Ukraine’s Cabinet of Ministers published Resolution No. 504 on 25 July 2015 regarding conclusion of advance pricing agreements (“APA”) in respect of controlled transactions for transfer pricing purposes. The new Resolution replaces the former Resolution No. 764 of October 17, 2013, and closes an existing loophole in the legislation regarding the procedure for concluding unilateral APAs.
Under the new APA order, large taxpayers to negotiate and conclude unilateral, bilateral and multilateral APAs with the tax authorities in regards to transfer prices in controlled transactions. APA process will be divided into early engagement (optional), APA application, Monitoring compliance. The legislation sets a maximum time limit of 60 calendar days for early engagement, but does not establish a timeframe for completion of the APA after a formal application is submitted.
The APA shall take effect from January 1 of the calendar year following the year in which it was concluded. No rollback provisions are envisaged. The term of the APA cannot exceed three years.
