FRANCE LAW AND PRACTICE Contributed by: Caroline Silberztein, Benoît Granel, Jean-Baptiste Tristram, Lionel Ochs and Laura Nguyên-Lapierre, Baker McKenzie
the provisions of the bilateral tax treaty or direc - tive (Article 111 c of the FTC). Such withholding tax may be avoided provided that the taxpayer agrees to repatriate the sums corresponding to the adjustment within 90 days of receiving the proposal of reassessment.
France is also implementing the EU Directives on Administrative Cooperation (DACs), including those related to the following: • the automatic exchange of rulings (DAC 3); • mandatory automatic exchange of infor - mation in the field of taxation in relation to reportable cross-border arrangements (DAC 6); and • digital platform operators’ information and declaration obligations (DAC 7). 6.2 Joint Audits Article L 45 of the FBTP provides that the FTA can agree with another EU member state to initi - ate joint tax audits, though this remains rare in France: the FTA participated in eight joint tax audits in 2023. 7. Advance Pricing Agreements (APAs) 7.1 Programmes Allowing for Rulings Regarding Transfer Pricing France has an advance pricing agreement (APA) programme. The APA can be unilateral (agree - ment between the French competent authorities (CAs) and the taxpayer), bilateral or multilateral (agreement between the French CA, the foreign CA(s) and the taxpayer). However, the FTA has expressed a strong preference for bilateral APAs over unilateral APAs. The legal basis for APAs is Article L 80 B 7° of the FBTP and the relevant tax treaty (see 7.4 Limits on Taxpayers/Transactions Eligible for an APA ). The APA request can cover any transactions between related enterprises under the meaning of Article 57 of the FTC or transactions between
6. Cross-Border Information Sharing 6.1 Sharing Taxpayer Information
France has one of the most developed tax treaty networks in the world, which allows exchange of information with over 160 jurisdictions. As such, France uses the exchange of information arti - cles contained therein to share/obtain taxpayer information. France has been particularly active on this front: the FTA made 4,810 CIT-related requests in 2023. When the FTA requests information concerning a taxpayer from foreign tax authorities before the statute of limitations has expired, subject to cer - tain conditions, the normal statute of limitations period may be extended until the end of the year following that during which the FTA received a response to its request and, in any event, at the latest until the end of the third year following the one for which the initial statute of limitations period expired (Article L 188 A of the FBTP). France is also party to multilateral treaties ena - bling easier exchange of information, such as the one regarding CbCR or the Multilateral Con - vention on Mutual Administrative Assistance in Tax Matters.
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