Base erosion and profit shifting

Ground-breaking multilateral BEPS convention signed at OECD will close loopholes in thousands of tax treaties worldwide


07/06/17 - Ministers and high-level officials from 76 countries and jurisdictions have signed today or formally expressed their intention to sign an innovative multilateral convention that will swiftly implement a series of tax treaty measures to update the existing network of bilateral tax treaties and reduce opportunities for tax avoidance by multinational enterprises. The new convention will also strengthen provisions to resolve treaty disputes, including through mandatory binding arbitration, thereby reducing double taxation and increasing tax certainty.

The signing ceremony for the Tax took place during the annual OECD Week, which brings together government officials and members of civil society from OECD and partner countries to debate the most pressing social and economic challenges confronting society. In addition to those signing today, a number of other jurisdictions are actively working towards signature of the convention and more are expected to follow by the end of 2017.

Today’s signing ceremony marks an important milestone in the international tax agenda, which is moving closer to the goal of preventing base erosion and profit shifting (BEPS) by multinational enterprises. The new convention, which is the first multilateral treaty of its kind, allows jurisdictions to transpose results from the OECD/G20 BEPS Project into their existing networks of bilateral tax treaties. It was developed through inclusive negotiations involving more than 100 countries and jurisdictions, under a mandate delivered by G20 Finance Ministers and Central Bank Governors at their February 2015 meeting.
  Signing Ceremony for Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS

“The signing of this multilateral convention marks a turning point in tax treaty history,” said OECD Secretary-General Angel Gurría. “We are moving towards rapid implementation of the far-reaching reforms agreed under the BEPS Project in more than 1,100 tax treaties worldwide, and radically transforming the way that tax treaties are modified. Beyond saving signatories from the burden of re-negotiating these treaties bilaterally, the new convention will result in more certainty and predictability for businesses, and a better functioning international tax system for the benefit of our citizens. Today’s signing also shows that when the international community comes together there is no issue or challenge we cannot effectively tackle.” Read the full speech

The OECD/G20 BEPS Project delivers solutions for governments to close the gaps in existing international rules that allow corporate profits to « disappear » or be artificially shifted to low or no tax environments, where companies have little or no economic activity. Revenue losses from BEPS are conservatively estimated at USD 100-240 billion annually, or the equivalent of 4-10% of global corporate income tax revenues. Almost 100 countries and jurisdictions are currently working in the Inclusive Framework on BEPS to implement BEPS measures in their domestic legislation and bilateral tax treaties. The sheer number of bilateral treaties makes updates to the treaty network on a bilateral basis burdensome and time-consuming.

The new multilateral convention will solve this problem. It will modify existing bilateral tax treaties to swiftly implement the tax treaty measures developed in the course of the OECD/G20 BEPS Project. Treaty measures that are included in the new multilateral convention include those on hybrid mismatch arrangements, treaty abuse, permanent establishment, and mutual agreement procedures, including an optional provision on mandatory binding arbitration, which has been taken up by 25 signatories.

The first modifications to bilateral tax treaties are expected to enter into effect in early 2018.

The OECD is the depositary of the multilateral convention and is supporting governments in the process of signature, ratification and implementation. The position of each signatory under the convention is now available on the OECD website. By the end of 2017, the OECD will provide a database and additional tools on its website, facilitating the application of the convention by taxpayers and tax administrations.

The text of the convention, the explanatory statement and background information are available at:

Photos from the signing ceremony, including images of all signatories, are available for download from a dedicated Flickr album.

A Q&A session via webinar will be delivered on Friday 9 June at 15:00 (CET). To register, please go to

Media queries should be directed to Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration, (+33 6 26 30 49 23) or the OECD Media Office (+33 1 45 24 97 00).


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