Strengthening the EU Arbitration Procedure

The fight against base erosion and profit shifting and the guarantee of effective double taxation dispute resolution mechanisms are closely knit concerns.
Preventing tax fraud and avoidance is important to countries because they all want their fair share of tax revenues. Likewise, effective and efficient double taxation dispute resolution mechanisms are important to taxpayers engaged in cross-border transactions.

The OECD and the EU share all of these concerns. The EU discussed BEPS and the corporate tax system in its 2015 action plan, while the OECD addressed the same in its BEPS action items. Turning to the question of dispute resolution, last October 25 the EU published the ‘‘Proposal for a Council Directive on Double Taxation Dispute Resolution Mechanisms in the European Union’’ (proposed directive).

In this article, the authors examine the European Commission’s proposed directive on double taxation dispute resolution mechanisms and discuss how the EU arbitration procedure could be amended to more effectively reduce double taxation.