China releases 16th annual APA report (2024), highlighting strong growth, efficiency

China’s State Taxation Administration released its 16th annual advance pricing agreement (APA) report on 25 November 2025, highlighting rising demand for APAs, strong signing efficiency, and an expanding focus on bilateral APAs as multinational groups seek greater transfer pricing certainty.

China’s State Taxation Administration (STA) published its 16th Annual Advance Pricing Agreement (APA) Report on 25 November 2025, providing a comprehensive overview of the country’s APA programme and its development between 2005 and 2024.

The report highlights steady growth in APA usage, increasing reliance on bilateral agreements, and high administrative efficiency, reflecting the growing importance of transfer pricing certainty for multinational enterprises operating in China.

Rising APA activity and growing demand for certainty

The number of APAs concluded by Chinese tax authorities continued to rise in 2024. A total of 39 APAs were signed during the year, comprising 12 unilateral and 27 bilateral agreements. This represents an increase from 36 APAs in 2023, confirming a sustained upward trend.

Demand for bilateral APAs has grown particularly strongly.

Of the 27 bilateral APAs signed in 2024, 22 were new agreements and five were renewals. At the intention stage, 70 bilateral APA cases were recorded in 2024—10 more than in 2023—indicating that cross-border groups are increasingly seeking protection against double taxation amid global tax uncertainty.

High closure rates and efficient negotiations

China continues to demonstrate strong efficiency in concluding APA cases. All 12 unilateral APAs signed in 2024 were completed within 24 months, while 13 of the 27 bilateral APAs were also finalised within this timeframe.

According to OECD statistics released in 2024, China’s APA closure rate was 24.2%, significantly above the global average of 18.1%, ranking seventh among surveyed jurisdictions. This performance underscores the maturity and effectiveness of China’s APA framework.

Expanding geographic reach of bilateral APAs

Between 2005 and 2024, Chinese tax authorities signed 170 bilateral APAs with tax authorities worldwide. Approximately 70% (118 agreements) were concluded with Asian countries and regions, while 33 agreements (around 20%) involved European jurisdictions. 18 APAs were signed with North American countries, and one with an Oceanian jurisdiction.

In 2024 alone, 27 bilateral APAs were signed, of which 19 bilateral APAs were signed with Asian partners, six with European countries, and two with North American jurisdictions, reflecting China’s continued focus on strengthening regional and global tax cooperation.

Industry trends and transaction types

Manufacturing remains the dominant industry in China’s APA programme, accounting for the majority of agreements signed in 2024. However, the STA notes a gradual diversification, with increased APA negotiations in sectors such as wholesale and retail.

The STA is increasingly looking at:

• Wholesale and Retail: Significant growth in negotiations here.
• Intangibles and Services: In 2024, while tangible assets dominated (22 cases), intangible assets were involved in 12 cases and services in 8 cases. This reflects the Chinese government’s focus on high-value-added activities and intellectual property

Transfer pricing methods: TNMM still dominates

When it comes to calculating transfer prices, the transactional net margin method (TNMM) remains the STA’s tool of choice.

Distribution of transfer pricing methods (Cumulative to 2024)

Among the 39 APAs signed in 2024, TNMM was used 29 times, CUP twice, and the Resale Price Method (RPM) once, reflecting a more tailored approach to complex transactions involving intangibles, market premiums, and cost efficiencies.

Earlier, STA published its 15th annual report on the advance pricing agreement programme on 26 December 2024.