PORTUGAL Law and Practice Contributed by: Tânia de Almeida Ferreira, João Pedro Albuquerque, Filipe Gomes da Silva and Pedro Neves, CCA Law Firm
8. Mutual Agreement Procedures and Arbitration 8.1 Availability and Legal Basis Portugal does not maintain a standalone domestic Mutual Agreement Procedure (MAP) regime independ - ent of its international obligations. The MAP framework is primarily based on Article 25 of Portugal’s DTTs, which generally follow the OECD Model. At EU level, Portugal has implemented Directive (EU) 2017/1852, providing for a structured MAP procedure and, where necessary, mandatory binding arbitration between member states. Portugal also applies the EU Arbitration Convention in cases involving transfer pricing and permanent estab - lishment disputes, and certain treaties, as modified by the MLI, may include mandatory arbitration provisions depending on Portugal’s reservations. 8.2 Application Deadlines The applicable deadline in Portugal is generally three years from the date of first notification of the action giving rise to the dispute, subject to confirmation under the relevant DTT or legal instrument. 8.3 Mandatory Binding Arbitration Mandatory binding arbitration is available in Portugal in cases falling within the scope of EU law and under certain DTTs (including those modified by the MLI), but it is not universally applicable under all DTTs nor provided as a standalone domestic mechanism.
9. Dispute Prevention 9.1 Advance Pricing Agreements
Portugal has an advance pricing agreement (APA) programme established under its domestic law. APAs allow taxpayers to agree in advance with the PTA on the transfer pricing methodology applicable to trans - actions with related parties. APAs may be unilateral, bilateral or multilateral. Where the relevant transactions involve associated legal enti - ties resident in jurisdictions with which Portugal has concluded a DTT, the taxpayer may request a bilateral or multilateral APA, involving the competent authori - ties of the relevant jurisdictions. The procedure is initiated through a formal request submitted to the PTA. Once concluded and accepted by the taxpayer, the APA is binding on the tax authori - Portuguese law provides for binding rulings as a mechanism to obtain advance tax certainty. Taxpay - ers may request a binding ruling from the PTA regard - ing the interpretation and application of tax law to a specific factual situation, including both domestic and international tax matters, such as cross-border trans - actions, PE issues and DTT interpretation. Binding rulings are issued upon request and are bind - ing on the PTA in relation to the requesting taxpayer, provided that the facts disclosed are complete and accurate and that the relevant legal and factual cir - cumstances remain unchanged. An expedited proce - dure is available, subject to the payment of a statutory fee. ties for the agreed period. 9.2 Other Mechanisms
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