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OECD welcomes Gib into BEPS framework

REUTERS/Jon Nazca

The Organisation for Economic Co-operation and Development has welcomed and agreed that Gibraltar should become a full member of the Inclusive Framework on Base Erosion Profit Shifting (BEPS), a global mechanism to strengthen tax transparency.
Gibraltar's entry in to the BEPS framework had been blocked by Spain but Madrid has lifted its veto following the signing of the tax treaty covering Gibraltar and Spain.
Chief Minister Fabian Picardo confirmed Gibraltar’s membership in a letter to the OECD Secretary General last week.
“Our joining the OECD BEPS framework as a full and equal member is another demonstration of Gibraltar’s commitment to international standards of tax transparency and cooperation," Mr Picardo said yesterday.
"It is also a tangible deliverable resulting from the conclusion of the International Tax Treaty with Spain."
"The public should not underestimate the amount of work that went on behind the scenes to ensure this has come to fruition after a very significant period of time."
"In particular, the tax treaty that was signed with Spain was a key to ensuring distinct progress in this matter and I would therefore like to reiterate my thanks to the Financial Secretary and to the Commissioner of Income Tax."
"The work of Albert Mena, John Lester and Terrence Rocca on this has been remarkable. They have worked alongside my core Brexit negotiating team and Albert Isola's Finance Centre team to deliver this excellent result."
"Furthermore, this once again bolsters Gibraltar's unimpeachable reputation as a robust and reputable financial centre as we form part of another international forum on good tax governance, thereby shielding us from inclusion on any international blacklists on BEPS going forward, which is hugely important for the continued success of the finance centre."
"This will undoubtedly assist in underpinning Gibraltar’s future economic success and is simply another occasion when this Government actively ensures the protection of Gibraltar and its people; more so in these challenging times as the United Kingdom prepares to leave the European Union.”
Although Spain lifted its veto to Gibraltar joining the BEPS framework, it tabled a declaration setting out its position on sovereignty given Gibraltar's inclusion.
In the declaration, Spain set out its view that Gibraltar was a non-autonomous territory whose international relations were the responsibility of the UK and which was subject to the UN decolonisation process.
"The authorities of Gibraltar are of a local nature and exercise exclusively internal competences which have their origin and their foundation in the distribution and attribution of competences performed by the United Kingdom, in compliance with its internal legislation, in its capacity as sovereign State on which the mentioned non‐autonomous territory depends," Spain said in the declaration.
It added that for Spain, Gibraltar's inclusion in the BEPS framework was "exclusively within the scope of the internal competences of Gibraltar".
"The application to Gibraltar of the present Convention cannot be interpreted as recognition of any rights or situations involving matters not included in Article 10 of the Treaty of Utrecht of 13 July 1713, signed by the crowns of Spain and Great Britain," Spain added.