06/10/2022 – Today, Mongolia signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the BEPS Convention), at a signing ceremony held in Paris at the 14th meeting of the Inclusive Framework on BEPS. Mongolia has become the 100th jurisdiction to join the BEPS Convention, which now covers around 1850 bilateral tax treaties. This represents an important milestone in the implementation of treaty-related BEPS measures and the strengthening of the global tax treaty network.
L-R: Grace Perez-Navarro (Deputy Director, OECD Centre for Tax Policy and Administration), Gita Kothari (Deputy Director, OECD Legal Department), Jigjid Ganbat (State Secretary, Ministry of Finance, Mongolia), Telmuun Byambaragchaa (Director General, Tax Policy Department, Ministry of Finance, Mongolia)
In addition, on 30 September South Africa deposited its instrument of ratification for the BEPS Convention, thus underlining its strong commitment to prevent the abuse of tax treaties and BEPS by multinational enterprises. The BEPS Convention will enter into force on 1 January 2023 for South Africa.
As of today, 910 treaties concluded among the 79 jurisdictions which have ratified, accepted or approved the BEPS Convention have been modified by the BEPS Convention. Around 930 additional treaties will be modified once the BEPS Convention will have been ratified by all Signatories.
The BEPS 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 BEPS Convention address treaty abuse, strategies to avoid the creation of a “permanent establishment”, and hybrid mismatch arrangements. The BEPS 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 33 jurisdictions.
The text of the BEPS Convention, the explanatory statement, background information, database, and positions of each signatory are available at https://oe.cd/mli.