Germany

Germany has met all aspects of the terms of reference (OECD, 2021[3]) (ToR) for the calendar year 2021 (year in review), and no recommendations are made.

Germany can legally issue five types of rulings within the scope of the transparency framework.

In practice, Germany issued rulings within the scope of the transparency framework as follows:

Type of ruling	Number of rulings
Past rulings	30
Future rulings in the period 1 April 2016 – 31 December 2016	7
Future rulings in the calendar year 2017	10
Future rulings in the calendar year 2018	10
Future rulings in the calendar year 2019	8
Future rulings in the calendar year 2020	13
Future rulings in the year in review	10

No peer input was received in respect of the exchanges of information on rulings received from Germany.

Information gathering process (ToR I.A)

495. Germany can legally issue the following five types of rulings within the scope of the transparency framework: (i) preferential regimes;1 (ii) cross-border unilateral APAs and any other cross-border unilateral tax rulings (such as an advance tax ruling) covering transfer pricing or the application of transfer pricing principles; (iii) rulings providing for unilateral downward adjustments; (iv) permanent establishment rulings; and (v) related party conduit rulings.

496. For Germany, past rulings are any tax rulings within scope that are issued either: (i) on or after 1 January 2014 but before 1 April 2016; or (ii) on or after 1 January 2010 but before 1 January 2014, provided they were still in effect as at 1 January 2014. Future rulings are any tax rulings within scope that are issued on or after 1 April 2016.

497. In the prior years’ peer review reports, it was determined that Germany’s undertakings to identify past and future rulings and all potential exchange jurisdictions were sufficient to meet the minimum standard. In addition, it was determined that Germany’s review and supervision mechanism was sufficient to meet the minimum standard. Germany’s implementation remains unchanged, and therefore continues to meet the minimum standard.

498. Germany has met all of the ToR for the information gathering process and no recommendations are made.

Exchange of information (ToR II.B)

499. Germany has the necessary domestic legal basis to exchange information spontaneously. Germany notes that there are no legal or practical impediments that prevent the spontaneous exchange of information on rulings as contemplated in the Action 5 minimum standard.

500. Germany has international agreements permitting spontaneous exchange of information, including: (i) the Multilateral Convention on Mutual Administrative Assistance in Tax Matters: Amended by the 2010 Protocol (OECD/Council of Europe, 2011[1]) (“the Convention”), (ii) the Directive 2011/16/EU with all other European Union Member States and (iii) bilateral agreements in force with 61 jurisdictions.2

501. For the year in review, the timeliness of exchanges is as follows:

Future rulings within the scope of the transparency framework	Number of exchanges transmitted within three months of the information becoming available to the competent authority or immediately after legal impediments have been lifted	Delayed exchanges
		Number of exchanges transmitted later than three months of the information on rulings becoming available to the competent authority	Reasons for the delays	Any other comments
	8	2	See below	N/A

Follow-up requests received for exchange of the ruling	Number	Average time to provide response	Number of requests not answered
	1	ongoing	ongoing

502. In the prior year’s peer review report, Germany experienced two delays due to an addition of information and objections to the exchange by the domestic taxpayer, for which local tax authorities held hearings. Germany confirmed that this goes counter to their legal framework and therefore it was not expected to be recurring issue. During the year in review, Germany again experienced two delays. Germany explains that this was because the federal tax authority needed to request additional information from local tax authorities, and confirms it is not a recurring issue. Considering the small number of exchanges that were delayed, no recommendation is made at this stage, and this will be further monitored in next year’s peer review.

503. In the prior years’ peer review reports, it was determined that Germany’s process for the completion and exchange of templates were sufficient to meet the minimum standard. With respect to past rulings, no further action was required. Germany’s implementation in this regard remains unchanged and therefore continues to meet the minimum standard.

504. Germany has the necessary legal basis for spontaneous exchange of information, a process for completing the templates in a timely way and has completed all exchanges. Germany has met all of the ToR for the exchange of information process and no recommendations are made.

Statistics (ToR IV.D)

505. The statistics for the year in review are as follows:

Category of ruling	Number of exchanges	Jurisdictions exchanged with
Ruling related to a preferential regime	4	De minimis rule applies
Cross-border unilateral APAs and any other cross-border unilateral tax rulings (such as an advance tax ruling) covering transfer pricing or the application of transfer pricing principles	3	De minimis rule applies
Cross-border rulings providing for a unilateral downward adjustment to the taxpayer’s taxable profits that is not directly reflected in the taxpayer’s financial / commercial accounts	0	N/A
Permanent establishment rulings	3	De minimis rule applies
Related party conduit rulings	0	N/A
Total	10

Matters related to intellectual property regimes (ToR I.A.1.3)

506. Germany does not offer an intellectual property regime for which transparency requirements under the Action 5 Report (OECD, 2015[2]) were imposed.

Summary of recommendations on implementation of the transparency framework

Aspect of implementation of the transparency framework that should be improved	Recommendation for improvement
	No recommendations are made.

References

[3] OECD (2021), BEPS Action 5 on Harmful Tax Practices - Terms of Reference and Methodology for the Conduct of the Peer Reviews of the Action 5 Transparency Framework, OECD Publishing, Paris, http://www.oecd.org/tax/beps/beps-action-5-harmful-tax-practices-peer-review-transparency-framework.pdf.

[2] OECD (2015), Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance, Action 5 - 2015 Final Report, OECD/G20 Base Erosion and Profit Shifting Project, OECD Publishing, Paris, https://doi.org/10.1787/9789264241190-en.

[1] OECD/Council of Europe (2011), The Multilateral Convention on Mutual Administrative Assistance in Tax Matters: Amended by the 2010 Protocol, OECD Publishing, Paris, https://doi.org/10.1787/9789264115606-en.

Notes

← 1. Tonnage tax regime.

← 2. Participating jurisdictions to the Convention are available here: www.oecd.org/tax/exchange-of-tax-information/convention-on-mutual-administrative-assistance-in-tax-matters.htm. Germany also has bilateral agreements with Albania, Algeria, Armenia, Australia, Austria, Azerbaijan, Belarus, Belgium, Bulgaria, Canada, China (People’s Republic of), Costa Rica, Croatia, Cyprus, Denmark, Estonia, Finland, France, Georgia, Ghana, Hungary, Iceland, Ireland, Israel, Italy, Japan, Kazakhstan, Korea, Kyrgyzstan, Latvia, Liechtenstein, Lithuania, Luxembourg, Malaysia, Malta, Mauritius, Mexico, Netherlands, New Zealand, North Macedonia, Norway, Philippines, Poland, Portugal, Romania, Russia, Singapore, Slovenia, Spain, Sweden, Switzerland, Syrian Arab Republic, Tajikistan, Tunisia, Türkiye, Turkmenistan, United Arab Emirates, United Kingdom, United States, Uruguay, and Uzbekistan.