[Opinion] Shaping Certainty in a New Tax Landscape | Reflections on the UAE’s APA Programme

Markus Susilo & Nimesh Malik – [2026] 183 taxmann.com 147 (Article)

The UAE’s introduction of an Advance Pricing Agreement (‘APA’) framework marks a significant milestone in the country’s corporate tax evolution. With the release of the Federal Tax Authority’s Corporate Tax Guide on Advance Pricing Agreements (CTGAPA1), taxpayers now have a structured mechanism to obtain prospective certainty on transfer pricing outcomes. Beginning with domestic unilateral APAs from December 2025 and cross‑border applications expected in 2026, the framework arrives at a pivotal moment, offering businesses a forward‑looking tool for risk management, planning, and governance.

Many businesses are encountering, for the first time, the formal expectation that related‑party transactions adhere to the arm’s‑length standard outlined in Article 34 of the Corporate Tax Law, while Article 59 provides statutory authority for APAs. The ability to agree in advance on transfer pricing methodology can be invaluable—reducing uncertainty, preventing disputes, and supporting multi‑year commercial strategies. In this context, the APA programme represents not only a procedural advancement but an important step toward cultivating a predictable and collaborative tax environment.

A topic that has naturally generated interest is the AED 100 million materiality threshold in the APA Guide. While the APA Guide sets this threshold for the value of controlled transactions proposed for coverage per tax period, it also clarifies that lower‑value transactions may still be considered where arrangements are complex or raise material transfer pricing uncertainty. This balance—clear criteria paired with administrative flexibility—reflects the diverse nature of UAE business models, where complexity does not always correlate with the size of the transaction.

One aspect that warrants careful reflection is the nature of the APA Guide itself. As a non‑binding administrative guide, it mirrors global practice for early‑stage APA regimes. This approach enables the tax authority to refine processes, incorporate feedback, and build internal capability before formalising elements through legislation. Over time, however, many jurisdictions choose to introduce more defined legislative backstops—such as codified access thresholds or procedural timelines—to enhance long‑term predictability for taxpayers.

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