FRANCE Law and Practice Contributed by: Alexis Popov, Martin Serre and Stéphane Duchesne, &Co Advisory
conditions, including bond yields (Conseil d’État, 10 July 2019, Nos 429426 and 429428, Wheelabra- tor Group ). • Demonstrating that an interest rate is at arm’s length requires a detailed justification of any comparability adjustments made, particularly with respect to credit risk and the specific character - istics of the transaction (CAA Paris, 18 December 2025, No 24PA01640). 15. Foreign Payment Restrictions 15.1 Restrictions on Outbound Payments Relating to Uncontrolled Transactions France does not impose restrictions on outbound pay - ments in uncontrolled transactions. There are no for - eign exchange controls or similar limitations affecting such payments. 15.2 Restrictions on Outbound Payments Relating to Controlled Transactions No direct restrictions apply to outbound payments between related parties. However, several tax provi - sions may limit their deductibility from a tax perspec - tive. 15.3 Effects of Other Countries’ Legal Restrictions French transfer pricing regulations do not contain spe - cific provisions addressing the impact of foreign legal restrictions. 16. Transparency and Confidentiality 16.1 Publication of Information on APAs or Transfer Pricing Audit Outcomes Information related to APAs is released through offi - cial reports and communications from the French Tax Authorities. These sources provide data on the num - ber of APA applications filed each year, along with general information on their outcomes.
The latest statistics published by the OECD for 2024 indicate that France reported a significant APA case - load. At the beginning of the year, there were 159 cas - es in the opening inventory, with 49 new cases initi - ated during the year. In total, 32 cases were closed, of which 21 were granted and 11 were rejected; no cases were closed for other reasons. Consequently, the year-end inventory increased to 176 cases. The OECD statistics further show that the average time required to grant an APA in France during the reporting period was 35 months. This suggests that while the French APA process is available and actively used, it can, in practice, remain relatively lengthy. With respect to transfer pricing audit outcomes, offi - cial statistics are also published on a regular basis. In 2024, transfer pricing reassessments (on a tax base basis) amounted to EUR3,375 million, representing a 44% increase compared to 2023. In addition, transfer pricing-related reassessments accounted for 50% of the total reassessments made in the context of international taxation in 2024. The average reassessment amount per case reached EUR9 million, up from EUR6.7 million in 2023. 16.2 Use of “Secret Comparables” While not explicitly prohibited by statute, French courts require that taxpayers be placed in a position to review and challenge the comparables used by the tax authorities. As a result, comparables that are not sufficiently disclosed, or that cannot be meaningfully analysed, cannot be relied upon to support a transfer pricing adjustment. This principle has been consistently confirmed by case law, including decisions in which adjustments were rejected due to the use of non-transparent or non-verifiable comparables. In practice, the French Tax Authorities rely on publicly available data or comparables that can be disclosed with sufficient detail. The use of undisclosed compa - rables is therefore effectively excluded and may be challenged as a breach of the adversarial principle.
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