OECD Legal Instruments related to Capital Movements and Trade in Services
Adhered to by 38 countries, including twelve G20 countries, the Capital Movements Code is the sole binding multilateral agreement among State parties dedicated to openness, transparency and international cooperation on the full range of cross-border capital flows. The Current Invisibles Code covers current account transactions including cross-border trade in services. Adopted in 1961, the OECD Codes are key elements of the international framework for economic co-operation and founding legal instruments of the OECD. Since 2012, the Codes are open to adherence by non-OECD members and in 2019, a major review of the instruments was endorsed by OECD Ministers.
The OECD is an important contributor to global debates on international capital flows. How best to reap the benefits of capital flows while mitigating the risks associated with their volatility in a changing global financial system has been the focus of the Advisory Task Force (ATFC) since its creation in 2012. The ATFC is composed of governmental experts from OECD and non-OECD countries as well as experts from relevant international organisations such as the IMF and the WTO, and meets regularly to address questions relating to the heightened international co-operation and policy dialogue on capital flow management. The empirical research produced by the OECD Secretariat aims at enhancing understanding of capital flow dynamics and policy effectiveness, supporting the ATFC work and the OECD’s contributions to the G20 Finance Track.
Contributions to the G20
The G20 is discussing ways to help countries make the most of capital flows. The OECD’s Code of Liberalisation of Capital Movements is an important contribution to this debate.