FRANCE TRENDS AND DEVELOPMENTS Contributed by: Caroline Silberztein, Benoît Granel, Jean-Baptiste Tristram and Laura Nguyên-Lapierre, Baker McKenzie
MAP under the Directive on Tax Dispute Resolu - tion Mechanisms. Under the Arbitration Convention, 139 cases were completed in 2023, with an average time for completion of 42 months. Despite the two- year deadline for resolving cases before initiating arbitration, this average results from 121 cases still pending in 2023, two years after initiation, due to waivers of the time limit with the taxpay - er’s agreement. Under the Directive on Tax Dispute Resolution Mechanisms, 61 cases were awaiting a MAP decision at the end of 2023. Publication of draft guidance with respect to dispute resolution and prevention On 15 January 2025, the French tax authorities published a series of draft administrative guide - lines on MAP and APA for public consultation, allowing stakeholders to provide feedback shap - ing the final guidelines. The public consultation ended on 1 March 2025. It should be noted that taxpayers can rely on the draft guidelines until they are potentially revised following the consultation; they are therefore already enforceable against the French tax authorities. The aim of these administrative guidelines is to comment on the Directive on Tax Dispute Reso - lution Mechanisms as well as to update existing guidelines related to associated topics, such as the guidelines on transfer pricing, APA and MAP under bilateral tax treaties and the European Arbitration Convention. The draft administrative guidelines on the Direc - tive on Tax Dispute Resolution Mechanisms are generally in line with the French transposition
of this Directive. Apart from the strict transposi - tion of the Directive on Tax Dispute Resolution Mechanisms, the following points are of note: • the explicit or implicit acceptance of a tax adjustment by a taxpayer does not deprive him or her of the right to request a MAP, even in cases of spontaneous regularisation based on the procedure set forth by Article L62 of the French Book of Tax Procedure; and • taxpayers can assert their right to tax relief following a final decision through a standard claim procedure (pursuant to Article L190 of the French Book of Tax Procedures) and can refer the matter to the judge if no response is received within six months. Given the availability of up to three distinct legal mechanisms for opening a MAP – under the Arbitration Convention, the Directive on Tax Dis - pute Resolution Mechanisms and/or bilateral tax treaties – it is critical to evaluate carefully which instrument to employ based on the specific cir - cumstances of each case. This decision can sig - nificantly impact the effectiveness and efficiency of the dispute resolution process. This is espe - cially relevant when considering the Directive on Tax Dispute Resolution Mechanisms, as it is not compatible with other legal instruments. Moreover, while it is theoretically possible to pursue MAP concurrently with litigation, this approach necessitates careful consideration of timing and procedural requirements. International collaboration with respect to arbitration France is also part of the arbitration project at the EU level, with ten EU member states, includ - ing France, currently negotiating a convention to establish an International Tax Dispute Reso - lution Commission. Other EU member states
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