On 24 November 2016 the OECD announced that negotiations have been completed by more than a hundred countries on the text of the multilateral instrument to implement the tax treaty-related measures recommended by the project on base erosion and profit shifting (BEPS). The final report on BEPS recommended that a multilateral instrument to modify tax treaties was possible and an ad hoc group has worked on the text of the instrument.
The multilateral instrument aims to modify bilateral tax treaties to quickly implement BEPS treaty-related measures including provisions developed under Action 2 on hybrid mismatch arrangements; Action 6 on preventing the granting of treaty benefits in inappropriate circumstances; Action 7 on preventing the artificial avoidance of PE status; and the measures on minimum standards and best practices under Action 14 to make dispute resolution procedures more effective. The instrument will update the text of more than 2,000 bilateral tax treaties in line with BEPS recommendations.
A signing ceremony is to be held in the week beginning 5 June 2017.
