Base Erosion and Profit Shifting (BEPS) Implementation Sophie Chatel, Head of the Tax Treaties Unit, Centre for Tax Policy and Administration, OECD Maikel Evers, Tax Treaties Advisor, Centre for Tax Policy and Administration, OECD Achim Pross, Head of International Cooperation and Tax Administration Division, Centre for Tax Policy and Administration, OECD The Base Erosion and Profit Shifting (BEPS) project also includes key actions, notably exchange of information as well as the elimination of harmful tax practices and mutual agreement procedures to ensure that tax treaties are applied in accordance with their intents and purposes. The Inclusive Framework on BEPS, which now counts more than 100 member jurisdictions, conducts peer reviews of the implementation of BEPS action items on exchange of tax rulings, country-by-country reporting, harmful preferential tax regimes and the efficiency of mutual agreement procedures. Also, an important tool for BEPS implementation is the BEPS Multilateral Instrument (MLI), which allows signatories to quickly update its treaties to conform with BEPS tax treaty related measures. This session will provide an overview of the BEPS implementation phase and its results so far including a focus on the importance and impact of the MLI which has been signed by close to 70 jurisdictions and which is currently under ratification in many of them.

1. The swiftest way to fix the global
worldwide tax treaty network
Sophie Chatel & Maikel Evers
Centre for Tax Policy and Administration
multilateralinstrument@oecd.org
Treaty-Related BEPS
Measures and the MLI

2. Tax Treaty Related BEPS Actions
2
Action 14:
Making Dispute
Resolution More
Effective
Action 7:
Preventing the
Artificial Avoidance
of Permanent
Establishment Status
Action 6:
Preventing the
Granting of Treaty
Benefits in
Inappropriate
Circumstances,
Action 15:
Developing a
Multilateral
Instrument

3. Parent
Subsidiaries
Intermediary
Royalties
Licensing
Agreement
High Tax Jurisdictions
Low Tax Jurisdiction
No Tax Jurisdiction
Withholdingtax25%
Withholdingtax0%
3
Example of Treaty Shopping (Action 6)
IP
Treaty
Dividends
0%

4. Multilateral negotiations
Substance of tax
treaty-related BEPS
measures agreed in
the BEPS Package
Focus: How to modify
tax treaties to
implement the agreed
BEPS measures
Development of
provisions on
mandatory binding
MAP arbitration
MULTILATERAL
CONVENTION TO
IMPLEMENT TAX TREATY
RELATED MEASURES TO
PREVENT BASE EROSION
AND PROFIT SHIFTING
4

5. Facilitating different policy preferences
MULTILATERAL
CONVENTION TO
IMPLEMENT TAX TREATY
RELATED MEASURES TO
PREVENT BASE EROSION
AND PROFIT SHIFTING
Elements of flexibility
Specifying tax agreement covered
Meeting a Minimum Standard in another way
Opting out non-Minimum Standard provisions
Applying additional or alternative provisions
5

6. 78
MLI POSITIONS
PROVISIONAL
76
MULTILATERAL
CONVENTION TO
IMPLEMENT TAX TREATY
RELATED MEASURES TO
PREVENT BASE EROSION
AND PROFIT SHIFTING
Signatures
oe.cd/mli
6

7. 0
10
20
30
40
50
60
70
80
2017/2nd 2018/1st 2018/2nd 2019 and beyond
Projected timing ratification

8. 8
Entry into force
8
• Entry into force of the MLI
• Ratification by 5 signatories required
• Entry into force for each other signatory
1 2 3 4 5
• MLI in force

9. Jurisdictions signed up
First five ratify > MLI in Force
MLI modifies Covered Tax Agreements
Entry into force: impact on treaty networks
9