Decree Delegated No. 116, dated 10 August 2026, implements the legal framework for Advance Pricing Agreements (APAs) between San Marino and Italy, following the bilateral agreement signed in July 2026. The decree establishes procedures for San Marino multinational enterprises to obtain binding rulings on transfer pricing methodologies for cross-border transactions with Italian associated enterprises. This move aims to prevent base erosion and profit shifting (BEPS) and provide certainty for taxpayers operating between the two jurisdictions. The APA process involves a pre-filing consultation, formal application to the San Marino Tax Office (Ufficio Tributario), and bilateral negotiation with the Italian Revenue Agency (Agenzia delle Entrate). Agreements can cover up to five fiscal years with possible renewal.
Key Takeaways
- Bilateral Certainty: Approved APAs eliminate transfer pricing audit risk in both jurisdictions for covered transactions, provided the taxpayer complies with the agreed methodology and annual reporting requirements.
- Eligibility and Scope: APAs are available for transactions involving tangible goods, intangibles, services, and financial arrangements. Taxpayers must demonstrate significant cross-border volume and complexity to justify the administrative burden.
- Documentation and Fees: Applicants must submit a comprehensive transfer pricing study, functional analysis, and economic benchmarking. A processing fee of €5,000 applies, with additional costs for bilateral negotiation phases.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement