Concrete guidelines for transfer pricing are laid down in policy statements, applying to amongst others the possibility to obtain Advance Tax Rulings, or more specific, if the ruling relates to transfer pricing issues, Advance Pricing Agreements (“APA”). The APA practice is effective as of 1 April 2001.   

An APA provides certainty in advance regarding the arm’s length pricing of cross-border transactions, including financing or licensing activities and the provision of services, between affiliated enterprises and between parts of the same legal enterprise (head office and permanent establishment). 

Taxpayers have considerable freedom in determining which (types) of transactions to include in the APA and whether the APA will include more than one tax jurisdiction. Consequently, tax payers are enabled to customize advance certainty to their specific needs. 

Special policies and procedures apply for qualifying group financing companies. See also Dutch transfer pricing rules for financial service companies.

An unilateral APA is an agreement (“Vaststellingsovereenkomst”) between a tax payer and the Dutch tax authorities. A bilateral or multilateral APA involves two or more States.

An APA has a term of validity that will be established in the agreement (usually four to five years).  After the agreed term has expired and on request of the taxpayer, it will be considered again whether a new APA can be concluded under the same conditions.

As a first step, an application for an APA must be filed with the competent tax inspector who will present the request to the APA/ATR team of the tax authorities in Rotterdam for binding advice. The tax authorities in Rotterdam have exclusive authority with regard to the issuance of APA’s

The Dutch tax authorities will evaluate the request and consider all facts and circumstances linked with the transactions or activities for which certainty in advance is requested.  Upon receipt of the application, when necessary the tax authorities may liaison with all relevant knowledge groups and other technical specialists.  This is in essence an internal procedure although in practise the taxpayer may in the course of the ruling process be communicating directly with these specialists.

The tax authorities aim to process the request within 8 weeks after filing, which period can however be extended if additional information is required

What we can do for you:

We are gladly prepared to assist you with transfer pricing issues, and the associated documentation and filing requirements.

If you wish to receive more information, please feel free to contact us via e-mail or call us at our office in Amsterdam +31 (0)20 5709440 or Rotterdam +31 (0)10 2010466.  

We will make time for you!

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