicable in Italy.

The branch exemption enables resident enterprises having PEs in a state with a lower tax burden to effectively benefit from the foreign state’s lower tax rate.

The new rules took effect on 1 January 2016.

Anti- avoidance ruleFirst, the election made by the resident enterprise is irrevocable. In addition, an all-in all-out approach has been adopted, meaning that the option must be exercised for all foreign PEs of a resident enterprise at the time the PE is constituted, or, for existing PEs of resident enterprises, the election is to be made by the second annual tax period subsequent to the introduction of the new regime.

The attribution of profits to foreign PEs follows the same rules for the attribution of profits to Italian PEs


Action 12 – Disclosure of aggressive tax planning – The new italian cooperative compliance regime

The Action 12 Report makes a series of recommendations about the design of mandatory disclosure regimes intended to allow maximum consistency between countries while also being sensitive to local needs and to compliance costs.The Action 12 Report considers the mandatory disclosure regimes implemented invarious countries (eg tax rulings, reporting obligations in tax returns and voluntary disclosure rules)

After a project pilot of 2013, Decree 128 of 5 August 2015 introduces into the Italian domestic tax system, the new cooperative compliance regime as of 1 January 2016 for large taxpayersLaw 186 of 15 December 2014 introduced a voluntary disclosure procedure for Italian residents to regularize their tax positions.


Action 12 – Aggressive tax planning – The new italian cooperative compliance regime

Rationale: the new tax compliance regime is aimed at promoting reinforced forms of dialogue and cooperation between the tax authorities and taxpayers who have put in place a mechanism of detection, measurement, management and control of “tax risk”.

- “tax risk” is defined as the risk of managing an undertaking in violation of tax rules or in contrast with

the aims and principles of the tax system

Initially, the regime will only be available to qualifying taxpayers with a turnover of at least EUR 10 billion. The Ministry of Economy and Finance will issue a decree that will set the criteria to identify additional eligible taxpayers, provided that they have a turnover (or gross revenues) of at least EUR 100 million.

A report must be submitted at last yearly to the board of directors. This report will confirm that the tax obbligation have been fulfilled, will identify that check and controls put in place and indicate the results of these controls and the initiative taken to resolve any problem that have emerged. Taxpayers may elect to participate in the regime by electronically filing a specific request with the tax authorities.

Participating taxpayers may achieve a joint evaluation of their potential tax risks with the tax authorities before the filing of the tax returns.

In relation to the tax risks timely disclosed to the tax authorities, participating taxpayers will enjoy:- a 50% reduction of the tax penalties if the tax authorities end up disagreeing with the position taken by the taxpayer;- the possibility of not providing any guarantee when they apply for the refund of taxes, whether direct or indirect.


Action 12 – Aggressive tax planning – Voluntary disclosure program for italian tax residents

Until 30 November 2015, Italian residents subject to individual income tax who, up to 30 September 2014, omitted to declare in their income tax return assets and investments held abroad may have commence a voluntary disclosure procedure, except if they are already subject to tax audit or inspection.

The voluntary disclosure procedure was also available to taxpayers who wanted to regularize their tax positions with respect to the tax years still open to assessment, including violations of WHT obligations on employment income and irrespective of the connection with undeclared assets and investments held abroad. The voluntary disclosure procedure was also available to PE of no residents.

Taxpayers must file a request with the tax authorities disclosing all assets and investments held abroad, and provide for the relevant documentation and infoon income necessary for their creation or acquisition and possible income. Under the new procedure, taxpayers must have to pay the entire amount interest and taxes due: penalties were generally equal to the minimum penalty, reduced by one quarter, and sometimes further reduced by up to 50% of the minimum penalty.

For undisclosed activities not excd EUR 2 million, taxpayers may also opt for a simplified assessment procedure (amount due by applying a flat rate of 27% on 5% of the value of the undisclosed activities at the end of the tax year).Participating taxpayers are not liable to criminal prosecution for fraudulent tax returns, the omission or inaccurate filing of tax returns, failure to pay VAT or certified WHT, money laundering and self-laundering.


Action 14 – Dispute resolution –International ruling regime

The final report on Action 14, Making Dispute Resolution Mechanisms More Effective, reflectsthe commitment of participating countries to implement substantial changes in their approach to dispute resolution.

Legislative decre156/2015 completely reformed the tax ruling system, providing - with effect from 1 January 2016 - for four types of tax rulings- the interpretative ruling; - the regime admission ruling;- the anti-abuse ruling;- the disapplication ruling.

In such a scenario, article 1 of LD 147/2015 added article 31-ter to DPR 600/1973, which provides for a new advance tax agreement (ATA) procedure.


Action 14 – Dispute resolution– New advance tax agreement(ATA)

Scopes:(i) transfer pricing (advance pricing

agreements); (ii) attribution of income or losses to Italian

permanent establishments of non-resident taxpayers and to foreign permanent establishments of Italian taxpayers;

(iii) application of domestic tax laws or tax treaties to dividends, interest and royalties or other items of income;

(iv) advance assessment of whether non-resident persons’ activities in Italy give rise to a permanent establishment;

(v) patent box regime issues;(vi) determination of the tax basis of assets in

the case of inbound and outbound migrations of companies.

Within 30 days of receipt of the ruling application, the tax authorities invite the taxpayer to discuss the documentationprovided, to request any supplemental documentation and to define the time schedule of the procedure.

The entire process must be completed within 180 days from the receipt of the application. The tax authorities will gather information from the documentation provided by the taxpayer, from the meetings and from the ordinary procedures to collect information at the taxpayer’s premises, as well as through the exchange of information with foreign tax authorities (when the 180-day term is suspended).

The procedure concludes with the signing of the ATA, that is valid for 5 fiscal years, providedthat the underlying factual and legal

circumstances remain unchanged.

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Action 14 – Dispute resolution– New advance tax agreement(ATA) procedure

Rollback effects:Article 31-ter of PD 600/1973: - in the case of ATAs based on arrangements

reached with the competent authorities of other countries under the MAP provided by the tax treaties, the ATA is also binding for previous fiscal years;

- in all other cases, taxpayers may decide to roll back the terms of the ATA to previous fiscal years, provided that there have been no changes in the underlying factual and legal circumstances that occurred.

The taxpayer has to file an amended tax return for the previous years or voluntarily pay any deficiency that results from applying the terms of the ATA to such previous years. The taxpayer is not subject to penalties.

After the ATA has been executed, the taxpayer must periodically (or upon specific request) submit documents and information to allow the tax authorities to monitor the taxpayer’s compliance with the terms of the ATA.

If following these checks or otherwise the tax authorities determine that the underlying factual or legal circumstances of the ATA have changed, they send a notice to the taxpayer to discuss the potential amendments to the ATA.The implementing regulation issued by the tax authorities also sets forth the procedure that should be followed in case it is the taxpayer that requests the amendment to the ATA. In particular, in such a case, the same procedure as provided for the original ATA basically applies, and the term to sign the amended ATA is 180 days.

Until the ATA is valid and binding, the tax authorities may exercise their audit or assessment powers only in relation to matters other than those in the ATA.


Thank you for your attention!


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beps base erosion and profit shifting

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