Tax Dispute Resolution

In recent decades, due to the strain on international tax rules caused by the substantial increase in integration of national economies and markets, there has been a growth in the number of audit activities and tax assessments carried out by national tax administrations. National bodies and international organizations have, as a result, also begun to study and develop new rules and legal frameworks for providing taxpayers with dispute resolution mechanism more effective than those currently available. Notable among these developments is EU Council Directive 2017/1852, which introduced an efficient framework for the resolution of tax disputes and constituted a giant step toward ensuring legal certainty and a business-friendly environment for investments across Europe. This practical guide to the Directive, written by eminent tax partners and tax litigation specialists from key European jurisdictions, is the first in-depth book on this topic, explaining the law and application of the new Directive in each jurisdiction.

Following an introduction describing the Directive and analysing its most salient features, each individual country chapter written by a leading local expert, reports the relevant domestic implementing measures with commentary, relevant case law, and details of mutual agreement procedures (MAPs) and arbitrations. Each country chapter fully addresses key legal and practical issues such as:

• competent authority decision making concerning a taxpayer complaint filed under EU Council Directive 2017/1852;
• domestic provisions on MAP initiated under the Directive;
• taxpayer entitlement to request the formation of an Advisory Commission to start the arbitration phase;
• effective timelines;
• interplay of the procedures under the Directive with national legal remedies, including litigation before competent tax courts;
• recurring domestic issues relating to MAPs under treaties against double taxation and the EU Arbitration Convention; and
• opportunity for the taxpayer to involve national courts to unblock obstacles under the existing dispute resolution mechanisms.

This hugely valuable practice guide clearly explains how the Directive overcomes or greatly mitigates shortcomings in laws and initiatives such as the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI), the EU Arbitration Convention, the Common Consolidated Corporate Tax Base (CCCTB) proposal, and rules to ensure that digital business activities are taxed in a fair and growth-friendly way. It demonstrates the Directive's promise of restoring legal certainty, provision of enforceable deadlines for resolution of disputes, effective review or appeal procedures, and consistency of the application of rules throughout the EU Member States, as well as taxpayers' greater participation in the process. The full picture it provides of the options available to resolve a tax dispute under the new EU framework will be welcomed by tax practitioners and officials concerned with issues of transfer pricing and other aspects of cross-border taxation.

Raul-Angelo Papotti is a partner and the head of tax and tax planning department of Chiomenti. As a qualified barrister and a certified tax expert in Italy, he advises Italian and international clients on tax law and tax planning, cross-border taxation and transfer pricing, M&A transactions, trusts and estate planning matters. He advises multinationals in pre-litigation and litigation concerning cross-border tax and transfer pricing matters. His clients include leading global investment banks, Italian and foreign multinationals, and prominent HNWIs, families and family offices. He is the author of many publications on international tax matters and is a frequent speaker at domestic and international congresses. He is also the co-author of a book on the Italian Patent Box regime, edited by EGEA.