On 30 July 2020, the Swiss Ministry of Finance published a mutual agreement, signed by Switzerland on 28 July 2020 and by the United States on 23 July 2020, respectively, on mandatory binding arbitration under article 25(6) and (7) of the Switzerland - United States Income Tax Treaty (1996), as amended by the 2009 protocol and exchange of notes.
Cases eligible for arbitration
The cases eligible for arbitration are:
- cases in which no agreement under a mutual agreement can be reached, generally, within 2 years and all conditions for starting an arbitration procedure are satisfied; and
- unresolved bilateral Advance Pricing Agreement (APA) requests.
Cases not eligible for arbitration
The cases not eligible for arbitration are:
- cases not accepted by a competent authority or cases where no assistance is provided to a taxpayer because the procedural requirements are not met;
- cases which are deemed not to be suitable for arbitration by the competent authorities; and
- cases solved by a decision of a Court or Administrative Tribunal.
Interested parties have to decide within 30 days whether or not they agree with the outcome of the arbitration procedure.
For the full text of the Memorandum of Understanding, see here.