Mutual Agreement Procedure Peer Review: Understanding the Process
The Mutual Agreement Procedure (MAP) is an essential component of the international tax system. It is a dispute resolution mechanism that allows taxpayers to resolve international tax disputes between two countries. The MAP procedure is a bilateral negotiation process that relies on cooperation and mutual agreement between the countries involved.
The MAP process is activated when a taxpayer faces double taxation or taxation that is not in accordance with the provisions of the relevant tax treaty. The procedure involves mutual agreement negotiations between the tax authorities of the countries involved in the dispute. This process allows for the correction of tax disputes and the elimination of barriers to cross-border trade and investment.
The peer review process is an additional step in the MAP procedure that ensures the effectiveness of the dispute resolution mechanism. The OECD has developed a framework for conducting peer review assessments of the MAP process to improve its efficiency and effectiveness.
The peer review process is carried out by a team of experts from different countries. The team members assess the MAP process based on a set of criteria developed by the OECD. The criteria include the efficiency, effectiveness, and relevance of the MAP process.
The peer review team evaluates how well the MAP process is working in practice. They review the procedures followed, the outcomes achieved, and the level of cooperation between the countries involved. The peer review process also identifies areas for improvement and provides recommendations for enhancing the effectiveness of the MAP process.
The results of the peer review process are published in a report that is made available to the public. This report provides an assessment of the MAP process and identifies areas for improvement. The report also highlights best practices and shares experiences from different countries.
In conclusion, the Mutual Agreement Procedure Peer Review is an essential process in the international tax system. It ensures that the MAP process is working effectively and efficiently. The peer review process provides valuable insights on the effectiveness of the MAP process and identifies areas for improvement. Taxpayers and tax authorities should be familiar with the MAP process and the peer review process to ensure that they can effectively resolve international tax disputes.