background image
BEPS MLI Enters into Force on 1 July 2018 — Orbitax Tax News & Alerts

The OECD announced on 22 March 2018 that the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) will enter into force on 1 July 2018. The entry into force is brought about by the deposit of the ratification instrument for the MLI by a fifth signatory, Slovenia, on 22 March. The other four signatories that have deposited their ratification instrument include Austria on 22 September 2017, the Isle of Man on 19 October 2017, Jersey on 15 December 2017, and Poland on 23 January 2018. For these five jurisdictions, the MLI enters into force on 1 July for the respective covered agreements (tax treaties) between them, and the agreed upon (matched) provisions of the MLI will generally apply from 2019. Of the five jurisdictions, covered agreements impacted by the MLI include the 2004 Austria-Poland tax treaty, the 1997 Austria-Slovenia tax treaty, and the 1996 Poland-Slovenia tax treaty.

For the other MLI signatories, the MLI will enter into force on the first day of the month following a three month period after the second party to a covered agreement deposits their ratification instrument. Once in force, the provisions of the MLI will generally apply from 1 January of the year following its entry into force in respect of withholding taxes, and for all other taxes levied with respect to taxable periods beginning on or after the expiration of a 6-month period following the date of entry into force (or a shorter period if agreed to by both parties).

Click the following links for the list of signatories to date and the OECD's MLI Matching Database.