Arbitration in international tax matters

" ICC has a long history of promoting arbitration as an appropriate and efficient means of resolving such taxation disputes, having issued a position paper on the subject in 1984. During the intervening 15 years, while there has been some progress in the international arena, the acceptance of proper arbitration provisions is still not widespread. In our view, the time is ripe to revisit the matter.

Based upon the broad experience of ICC in commercial arbitration, we believe that this form of dispute resolution is both attractive and effective. It presents significant advantages to businesses and governments. These include not only the cost-effective and equitable resolution of tax controversies, but also the enhancement of global economic growth and development through elimination of unintended instances of double taxation.

Therefore, we submit this position paper in order to encourage governments to adopt and promote the use of arbitration as a means of resolving international tax disputes. We recommend that compulsory and binding arbitration in international tax matters should be adopted in bilateral or multilateral tax conventions. We believe that the OECD is an appropriate forum in which to develop such instruments and we encourage all governments to negotiate bilateral or multilateral conventions for arbitration of tax controversies.