On 3 February 2021, the Administrative Court of the Dutch Council of State issued a decision on whether a taxpayer can request the initiation of MAP proceedings in regard to the refund of excess tax withheld by Dutch tax treaty partners. The case involved tax withheld on dividends in France and Germany (withheld at domestic rates), which a Dutch taxpayer held was in violation of the tax treaties between the Netherlands and the respective countries. In order to recover the excess tax withheld the taxpayer sought administrative assistance in the Netherlands through MAP, rather than through administrative procedures in France and Germany, which the taxpayer argued were time-consuming and costly. The taxpayer further argued that the implementation practice of Germany contrary to Article 63 of the TFEU given the costs incurred to obtain a refund. The MAP request was denied by the Dutch State Secretary for Finance, which held that MAP is not meant to address internal affairs of other countries and, in particular, that procedures for obtaining a refund of excess tax withheld are sovereign affairs and the costs incurred by a taxpayer to reclaim withheld tax is not a matter for MAP.

In its decision, the Administrative Court agreed with the State Secretary and held that the taxpayer could not appeal the rejection of the MAP request. The Court found that the refund procedures are part of the taxation process in the source State and ensure that taxation is in accordance with the tax treaty provisions and, as such, there is no taxation in violation of the tax treaty. Given that there is no taxation in violation of the treaty, the State Secretary rightly rejected the requests to initiate MAP on the basis of the bilateral tax treaties with Germany and France. Regarding the assertion that the implementation practice of Germany is contrary to Article 63 of the TFEU, the Court held that this also does not fall within the scope of MAP. If the taxpayer wishes to argue this point, proceedings must be initiated in Germany.