A large majority of jurisdictions in the process of changing international tax conventions have taken action to prevent treaty shopping and other forms of treaty abuse, the Organisation for Economic Cooperation and Development (OECD) said on Thursday.

There are 95 jurisdictions imposing a minimum tax rate as part of the OECD's Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (BEPS MLI) that prevents cross-border corporate tax avoidance by multinational groups and speeds dispute resolution.

A third peer review report on assessing jurisdictions' efforts to prevent tax treaty shopping and other forms of treaty abuse under Action 6 of BEPS revealed that a large majority of members are translating their commitment into actions and are modifying their treaty network.

As one of the four minimum standards, BEPS Action 6 identified treaty abuse, and in particular treaty shopping, as one of the principal sources of BEPS concerns. Treaty shopping typically involves the attempt by a person to access indirectly the benefits of a tax agreement between two jurisdictions without being a resident of one of those jurisdictions.

All members have committed to implementing the Action 6 minimum standard and participate in annual peer reviews to monitor its accurate implementation.

The data demonstrates that the BEPS MLI has been the tool used by the vast majority of jurisdictions that have begun implementing the Action 6 minimum standard, and that the MLI has started to impact tax treaties of jurisdictions that have ratified it.

The impact and coverage of the MLI are expected to rapidly increase as jurisdictions continue their ratifications and as other jurisdictions with large tax treaty networks consider joining it.

Greece and Hungary were the latest to join the BEPS MLI as they deposited their ratification instruments in late March, allowing the treaty to enter into force on July 1.