In depth
Background and ratification process
The MLI, signed in Paris in 2016 as part of the OECD/G20 BEPS project, is an international instrument that allows for the efficient and simultaneous modification of existing DTTs, without the need to renegotiate each bilateral treaty individually. This feature is a key innovation of the MLI, as it enables the coordinated and agile amendment of a broad network of treaties. Argentina signed the MLI in 2017 and, following parliamentary approval through Law 27,788, completed the process with the formal deposit before the OECD.
Global scope and relevance
With Argentina’s accession, more than 90 jurisdictions have now ratified, accepted or approved the MLI, resulting in the modification of over 1,600 bilateral DTTs. According to the OECD, around 350 additional treaties are expected to be modified as the MLI is ratified by all signatories. The OECD highlighted that this ratification strengthens the global fight against tax evasion and avoidance, and consolidates Argentina’s commitment to transparency and international tax cooperation.
Main effects and changes
The MLI introduces automatic modifications to DTTs designated as ‘covered tax agreements’ by both parties. The main measures incorporated include prevention of treaty abuse, mitigation of strategies to avoid the creation of permanent establishments, and neutralization of hybrid mismatch arrangements. In addition, the MLI provides for improvements in dispute resolution mechanisms.
Entry into force
The MLI will take effect from 1January 2026, provided both parties have completed the ratification process.
Covered agreements
Upon depositing the instrument of ratification, Argentina notified the OECD of the DTTs that will be covered by the MLI. This list includes treaties concluded with the following countries: Germany, Australia, Belgium, Bolivia, Brazil, Canada, Chile, Denmark, Spain, Finland, France, Italy, Mexico, Norway, the Netherlands, the United Kingdom, Russia, Sweden, Switzerland, and the United Arab Emirates.
The effective application of the MLI modifications to each treaty will depend on whether the counterparty has also ratified the instrument and notified the same agreement as covered. The complete and updated list, together with specific reservations and notifications, can be viewed on the official OECD website (see the official document).
Implications for companies
The MLI’s entry into force represents a significant change for multinational companies with operations in Argentina, which should review their structures and international transactions in light of the new provisions.
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