On 25 February 2015, the Ministry of Finance of Albania published an instruction on Advance Pricing Agreements (APA). In this instruction the various types of APA’s are defined, and the application process and conditions are comprehensively substantiated.
Types of APAs
The following types of APA's are included in the instruction:
- Unilateral APA’s whereby an agreement is entered into between a taxpayer and the Albanian General Tax Directorate (GTD) on specified controlled taxations
- Bilateral APA's whereby a taxpayer requests that the GTD reaches an agreement with a treaty partner concerning the application of the 'associated enterprises' article of the relevant tax treaty to specified controlled transactions
- Multilateral APA's whereby a taxpayer requests that the GTD reaches an agreement with two or more treaty partners concerning the application of the 'associated enterprises' articles of the relevant tax treaties to the specified controlled transactions.
Requests on advanced pricing will only be considered if the controlled transactions envisage to be covered by the agreement, exceed the value of 30 million euros during the period covered by the APA (generally 3-5 years). Applications for uncontrolled transactions that do not meet the threshold may be accepted by the GDT, provided that the case is sufficiently complex and is of high commercial or economic significance to Albania.
Application for an APA is accompanied by a non-refundable payment in the amount of ALL 50,000. In addition the taxpayer has to pay an administrative fee of:
a. ALL 300,000 in the case of an unilateral APA
b. ALL 1,200,000 in the case of a bilateral APA
c. ALL 1,200,000 in the case of a multilateral APA
Maximum Covered Period
The maximum covered period for APA's is five years.