The Global Minimum Tax | Selected Issues on Pillar Two

S. 3161. Introduction

The GloBE Model Rules apply to Constituent Entities (CEs) of an MNE Group that meets the consolidated revenue threshold of EUR 750 million. However, many MNE Groups contain entities that are not wholly owned. This thesis examines the application of the GloBE Model Rules to split-ownership structures, particularly focusing on their impact on minority shareholders outside the MNE Group.

First, section 2 delves into the necessity of distinct rules for split-ownership structures. It begins by exploring whether minority shareholders outside the MNE Group are subject to the GloBE rules (section 2.1.) followed by an analysis of the potential ramifications of applying the IIR and the UTPR without distinct rules for split-ownership structures (section 2.2.). Subsequently, section 3. provides a comprehensive overview of how split-ownership structures are treated under the GloBE Model Rules. This overview distinguishes between split-ownership structures as Constituent Entities of an MNE Group and unconsolidated Joint Ventures (JVs), while also addressing the special treatment of Minority-Owned Constituent Entities (MOCEs), and the application of the UTPR to split-ownership struc...