Resolving Tax Treaty and Transfer Pricing Disputes through Mutual Agreement Procedure (MAP)

How to leverage the MAP process especially if you are dealing with multinational enterprises and international clients


Legal Writing and Oral Advocacy

Credit Unit







The Mutual Agreement Procedure (MAP) is a special procedure found in tax treaties, independent of domestic legal remedies, aimed at resolving problems of juridical double taxation and, in the context of transfer pricing issues, economic double taxation. Although all Philippine tax treaties contain a MAP provision, the procedure is hardly utilized by Philippine taxpayers in practice due, in part, to the lack of awareness of the MAP process and how it should function.

This course will discuss how the Mutual Agreement Procedure can be used to resolve tax treaty and transfer pricing disputes.

While it is apparent that taxpayers prefer to resolve tax treaty disputes through the domestic route, learning how to access the MAP is increasingly becoming an important skill for a tax practitioner given the fast-changing international and domestic tax landscape.

Owing to the massive reform of international tax rules in the last five years, an effective MAP process has now become a minimum international standard under the BEPS Project for resolving cross-border tax disputes, more than 135 countries including our ASEAN neighbors and major trading partners are participants in the BEPS project.

Although the Philippines has not adopted the standard yet, it will, sooner than later, be brought into this process. Recent efforts of the BIR towards increasing transfer pricing enforcement activities have also raised expectations that more resources will be dedicated for transfer pricing examinations as the government looks for ways to enhance revenue collections post-pandemic.

Taxpayers need to strengthen their legal arsenal not only to overcome but prevent the problems arising out of BIR examinations. In many parts of the world, an Advance Pricing Arrangement (APA), which is a component of MAP, has been the preferred tool of multinational enterprises (MNEs) for managing transfer pricing risks and eliminating transfer pricing adjustments that cause economic double taxation.

Notwithstanding the absence of formal procedures on MAP and APA in the country, taxpayers can explore the MAP remedy in certain situations. This course draws on the United Nations (UN) and the OECD guidance and international practices on accessing the MAP and building a case that will produce satisfactory results for taxpayers. As the topic on MAP is rarely discussed in legal seminars, this course will cover the fundamentals of MAP, its legal basis, function, and purpose. It will discuss the cases and situations where MAP can be invoked by a taxpayer, and when MAP can be a viable solution to resolve tax issues.

Finally, the course will provide useful guidance for tax practitioners in initiating a MAP, the practical aspects of preparing a MAP request, and understanding how the whole MAP process works.

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Founding Partner, Ortiz and Bandon Law Offices

Charadine is a founding partner of Ortiz and Bandon Law Offices, a boutique firm specializing in taxation law. She is also a Tax Professor at the University of the Philippines (UP) College of Law, an MCLE lecturer on International Tax at the UP Institute for the Administration of Justice, and a lecturer at the Asian Institute of Taxation. Charadine was a former tax treaty negotiator for the Philippines and was responsible for formulating the technical positions of the Philippines in treaty negotiations.