As part of the ongoing work of the OECD/G20 Inclusive Framework on BEPS (Inclusive Framework), the OECD secretariat is seeking public comments on the 2020 review of BEPS Action 14.
In October 2015 the final report on Action 14 Making Dispute Resolution Mechanisms More Effective was published, containing a minimum standard (the "Action 14 Minimum Standard") with a focus on improving the resolution of tax-related disputes between jurisdictions through the mutual agreement procedure (MAP) by ensuring that:
- Treaty obligations related to the MAP are fully implemented in good faith and MAP cases are resolved in a timely manner;
- Administrative processes are implemented to promote the prevention and timely resolution of treaty-related disputes; and
- Taxpayers can access the MAP process when eligible.
All 137 members of the Inclusive Framework committed themselves to have their compliance with the Action 14 Minimum Standard reviewed and monitored by their peers through a peer review process performed by the FTA MAP Forum. In addition, these members also agreed to annually report their MAP statistics on the basis of a common statistical reporting framework ("MAP Statistics Reporting Framework").
The agreed peer review process consists of two stages. In stage 1 a jurisdiction’s legal and administrative framework in relation to its MAP programme is analysed as well as reported MAP statistics and input from peers. The outcome of this analysis comes in the form of a peer review report that includes recommendations where jurisdictions do not yet meet all elements of the Action 14 Minimum Standard. The follow-up of these recommendations is monitored in stage 2.
The review process was launched at the end of 2016 and comprises the review of 82 members of the Inclusive Framework in 10 separate batches. 48 members obtained a deferral of their peer review until 2020, with the deferral of the seven most recent members of the BEPS Inclusive Framework to be confirmed at the next FTA MAP Forum meeting. Currently, stage 1 of the process has been completed for nine batches with batch 10 well underway, whereas stage 2 has been completed for the first three batches (comprising 21 jurisdictions) and is underway for batches 4-6 (comprising 24 jurisdictions). The finalisation of the stage 2 process for all 10 batches is foreseen for 2021. The outcomes of the peer reviews are made available on the website of the OECD. They show that while significant progress is being made, more needs to be done to improve the effectiveness of the MAP.
