Content area
Abstract
The tax reform of 1996 marked the start of French taxpayers' documentation obligations, and extended the French Tax Administration's power to conduct audits in the area of transfer pricing. Since September 1999, France has had a new mechanism, the advanced pricing agreement (APA) procedure. This procedure threatens - or gives the opportunity, if both parties are willing to seize it - to overturn traditional relations between French companies and the Tax Administration. Now that nearly all tax audits of multinationals in France deal either partially or totally with transfer prices, the French Tax Administration has embarked on the adventure of attempting cooperation with taxpayers via the APA procedure. The questions remains, however, of whether this procedure will establish itself as an invaluable tool for certainty and simplicity, heralding a radical transformation of the relationship between taxpayer and Tax Administration, or whether such cooperation will remain an insurmountable cultural contradiction.