Dealing with Treaty Shopping Across the Tax, Trade, and Investment Regimes
摘要
The bilateral governance of a specific cross-border policy issue creates incentives for economic actors from less favoured countries to take advantage of rules that apply to actors from more favoured countries. This is the case across the international tax, trade, and investment regimes: In tax and investment regimes, multinational enterprises engage in treaty shopping to gain the advantage of a more favourable treaty that a country of destination of investment has signed with a third country. In the trade regime, traders may reroute goods through a third country to take advantage of a preferential agreement that the destination country has concluded with the third country. International organizations and states have proposed different types of solutions to deal with this problem that is present across the three regimes, including limitations on benefits rules and General Anti Avoidance Rules in the tax and investment regimes, as well as rules of origin inserted into trade agreements. However, the effectiveness of each approach remains debatable. This chapter compares the characteristics of the approaches taken, discusses why international organizations and countries have privileged one response over the other, and reviews the literature that discusses their suitability.