CYIL vol. 15 (2024)

EDITA FILADELFIOVÁ CYIL 15 ȍ2024Ȏ in the BEPS Inclusive Framework and the Global Forum on Transparency and Exchange of Information for Tax Purposes , and participation in relevant legal instruments to avoid being blacklisted . 58 In response to BEPS measures, the revised Code of Conduct was approved on 8 November 2022, which expanded its scope. Besides preferential tax measures, it now also includes “ generally applicable elements” that create conditions for double non-taxation or double/multiple use of tax advantages. 59 From 1 January 2024, the revised Code of Conduct will be effective, where member states commit to abolishing their existing tax measures that promote harmful tax competition and not to introduce such measures in the future. 60 We believe that since the Code of Conduct (business taxation) is the result of cooperation among the governments of member states, such a decision is a sufficiently strong motivation and commitment for individual governments to comply with the code’s rules and adapt their legal systems accordingly. Member states must also transpose the directives we mentioned above, which contain harmful practices themselves. However, it should be noted that the conclusions of the Code of Conduct Group (business taxation) are not legally binding acts of EU law, and therefore, we do not yet consider this OECD measure fully implemented. 2.2.4 Non-implemented BEPS Measure No. 6: Prevention of abuse of tax treaties Measure No. 6 focuses on preventing the abuse of tax treaties to achieve double non taxation or tax reduction through treaty shopping and other strategies. Tax treaties were being exploited for inappropriate profit shifting or tax avoidance by utilizing legal loopholes or mismatches in tax treaties. According to BEPS Measure No. 6, the term tax avoidance differs from the one established under EU law. The difference can be seen in the objectives of these two international organizations. While the goal of EU law is to create an internal market by removing border restrictions, the goal of the BEPS project is to protect the national tax base of a state. 61 As part of Measure No. 6, the Multilateral Instrument (MLI) was developed, which allows signatory countries to amend their existing tax treaties to include provisions that prevent abuse. The importance of this issue is highlighted by the fact that all EU countries have acceded to the MLI to date. 62 An example of a BEPS measure that has effects within the national legal systems of member states but not within EU law as such is the MLI. In practice, the implementation 58 TAXNEWS.EY., 2022. EU Finance Ministers agree on Code of Conduct mandate reform. (cit. 2024-03-02). Avail able online: https://taxnews.ey.com/news/2022-1687-eu-finance-ministers-agree-on-code-of-conduct-mandate reform#:~:text=The%20Code%20of%20Conduct%20has,legal%20instruments%2C%20in%20order%20to. 59 COUNCIL OF THE EU, 2024. Code of Conduct Group (Business Taxation). (cit. 2024-02-03). Available online: https://www.consilium.europa.eu/en/council-eu/preparatory-bodies/code-conduct-group/. 60 Council conclusions on the reform of the Code of Conduct for Business Taxation that took place on 8 November 2022. 14452/22. Available online: https://data.consilium.europa.eu/doc/document/ST-14452-2022-INIT/sk/pdf. 61 JUKA, A. 2016. Is BEPS Action 6 “Preventing Treaty abuse” compatible with the EU Law concept of abuse? Lund University School of Economics and Management Department of Business Law, p. 23. Available online: https:// lup.lub.lu.se/luur/download?func=downloadFile&recordOId=8880181&fileOId=8880183. 62 OECD, 2024. Signatories and Parties to the Multilateral Convention to Implement Tax Treaty related measures to prevent Base Erosion and Profit Shifting (Status as of 29 February 2024). (cit. 2024-02-03). Available online: https://www.oecd.org/tax/treaties/beps-mli-signatories-and-parties.pdf.

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