OECD releases revised BEPS discussion draft on avoidance of PE status

The OECD on May 15 released a revised discussion draft under action 7 of the OECD/G20 base erosion profit shifting (BEPS) action plan concerning artificial avoidance of permanent establishment (PE) status.

The draft, prepared by Working Party No. 1 (WP1) of the OECD’s Committee on Fiscal Affairs, addresses commissionaire structures, the avoidance of PE status through specific activity exemptions, and other issues.

The draft updates an October 31 draft on action 7 which provided alternative options on how to deal with PE avoidance strategies. The October draft received 98 comments and was the subject of a January 21 hearing.

In the new draft, WP1 describes the proposals selected from among the options for each PE avoidance strategy that it believes most suited to address the strategy.

WP1 seeks comments on the updated draft by June 12, and specifically requests that comments be kept as short as possible. There will be no public hearing on the draft.

See:

• Revised discussion draft BEPS Action 7: Preventing The Artificial Avoidance Of PE Status, 15 May 2015 – 12 June 2015

• Release of a new discussion draft on BEPS Action 7 (Prevent the Artificial Avoidance of PE Status)

Related MNE Tax articles:

• OECD releases BEPS discussion draft on preventing artificial avoidance of PE status

• OECD releases 178 comments to BEPS drafts on treaty abuse and artificial avoidance of PEs