On 22 March 2018 the OECD announced that the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting is to enter into force on 1 July 2018.  The Convention allows the signatories to quickly and efficiently update their existing network of bilateral tax treaties to include the tax treaty related measures recommended in the final reports on base erosion and profit shifting (BEPS). The Convention has been designed to strengthen existing bilateral double tax treaties concluded by signatories without the need for time-consuming bilateral renegotiations that would otherwise be required.

The entry into force of the Convention follows the deposit of a fifth instrument of ratification and shows that the signatories are strongly committed to combating base erosion and profit shifting by multinational enterprises. The Convention will begin to take effect for existing tax treaties from 2019.

The Convention has been negotiated by more than 100 countries and jurisdictions under a mandate from G20 Finance Ministers and Central Bank Governors. The tax treaty measures covered by the Convention include those on hybrid mismatch arrangements, treaty abuse and permanent establishment. The Convention strengthens provisions to resolve tax treaty disputes and could include dispute resolution through mandatory binding arbitration if signatories choose to include this.

The OECD is supporting governments in the process of signature, ratification and implementation of the Convention. The reservations and notifications adopted by each signatory to the Convention have been made available on the OECD website and there is also an interactive database that provides insight into the likely impact of the Convention on the covered double tax treaties.