05 December 2016 Mandatory Binding Treaty Arbitration under OECD's Multilateral Instrument The Organisation for Economic Co-operation and Development (OECD) released the text of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (BEPS) under BEPS Action 15 (the multilateral instrument or MLI) on November 24. Approximately 100 countries formally adopted the text and the related explanatory statement at a ceremony hosted by the OECD following the conclusion of the negotiations during the week of November 21. The text of the multilateral instrument and the explanatory statement are available on the OECD Website. Part VI of the MLI enables countries to include mandatory binding treaty arbitration (MBTA) in their double tax treaties (DTTs) in accordance with the special procedures provided by the MLI. Unlike the other Articles of the MLI, Part VI applies only between countries that expressly choose to apply Part VI with respect to their DTTs. Currently, 20 countries have committed to adopt and implement MBTA in their bilateral tax treaties. A Tax Alert prepared by EY's Global Tax Desk Network, and attached below, provides additional details. Document ID: 2016-2057 |
