d. Can mutual agreement procedures be combined with different legal bases?
When choosing the type of procedure, the taxpayer must bear in mind:
Some types of mutual agreement procedure cannot be combined.
Tax Treaties and the Arbitration Convention are compatible with each other, but incompatible with the Directive, which takes precedence over both.
Example:A taxpayer may request the initiation of a mutual agreement procedure with Germany under the Arbitration Convention and under the Tax Treaty with Germany.However, they cannot request the initiation of that same procedure under the Directive and the Tax Treaty with Germany, as the Directive takes precedence over the Tax Treaty.
It is possible to opt for the Directive (provided that the requirements for doing so are satisfied), even if a mutual agreement procedure under the Arbitration Convention and/or the relevant Tax Treaty is under way.
To do so, it would be sufficient to submit a new request for initiation under the Directive to both competent authorities, except in the case of taxpayers included in Article 57 of the Regulation on Mutual Agreement Procedures, who would only have to submit it to one authority.
The mutual agreement procedure already under way would end as soon as the first competent authority received the new request for initiation under the Directive.
Example:The competent authorities of Spain and Germany are conducting a mutual agreement procedure under the Arbitration Convention and the Tax treaty in force between Spain and Germany relating fiscal year 2019.The taxpayer decides they would prefer the mutual agreement procedure to be conducted under the provisions of the Directive.For that to be the case, they would have to submit a new request for initiation under the Directive, to both the Spanish and German competent authority.
Even though the taxpayer submits both requests at the same time, the Spanish competent authority receives it on 20 December of a fiscal year and the German authority receives it on 8 January of the following fiscal year. The procedure that was being conducted under the Arbitration Convention and the Tax Treaty ends on 20 December, date on which the mutual agreement procedure under the Directive would be initiated.