Monday, March 8, 2021

Esquel’s Guangdong subsidiary signs the province’s first expedited APA

Congratulations to our subsidiary Guangdong Esquel Textiles (GET) for reaching an Advance Pricing Agreement (APA) with Foshan Gaoming Local Taxation Bureau, effective for the next four fiscal years. The APA with GET marks the first successful case of an expedited process in Guangdong province, slashing the negotiation period from what can take several years to just six months.

Located in Gaoming district, Foshan, GET is our flagship manufacturing base and technology hub. The APA recognizes GET as a trusted company with a proven track record of transparency and compliance in our financial standing. GET benefits as an APA helps the business significantly reduce tax-related risks and efficiently resolve international tax controversies, so resources can be redirected into business growth. Tax authorities can also benefit as an APA helps stabilize operational costs, increase the fairness, transparency and predictability of tax policies, and improve tax services.

The signing of the agreement demonstrates innovation in handling procedures and management thinking. It is also a concrete manifestation of the state tax administration's support for enterprises, and Foshan’s latest measures to optimize the business environment while enhancing services for foreign enterprises. It will certainly help Esquel to make use of Foshan as a focal point for further business development in the Greater Bay Area.

Many countries are utilizing APAs; tax authorities negotiate with companies to agree upon a profit distribution model and standard contract for a fixed period of time based on the fair application of the arm’s length principle, for enterprises that handle cross-border taxation issues.

Esquel’s subsidiary in Guangdong signs APA with Foshan Local Taxation Bureau with an expedited process taking only six months instead of years.