Greece signed the OECD Multilateral Convention (MLI) on 7 June 2017
On 7 June 2017, 68 countries and jurisdictions, including Greece, signed the OECD Multilateral Convention (“MLI”), while a number of jurisdictions have also expressed their intention to sign it. The MLI is a multilateral legal instrument that focuses on the implementation of tax treaty-related measures which resulted from the OECD Base Erosion and Profit Shifting Project (“G20/BEPS Project”), through the update of the existing bilateral tax treaties in a synchronised and effective manner. BEPS-related measures included in the MLI focus on prevention of treaty abuse and artificial avoidance of permanent establishment status, improvement of dispute resolution and neutralisation of the effects of hybrid mismatch arrangements.
After having signed the Convention, countries and jurisdictions need to ratify the MLI pursuant to their domestic legislation. The MLI will enter into force three months after the deposit of the fifth instrument of ratification, acceptance or approval. Six months after the MLI enters into force, it will take effect for the taxes levied (with the exemption of withholding taxes). The implementation of the modified treaty measure between two contracting countries will depend on whether the pair of countries have already a treaty in place, whether the countries are both parties to the MLI, whether the treaty is a covered tax agreement under the MLI for both of them and whether reservations and notifications have been made by either of them. In order to facilitate the procedure, the OECD will launch a public online matching tool, which will be based on a database containing all relevant data from the MLI Positions.
The OECD has released the list of reservations and notifications made by Greece on the MLI, according to which Greece expressed its intention to bring all the treaties it has signed under the MLI. Further developments and particular details as to the statement made by Greece will be reported in our upcoming tax newsletter.