Advance pricing agreements (APAs) were introduced for the first time by legislation adopted on 11 January 2013 and effective as from 1 January 2014.
The APA application can be made in respect of matters related to the determination of intercompany prices, such as transfer pricing method, the comparable data, critical assumptions on the future conditions, etc. The duration of an APA cannot exceed 4 years, and may not apply to a fiscal year preceding the date of the APA application. Taxpayers are allowed to engage in the preliminary consultation with the tax authority prior to a formal APA application to discuss the taxpayer’s situation. The preliminary consultation, while highly recommended, is not mandatory. APA requests are to be made to the Directorate of Tax Audits.
In the case of a bilateral or multilateral APA, a corresponding application is required to be submitted to the foreign tax authorities and a copy of it to the Greek tax authorities within one month.
Effective 1 January 2015, the standard deadline for the issuance of a decision for an APA is 18 months (36 months if extended by a decision of the General Secretary of Public Revenue).
Once an APA is entered into, the taxpayer must file an annual compliance report. Failure to file the report can result into cancelation of the APA.
On 29 July 2020, Greece adopted APA roll-back rules in line with BEPS Action 14. The provisions allow taxpayers to request for a roll-back of the APA in cases where the relevant facts and circumstances in earlier fiscal years are the same. The roll-back is possible where the earlier fiscal years are not time-barred, and tax audit is not finalized with respect to the relevant fiscal years.
Taxpayers are also allowed to file amended tax returns based on an APA decision, without incurring late payment interest, or penalties, provided an amended return is filed within 30 days of the APA decision notification date. This applies in cases where an amended return was filed prior to the new law's enactment.
In response to the effects of COVID-19 pandemic on transfer pricing issues, Greece published guidelines to cover the impact of the pandemic on APAs and APAs under negotiation.
Most tax treaties concluded by Greece contain a MAP clause allowing the Competent Authorities of the Contracting States to consult with each other with the aim of resolving instances of (double) taxation not in accordance with the Convention. The Greek tax authorities (IPRA) have issued guidance ( MAP Handbook) on the practical modalities of access to, and functioning of MAP under Greece’s tax treaties.
Furthermore, Greece is a signatory to the EU Arbitration Convention, which sets out dispute resolution mechanisms, including binding arbitration, between the contracting parties with respect to transfer pricing adjustments. IPRA issued a decision (POL. 1129/2017 of 23 August 2017) on the application of MAP under the EU Arbitration Convention. Also, the EU Directive on Tax Dispute Resolution has been implemented and applies in Greece since 1 July 2019.
Greece has approved the law to transpose the EU Council Directive on dispute resolution for effective settlement of tax disputes (the DRDM Directive). The law includes rules to ensure the effective resolution of disputes between Greece and the other EU Member States concerning the interpretation and application of bilateral tax treaties and the Union Arbitration Convention, and in particular, disputes leading to double taxation. The rules cover disputes submitted from the publication of the law in relation to income or capital earned in tax years commencing on or after 1 January 2018. Disputes submitted before publication may also be covered if agreed to by the Member States concerned.