The BEPS MLI will enter into force for these two countries on May 1, 2020.
Cyprus and Saudi Arabia have deposited with the OECD the Instrument of Ratification for the Multilateral Convention to implement tax treaty-related measures to prevent base erosion and profit shifting (BEPS MLI).
The BEPS MLI, negotiated by over 100 countries and jurisdictions, updates the existing network of tax treaties and reduces opportunities for MNE tax avoidance. The BEPS MLI seeks to modify existing bilateral tax treaties to swiftly implement measures relating to hybrid mismatch arrangements, treaty abuse, and permanent establishment.
The BEPS MLI also strengthens provisions to resolve treaty disputes, including through mandatory binding arbitration, which has been taken up by over 25 countries.
Cyprus and Saudi Arabia intend to cover 59 and 55 of their tax treaties, respectively, under the BEPS MLI. The BEPS MLI will enter into force for these two countries on May 1, 2020.
As on date, 41 countries have ratified the BEPS MLI.