The OECD provides a comprehensive list of countries that have signed the new multilateral instrument (MLI).
Most importantly, each country’s position on the various positions with other countries can be viewed. While being transparent, this myriad of menu selections will produce an even more complex environment globally. The strive for collaboration is somewhat achieved, based on more than 60 countries executing this document. However, the goal of simplification can certainly be questioned.
OECD’s press release and a link to this list is provided for reference. All international tax practitioners should review this long-awaited document.
Thirty-one countries have signed the OECD’s multilateral competent authority agreement (MCAA) for the automatic exchange of country-by-country (CbC) reports, excluding the U.S.
The signatory countries are:
- Costa Rica
- Czech Republic
- Slovak Republic
- South Africa
The position of the US, noticeably absent from the list, is to enter into bilateral agreements with appropriate countries that have safeguards and governance in place, as well as countries that have an income tax treaty or tax information exchange agreement in effect.
OECD BEPS Action 13 provided models for the recommended CbC reporting options; a multilateral agreement, a double tax convention model and a model based on a tax information exchange agreement.
It will be critical to monitor the development of the CbC exchange process, in addition to timing mismatches and the necessity to identify a surrogate country, with additional complexities to consider.