On November 22, 2021, the OECD released the latest mutual agreement procedure (MAP) statistics covering 118 jurisdictions and practically all MAP cases worldwide.
The data was released as part of the BEPS Action 14 minimum standard and the wider G20/OECD tax certainty agenda to improve the effectiveness and timeliness of tax-related dispute resolution mechanisms.
According to the 2020 MAP Statistics, around 2500 new cases started in 2020, with the top 25 jurisdictions accounting for 95% of them and the remaining cases involving around 40 other jurisdictions. The number of transfer pricing cases started has kept increasing (almost +15%), while the number of other cases has slightly decreased compared to 2019 (-2%).
Approximately 5% fewer MAP cases were closed in 2020 than in 2019, which is mainly owing to a decrease for other cases (-12%), while the number of transfer pricing cases closed has increased (+6%). Competent authorities were still able to close a significant number of cases in 2020, because they adapted to the changing landscape and replaced physical meetings with other forms of communication, including digital meetings, and prioritized simpler cases. Nevertheless, MAP inventories have increased in the majority of jurisdictions and this may require additional actions in the coming years.
Around 75% of the MAPs concluded in 2020 fully resolved the issue both for transfer pricing and other cases (compared to 85% for transfer pricing cases and 71% for other cases in 2019). Approximately 3% of MAP cases were closed with no agreement compared to 2% in 2019. In addition, the amount of cases withdrawn by taxpayers nearly doubled in 2020 (11% compared to 6% in 2019).
On average, MAP cases closed in 2020 took 35 months for transfer pricing cases (31 months in 2019) and approximately 18 months for other cases (22 months in 2019). Some jurisdictions experienced delays, especially for more complex cases, and the COVID-19 crisis affected the quality of their communication with some treaty partners. Also, while it is not possible to estimate the time that will be necessary to close pending cases, the data shows that approximately 15% of the 2020 end inventory relates to cases that have been pending for at least five years.