Procedure to deal with requests for bilateral or multilateral advance pricing agreements

Process.

• The process begins only if the associated enterprise outside India has initiated the process with the competent authority of the other country (sub-rule 2).
• India's competent authority consults the other country's authority on its willingness to negotiate and, if willing, negotiates and endeavours to reach mutually acceptable terms (sub-rules 3 and 4).
• On reaching an agreement, it formalises a mutual agreement procedure arrangement and intimates the applicant; if it fails, the applicant is told (sub-rules 5 and 6).
• The applicant cannot take part in the discussions between the competent authorities, but may communicate or meet India's competent authority (sub-rule 7).
• The applicant conveys acceptance or otherwise within one month from the end of the month in which the communication is received (sub-rule 8).
• If the applicant does not accept, it may continue the advance pricing agreement process without the benefit of the mutual agreement procedure, or withdraw the application under rule 107 (sub-rule 9).