The mutual agreement procedure (MAP) (also known as the competent authority procedure (CAP)) is an administrative procedure intended to help resolve difficulties arising from the following areas: the mutual agreement procedure (POP) remains the most widely used and best used means of eliminating double taxation. For more than two decades, the OECD and the EU have had an interest in improving the efficiency of the exploitation of LDCs through various instruments. After BEPS, the incidence of double taxation increases and the number of LDCs continues to increase. There is a growing emphasis on improving dispute settlement techniques in order to eliminate double taxation more effectively. This article presents some functions of the instruments currently available. The MLI was adopted on 24 November 2016. There are already about a hundred signatories and parties of the MLI, which entered into force on 1 July 2018. In order to promote the widest possible acceptance, the MFI contains flexible functions to allow countries to adapt their introduction to their circumstances and to take into account unique aspects of their contractual network. In order for the MMI to amend a bilateral tax treaty, both parties must (i) have signed and ratified the MFI and (ii) identify the treaties that will be covered by the MDI. While some of the MLI items are mandatory, most are optional. For example, legal systems may choose to support only minimum standards, or they may also choose to adopt some or all of the optional articles. Overall, it is clear that the MLI expands taxpayers` access, extending to three years the time available to taxpayers to initiate a POPs and imposing an effective two-year period on the competent authorities to settle a case (at the end of which it can be arbitrated). The MLI has led to greater uniformity of approach on certain key issues such as arbitration and, most importantly, to a single POP article for covered tax treaties.

The mutual agreement procedure is a proven way for tax administrations to resolve disputes relating to the application of double taxation treaties. This procedure, described and approved in Article 25 of the OECD Model Convention, can be used to eliminate double taxation that could result from a transfer pricing adjustment. . . .