The OECD Multilateral Tax Instrument: A Model for Reforming the International Investment Regime?

Brooklyn Journal of International Law, Forthcoming

Ottawa Faculty of Law Working Paper No. 2019-09

60 Pages Posted: 17 Jan 2019 Last revised: 11 May 2019

See all articles by Wolfgang Alschner

Wolfgang Alschner

University of Ottawa - Common Law Section

Date Written: January 6, 2019

Abstract

The international tax and investment regimes display striking similarities. They are both based on thousands of bilateral treaties that follow similar principles but differ in fine print. They each facilitate the free flow of international capital by respectively disciplining fiscal and regulatory host state conduct. Finally, they share common historical foundations and experienced similar periods of rapid diffusion and deep contestation. Yet while the international tax regime recently accomplished a sweeping reform to solve a decades-old legitimacy crisis, the investment regime is still grappling with its own legitimacy crisis and reform. In 2018, the multilateral tax instrument (MLI) entered into force updating thousands of bilateral taxation treaties to curb tax avoidance and prevent treaty abuse. The MLI preserves the existing bilateral tax governance structure while adding new multilateral elements, efficiently modernizes outdated bilateral agreements in both substance and procedure, and sets binding minimum standards while giving states the flexibility to contract out of and around its other provisions. This article argues that the multilateral tax reform, specifically its (1) legal mechanics, (2) content, and (3) design, provides a creative template of how to square bilateralism with multilateralism and can thus serve as inspiration for current efforts to reform the international investment regime.

Keywords: Multilateral instrument, tax regime, investment regime, double taxation treaties, bilateral investment treaties, investment arbitration, reform, OECD

Suggested Citation

Alschner, Wolfgang, The OECD Multilateral Tax Instrument: A Model for Reforming the International Investment Regime? (January 6, 2019). Brooklyn Journal of International Law, Forthcoming; Ottawa Faculty of Law Working Paper No. 2019-09. Available at SSRN: https://ssrn.com/abstract=3311256 or http://dx.doi.org/10.2139/ssrn.3311256

Wolfgang Alschner (Contact Author)

University of Ottawa - Common Law Section ( email )

57 Louis Pasteur Street
Ottawa, K1N 6N5
Canada

Register to save articles to
your library

Register

Paper statistics

Downloads
81
Abstract Views
434
rank
301,025
PlumX Metrics