Non-Discrimination in European and Tax Treaty Law

I. S. 130Introduction

Currently, the Organisation for Economic Co-operation and Development (OECD) is working on the Base and Erosion Profit Shifting project (hereinafter – BEPS) in order to make some essential changes to the global tax policy landscape. Concerning this matter, basic changes are essential to effectively avoid double non-taxation, as well as situations of no or low taxation in connection with practises that artificially isolate taxable income from the activities that generate it. The BEPS Action Plan, which was well-negotiated and written with lively participation of the OECD Member countries, comprises fifteen individual action points and procedures. The BEPS Action Plan 2 gives guidance to cross-border coordination issues and the design of domestic rules to neutralize the effect of hybrid mismatch arrangements. Moreover, Action Plan 3 emphasizes the need to address base erosion and profit shifting by applying controlled foreign company (CFC) provisions. The BEPS project perceives that groups can create low-taxed foreign affiliates to which they relocate income and that these foreign affiliates may be introduced in low-tax countries wholly or partly for tax motives rather...