Mutual agreement procedure 

You can apply for a mutual agreement procedure (MAP) if you are subject to double taxation or if you believe that your income has been taxed not in accordance to a bilateral tax convention.

Double taxation may take two forms:

1. Juridical, i.e. you are taxed on the same income in two States 

2. Economic, i.e. when taxation of the income of a taxpayer in one State duplicates taxation of the income of a related party which in another State. This is particularly common for transfer pricing reassessments between companies belonging to the same group

You can however only apply for a MAP for taxes referred to in the “Taxes covered” article of the relevant convention. When only EU Member States are concerned, you can also apply on the ground of Council Directive (EU) 2017/1852 of 10 October 2017 on tax dispute resolution mechanisms in the European Union. For transfer pricing matter only, companies can also apply using the EU Convention (90/463/EEC) on the elimination of double taxation in connection with the adjustment of profits of associated enterprises.

Advance pricing arrangement 

You can request an advance pricing arrangement (APA) to get tax certainty about international transactions between a French entity and a foreign related entity (i.e. belonging to a same group).

These arrangements are intended to apply, in particular, when the implementation of the arm’s length principle raises major issues concerning reliability and accuracy, or when the specific conditions in which the transactions are carried out are unusually complex. 

The APA procedure is somehow heavy and time-consuming, and is essentially intended for multinationals.

As a result, before requesting an APA, you should check that the expected benefits are not outweighed by the resources you would have to mobilise. In any case, a prefiling meeting with the French competent authority for APA in order to discuss the request before its filing is mandatory.