On May 28th, 2025, Law No. 27,788 was published in Argentina’s Official Gazette, through which the country ratifies the “Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting” (commonly known as the “BEPS Multilateral Instrument” or “BEPS MLI”).
This international treaty, signed in Paris in November 2016 under the OECD/G20 BEPS Project, allows for simultaneous and coordinated amendments to bilateral tax treaties without the need to renegotiate each one individually.
Why is this important?
Argentina joins a global network of countries committed to combatting aggressive tax planning and treaty abuse strategies that erode national tax bases. The MLI is a cornerstone of the OECD/G20 BEPS package, aiming to ensure that profits are taxed where the underlying economic activity takes place.
How does the BEPS MLI work?
The MLI acts as a “mother convention” that modifies specific clauses of bilateral tax treaties designated as “Covered Tax Agreements”. These changes only apply when both signatory countries have ratified the MLI and opted to apply the same provisions.
This mechanism enables the rapid and synchronized update of multiple tax treaties across jurisdictions without engaging in a bilateral renegotiation process treaty-by-treaty.
What does it change?
Key changes introduced by the MLI include:
- Incorporation of anti-abuse clauses such as the Principal Purpose Test (PPT), which denies treaty benefits where one of the main purposes of an arrangement is to obtain those benefits improperly.
- Revisions to the definition of permanent establishment to address artificial structures.
- New rules on transparent entities and dual residency.
- Minimum standards for dispute resolution and arbitration mechanisms.
Who is affected?
The MLI is particularly relevant for:
- Multinational groups with international structures.
- Local companies involved in cross-border transactions.
- Institutional investors and funds operating across multiple jurisdictions.
Next steps
Following legislative ratification, Argentina must notify the OECD of the tax treaties it wishes to cover and indicate its selected options and reservations. The MLI will enter into force for Argentina three months after notification, but its effective application to each bilateral treaty will depend on the status of the other contracting state.
In line with OECD recommendations (OECD (2018), Guidance for the development of synthesised texts, Multilateral Convention to Implement Tax Treaty Measures to Prevent BEPS, OECD, Paris. (available here), t is expected that the Argentine Federal Tax Authority (ARCA) will, in the coming months, prepare and publish synthesized texts of the modified treaties. These texts combine the original treaty with the MLI modifications and are a key tool to clearly understand how each international agreement has been effectively redrafted.
Recommended actions
Now is the time for companies with international operations to review their structures, agreements, and tax strategies under the new framework. Anti-abuse provisions and the redefinition of permanent establishment may have a material impact on tax burdens and fiscal exposure in Argentina and abroad.
Our team is available to provide tailored advice on how this multilateral instrument may affect your specific situation and to assist in reviewing international structures.
