Irish Competent Authority Continues Its Winning Streak
On 14 November 2023, the OECD published the Mutual Agreement Procedure ("MAP") statistics for 2022. The OECD also announced the winners of MAP awards, which recognise the particular efforts made by Competent Authorities in 2022.
The importance of MAP as a key tax dispute resolution tool is clear from the OECD data and taxpayers are invoking more MAPs than ever. This is demonstrated by the number of new MAP cases opened in 2022, an increase of almost 3% compared to 2021. The increased caseload illustrates that there is greater access to MAPs and enhanced Competent Authority resources.
Over the last few years, the Irish Competent Authority has been recognised with a number of awards. The efficiency of the Irish Competent Authority team to deal with MAP cases is once again reflected in the 2022 MAP statistics and awards.
Ireland - Awards and Recognition
For the second year in a row, Ireland (together with both Denmark and Germany) has won the "co-operation" category for having the most MAP cases fully resolved through agreement by a pair of jurisdictions in both the transfer pricing and non-transfer pricing categories. Ireland and Denmark were the joint winners of the transfer pricing category and Ireland and Germany were the joint winners of the non-transfer pricing category.
Ireland was acknowledged for having the second shortest average time to close non-transfer pricing MAP cases. New Zealand was the winner with a time of approximately 6 months, with Ireland following closely behind with a time of 7.6 months.
Ireland was also acknowledged in the "caseload management" category for having the highest closing ratio after Luxembourg and Denmark.
Further details on the 2022 MAP awards are available here.
Insights on Ireland's MAP Cases
The OECD's statistical breakdown on Ireland (available here) revealed some interesting insights:
- Ireland closed 103 cases in 2022, giving rise to a significant decrease in the number of open MAP cases in Ireland. At the end of 2022, Ireland had a total of 144 open MAP cases, 77 (53%) of which were transfer pricing cases;
- Ireland continues to resolve the majority of its MAP cases by agreement to fully eliminate double taxation. In 2022, the percentage of cases resolved by agreement rose to 92% for transfer pricing cases and 89% for non-transfer pricing cases;
- No cases were denied access to MAP in Ireland in 2022;
- Not surprisingly, given the complexity, transfer pricing cases still take longer to resolve than non-transfer pricing cases, with the average closing time now at 24.6 months. In this regard, Ireland has moved to align with the BEPS Action 14 minimum standard to seek to resolve all MAP cases within an average timeframe of 24 months.
Making Dispute Resolution Mechanisms More Effective – Consolidated Information on Mutual Agreement Procedures 2023
As part of the OECD's 'Tax Certainty Day' on 14 November 2023, the OECD also released a publication on Consolidated Information on Mutual Agreement Procedures (available here). The publication provides stakeholders with an overview of information on MAPs in each member jurisdiction of the OECD/G20 Inclusive Framework in a clear and simple manner. The data summarises the most recent developments relating to MAP in Ireland and other member jurisdictions and will be updated annually alongside future MAP statistics released.
It is evident from the 2022 MAP statistics and awards that Ireland remains a highly effective MAP dispute resolution jurisdiction. The effectiveness of the Irish Competent Authority team and their increasing efficiency in resolving disputes by MAP has contributed to Ireland's successful recognition by the OECD.
Matheson's transfer pricing team has vast experience with MAPs and regularly works with tax and legal advisors across a large number of different jurisdictions coordinating MAPs and international tax disputes. If you have any questions, please contact Mark O'Sullivan, Anna Crowley or your usual Matheson Tax contact.