19/12/2019 – Jordan has today signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the Convention), becoming the 93rd jurisdiction to join the Convention, which now covers over 1,650 bilateral tax treaties. H.E. Mr. Makram Queisi, Ambassador Extraordinary and Plenipotentiary of the Hashemite Kingdom of Jordan to France, signed the Convention at a signing ceremony held in Paris.
L-R: H.E. Mr. Makram Queisi, Ambassador Extraordinary and Plenipotentiary of the Hashemite Kingdom of Jordan to France and Mr. Ulrik Vestergaard Knudsen, Deputy Secretary-General, OECD.
The Convention is the first multilateral treaty of its kind, allowing jurisdictions to integrate results from the OECD/G20 BEPS Project into their existing networks of bilateral tax treaties. The OECD/G20 BEPS Project delivers solutions for governments to close the gaps in existing international rules that allow corporate profits to be artificially shifted to low or no tax jurisdictions, where companies have little or no economic activity. The Convention became effective on 1 January 2019 and now applies to 133 tax treaties concluded among the 38 jurisdictions that have already deposited their instrument of acceptance, approval or ratification.
The Convention, negotiated by more than 100 countries and jurisdictions under a mandate from the G20 Finance Ministers and Central Bank Governors, is one of the most prominent results of the OECD/G20 BEPS project. It is the world’s leading instrument for updating bilateral tax treaties and reducing opportunities for tax avoidance by multinational enterprises. Measures included in the Convention address treaty abuse, strategies to avoid the creation of a "permanent establishment", and hybrid mismatch arrangements. The Convention also enhances the dispute resolution mechanism, especially through the addition of an optional provision on mandatory binding arbitration, which has been taken up by 30 jurisdictions.
The text of the Convention, the explanatory statement, background information, database, and positions of each signatory are available at http://oe.cd/mli.