On 16 September 2024 the OECD published the simplified peer review report on Nigeria under Action 14 of the project on base erosion and profit shifting (BEPS). The report sets out the results of Stage 1 of the simplified peer review of the implementation of the Action 14 minimum standard. The report concludes that Nigeria generally meets almost all the elements of the Action 14 minimum standard.

Under Action 14 of the OECD project on base erosion and profit shifting (BEPS), members of the OECD Inclusive Framework have committed to implementing the minimum standard on strengthening the effectiveness of dispute resolution procedures. Dispute resolution takes place through the mutual agreement procedure (MAP) based on Article 25 of the OECD Model, under which countries endeavour to resolve disputes related to the application of tax treaties.

Following the conclusion of the initial two-stage peer review process in 2022, a continued monitoring process has begun for all Inclusive Framework member countries. Countries that already have meaningful MAP experience are to be subject to a full peer review process once every four years; and countries that do not yet have significant MAP experience are to undergo a two-stage simplified peer review process.

The peer review report notes that Nigeria has a modest tax treaty network with 18 tax treaties and an established MAP programme, however its experience with resolving MAP cases is limited. The bilateral tax treaties are partially consistent with the requirements of BEPS action 14. The report notes that, to be fully in line with all the important areas of an effective dispute resolution mechanism under the minimum standard, Nigeria needs to amend and update ten of its tax treaties. Nigeria has signed the multilateral instrument (MLI) to include BEPS-related provisions into bilateral tax treaties, and eight of the treaties can be updated using this instrument. The remaining treaties can be amended through bilateral negotiation. A plan is in place to negotiate the updates.

The peer review report notes that Nigeria does not have a bilateral APA programme in place. Nigeria provides access to the MAP in all eligible cases. Nigeria has also established a documented bilateral consultation or notification process for situations where the competent authority considers that the objection raised by the taxpayers in a MAP request is not justified, although no such situations have arisen since 1 January 2016. Nigeria also has clear and comprehensive guidance on the availability of the MAP and how it applies this procedure in practice.

In the period from 2016 to 2022, MAP cases were on average closed in 19.89 months, which is within the targeted average timeframe of 24 months. The staff of the competent authority coordinate with the other competent authorities to exchange position papers on time. The peer review report therefore considers that Nigeria’s competent authority is adequately resourced.