Is the OECD Able to Exert Influence on the Essence of OECD-Inspired EU Secondary Law?

Abstract

Originating in Berlioz, the European Court of Justice (ECJ) has developed a new argumentative pattern when it interprets European Union (EU) secondary law inspired by the work of the Organisation for Economic Co-operation and Development (OECD). The Court has hence extended its assessment procedure, which now reflects a two-tier structure. Its traditional approach to apply an autonomous interpretation of EU secondary law provisions has been paralleled by references to related OECD documents. For this purpose, the Court has endorsed a dynamic interpretation of the OECD’ s Model Tax Convention on Income and on Capital (MTC) and the accompanying Commentary. This development has been addressed to some extent in related research. A comprehensive analysis of the relevant case law, including particularly the recent decision in État luxembourgeois, has, however, not been conducted yet. The significance of such an assessment is particularly clear against the background that a dynamic use of the OECD MTC and its Commentary might allow the OECD, an intergovernmental network that is legitimised by neither the EU nor domestic lawmakers, to influence the meaning of OECD-induced secondary law provisions. Undisputedly, this would have tremendous effects on the current state of power to tax in Europe. This contribution attempts to close this gap in scholarly literature.

Keywords: ECJ case law, interpretation of EU law, OECD MTC, OECD MTC Commentary, dynamic interpretation, democratic legitimacy