Dutch Lower Chamber of Parliament passes Bill on MLI

Dutch Lower Chamber of Parliament passes Bill on MLI

13 February 2019

On February 12, 2019 the Dutch Lower Chamber of Parliament passed the Bill for the ratification of the Multilateral Convention (“MLI”) to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting (BEPS) and improve dispute resolution mechanisms. It was also agreed to change the MLI position of the Netherlands with respect to preventing the artificial avoidance of permanent establishment status.

The MLI modifies the application of thousands of bilateral tax treaties concluded to eliminate double taxation. It also implements agreed minimum standards to combat treaty abuse and to improve dispute resolution mechanisms while providing flexibility to accommodate specific tax treaty policies. The MLI was developed through negotiation and adopted in November 2016. The MLI currently covers 87 jurisdictions and entered into force on July 1, 2018 for those countries who had promptly ratified it.

The Bill will now be presented to the Upper Chamber. The MLI provisions can enter into effect for the Netherlands as of January 1, 2020 at the earliest.