On 18 December 2018 Malta ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting, more commonly referred to as the Multilateral Instrument (MLI).  Malta has expressed a number of reservations and these may be viewed by accessing  http://www.oecd.org/tax/treaties/beps-mli-position-malta.pdf


The MLI is an OECD initiative with the objective of providing concrete solutions for governments to close the gaps in existing international tax rules by transposing results from the OECD/G20 BEPS Project into bilateral tax treaties worldwide.  The MLI covers topics from transparent entities, dual resident entities, methods for elimination of double taxation as well as treaty abuse.


As a result of Malta’s implementation of the MLI, double taxation treaties must now be interpreted in light of the MLI provisions.  Counties adhering to the MLI provisions will have greater powers in ensuring that treaty abuse is limited and double non-taxation avoided.