Barbados, Côte d’Ivoire, Jamaica, Malaysia, Panama, and Tunisia have newly signed the base erosion and profit shifting (BEPS) Multilateral Convention, the OECD announced on January 24, 2018.
The Convention, developed through inclusive negotiations involving over 100 countries and jurisdictions, will modify existing bilateral tax treaties to swiftly implement the tax treaty-related BEPS measures. These include: measures on hybrid mismatch arrangements, treaty abuse, permanent establishment, and dispute resolution, including an optional provision on mandatory binding arbitration, which has been taken up by 28 jurisdictions.
As on date, a total of 78 countries and jurisdictions have signed the Convention. Algeria, Kazakhstan, Oman, and Swaziland have expressed their intent to sign the Convention and a number of other jurisdictions are actively working towards signature by June 2018, the OECD said.
So far, four jurisdictions – Austria, the Isle of Man, Jersey, and Poland – have ratified the Convention, which will enter into force three months after a fifth jurisdiction deposits its instrument of ratification.
The text of the Convention, the explanatory statement, background information, database, and position of each signatory are available on the OECD’s website.
OECD Secretary-General Angel Gurría said: “Today’s signing of the Convention is another major step towards updating the international tax rules through the swift implementation of the BEPS package. Beyond saving signatories from the burden of re-negotiating thousands of tax treaties bilaterally, the Convention results in more certainty and predictability for businesses, and a better functioning international tax system for the benefit of our citizens.”