Base erosion and profit shifting

Remarks at Adoption Ceremony of the BEPS Treaty


Remarks by Angel Gurría,

OECD Secretary-General

Paris, France, 24 November 2016

(As prepared for delivery)



Dear Mr. Chair, Distinguished Members of the Ad Hoc Group, Ladies and Gentlemen:


I am delighted to address you on this historic occasion. On 16 April 1869, the first comprehensive bilateral tax treaty was concluded. A landmark moment in international tax! Another major milestone was reached in 1963 when, shortly after the OECD’s establishment, we released our very first Model Tax Convention, the Draft Double Taxation Convention on Income and Capital. We now have a network of over 3,000 bilateral tax treaties. And today, thanks to the BEPS Project ─ and your hard work! ─ we will again make tax treaty history.


One year ago, we delivered a powerful set of measures (the BEPS Package) to empower all countries to tackle tax avoidance, which collectively costs as much as USD 240 billion in lost revenues ─ or around 10% of global corporate tax revenues ─ every year! This package included a mandate to develop a powerful new legal instrument that facilitates the swift and consistent implementation of the tax treaty‑related BEPS measures. Let’s be clear. We cannot afford to wait another 150 years for the existing, extensive, network of tax treaties to be amended through the time-consuming process of bilateral renegotiation. 


Many said it couldn't be done. There were complex technical challenges to overcome, and hard choices to be made. For example, how do you provide enough flexibility to enable as many countries as possible to sign without introducing excessive complexity?


The drafting exercise was not easy, but you did it and in record time! I congratulate you for your tireless efforts to deliver on such a challenging project, after only a year and a half of negotiation.


This Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS will facilitate implementation of two of the four BEPS minimum standards ─ countering treaty abuse and improving dispute resolution mechanisms ─ alongside other measures to improve tax treaties. It will save countries time by avoiding multiple bilateral negotiations and renegotiations. Most importantly, by having drafted this Convention together, you have ensured consistency in the implementation of the BEPS Project, and also on the interpretation of the text itself, which will result in more certainty and predictability.


I am truly impressed by the large number of countries (99) that have joined this initiative and who are around the table today. More than half are not OECD or G20 members: 55% of this Ad Hoc Group. This in itself is a success, particularly in the context of the new Inclusive Framework on BEPS launched a few months ago, and which already includes 87 countries and jurisdictions.


The finalisation of the text, which we are celebrating today, is just the beginning. We now need to make this Convention operational. First, comes the signature. We need as many countries to sign up as soon as possible. As the depositary of the Convention, the OECD will organise a signing ceremony during the first week of June when we gather for our annual Ministerial Council Meeting. Second, the ratification. This requires a lot of work from you at the national level to ensure that all legal requirements are met. As usual, the OECD Secretariat stands ready to support you.


Ladies and Gentlemen: I hope to see many of your Ministers in June for the signing ceremony, but for now I would like to congratulate you all for the adoption of the Convention. I also want to thank the Chair, Mike Williams, for his leadership, and the Secretariat team, led by Jesse Eggert, for the tireless efforts and creative thinking that went into this ambitious project. Jesse, I understand that you will shortly be leaving the OECD and I’d like to express my gratitude for the invaluable contributions you have made to the BEPS project.


Thank you.