BEPS Action 4 and Its Compatibility with the Principle of Non-Discrimination Under Article 24(4) of the OECD Model Convention - Intertax View BEPS Action 4 and Its Compatibility with the Principle of Non-Discrimination Under Article 24(4) of the OECD Model Convention by - Intertax BEPS Action 4 and Its Compatibility with the Principle of Non-Discrimination Under Article 24(4) of the OECD Model Convention 47 1

The final reports of the OECD Base Erosion and Profit Splitting (BEPS) Project were published in October 2015. The OECD’s recommendations include an approach to address the risks of base erosion and profit shifting caused by the deduction of interest and other financial payments, namely by implementing a fixed ratio rule, which can be complemented by a group ratio rule. The implementation of the BEPS Action 4 recommended approach could lead to certain issues related to its compatibility with domestic law and with tax treaty obligations. This article addresses one of these issues by analysing the compliance of the BEPS Action 4 recommended approach with tax treaty obligations, mainly with the principle of nondiscrimination under Article 24(4) of the OECD Model Convention.

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