The appendix begins with the definition of the different types of APA and describes the objectives of the APA process. The ability to participate in an APA MAP is considered with respect to contractual issues and other factors such as the audit status of the subject. Issues relating to multilateral GPAs (i.e., where there is more than one bilateral agreement) are also addressed. The central point of the annex deals in detail with the whole MAP-APA procedure, starting with the meetings before the presentation, on the presentation of a proposal, its evaluation by the tax authorities, the discussion and conclusion of the mutual agreement, the implementation of this mutual agreement and, finally, the follow-up of the agreement and a possible extension. While the Schedule focuses on the direction of tax authorities, it takes the opportunity to discuss how the taxpayer can best contribute to this process. Under German law, a pre-price agreement (APA) is a combination of a prior agreement between the federal states on the transfer price between internationally linked companies and an expanded obligation based on it. At the end of the APA, the participating countries determine the method of transfer pricing to be applied for a fixed period in the future between the related companies or certain parts of the companies concerned. This is an administrative procedure based on requirements. Companies that wish to avoid the threat of double economic taxation in advance can apply for an APA. In Germany, the Bundeszentralamt for Steuern (BZSt) is responsible for the implementation of these procedures. Applications to open an APA can therefore be filed directly with the BZSt.
BZSt`s jurisdiction over mutual agreement, arbitration and APA procedures Once the application is received, the BZSt verifies that all conditions (including the applicant`s authorization not to contest the charges) for the execution of an APP procedure are met. An APP procedure is only implemented if the application is admissible and justified. AAAs – in the aforementioned sense – find their legal basis in the Double Taxation Conventions (DBA), in the respective articles on mutual agreement procedures. Germany has concluded DBA with more than 90 countries in the world. Most of these DBAs follow the OECD`s draft international agreement. The provisions on mutual agreement procedures are set out in Article 25, paragraphs 1 to 3, of the OECD Model Convention. Bilateral and multilateral APAs are generally bilateral or multilateral, i.e. they also enter into agreements between the subject and one or more foreign tax administrations under the control of the Mutual Agreement Procedure (POP) under the tax treaties.  The subject benefits from such agreements, since he is assured that income from covered transactions is not subject to double taxation on the part of the IRS and the relevant foreign tax authorities.