CFE’s Top 5 – 10 November 2025

BRUSSELS | 10 NOVEMBER 2025

Third Session of Intergovernmental Negotiations for UN Framework Convention on International Tax Cooperation

The UN Intergovernmental Committee to draft a Framework Convention on International Tax Cooperation is commencing its third session this week, which will run from 10 to 19 November 2025, in Nairobi, Kenya. The session forms part of the Member State–led negotiations to develop a new multilateral framework for international tax cooperation, as mandated by UN General Assembly Resolution 78/230. The session will focus on progressing discussions under Workstream I on the draft Framework Convention, and under Workstream III on Protocol 2 concerning the prevention and resolution of tax disputes.

Discussions during the first week will be organised primarily around the Co-Leads’ Draft Framework Convention Template, covering substantive elements of the proposed convention. These include provisions on the fair allocation of taxing rights, the taxation of high-net-worth individuals, mutual administrative assistance, harmful tax practices, and sustainable development. The Committee is expected to conduct article-by-article deliberations in a series of closed and informal meetings, which will also serve to test possible formulations and areas of convergence. Sessions will address, inter alia, Articles 4–10 of the draft, including the interrelationship between tax cooperation and environmental, social and economic development objectives.

In the second week, the Committee will turn to Protocol 2 on dispute prevention and resolution, guided by the Co-Leads’ Concept Note on Ideas for Potential Solutions. This note proposes a menu of optional mechanisms, including mutual agreement procedures (MAP), joint audits, mediation, and arbitration, with a particular emphasis on flexibility and accessibility for developing countries. Issues such as optionality, scope of application, support for “no-treaty” situations, and the potential role of the UN as a supporting platform for dispute resolution will also be examined.

Written inputs on both Co-Leads documents may still be submitted by Member States and stakeholders by 5 December 2025 at 11:59 PM New York time. Submissions must include a 250-word abstract and may not exceed 3,000 words for Member States or 2,000 words for stakeholders, per document. Further details are available on the Committee’s webpage.

OECD Publishes Preliminary 2025 Report on Mutual Agreement Procedures

The OECD has released a preliminary version of its 2025 Consolidated Information on Mutual Agreement Procedures, with the final edition due for publication in mid-November. The report brings together country-specific information on the operation of Mutual Agreement Procedures (MAPs) under BEPS Action 14 for all Inclusive Framework jurisdictions. It provides an overview of each jurisdiction’s MAP programme, peer-review outcomes and 2024 statistical data, offering a single reference point on global dispute-resolution practices.

The statistical data for 2024 were presented by the OECD at this year’s Tax Certainty Day, forming the centrepiece of discussions on international tax dispute prevention and resolution. The figures show that global MAP inventories have reached record levels, exceeding 6,700 pending cases. While closures increased slightly, new cases once again outpaced resolutions – particularly in transfer pricing disputes. Average resolution times improved modestly, with MAP cases concluding in around 27 months on average, down from 29 months the previous year. Transfer pricing cases remain lengthier, averaging 30.9 months compared with 24.5 months for other cases.

Around 76 % of MAP cases achieved full resolution for taxpayers, and only 4 % were closed without agreement, indicating a high degree of cooperation among competent authorities. The stock of older cases continues to fall, with just 3.3 % dating from before 2016 and more than half of all cases now under two years old.

Transfer pricing disputes continue to dominate MAP activity, representing over 60% of all cases and reflecting ongoing complexity and divergent interpretations of the OECD Transfer Pricing Guidelines. While jurisdictions such as the Netherlands, Canada and Japan report resolution rates above 80%, others face persistent backlogs and extended timelines. The OECD has reiterated the need for consistent implementation of the Action 14 minimum standard and enhanced resources for competent authorities.

The 2025 report also highlights progress in digitalisation and oversight through the MAP Statistics Reporting Framework and the Tax Certainty Hub, which improve transparency and comparability across jurisdictions. The upcoming 2025 peer-review cycle will assess the timely implementation of dispute-prevention measures and follow-up on earlier recommendations.

CJEU Dismisses Appeal Concerning EU Pillar Two Directive Top-Up Tax 

The Court of Justice of the European Union delivered its judgment in Fugro NV v Council of the European Union (C-146/24 P), concerning an action for annulment brought against the EU’s Pillar Two Directive (Directive 2022/2523). The Court upheld the General Court’s earlier decision that Fugro, a Dutch multinational taxed under the Netherlands’ tonnage tax regime, lacked standing to challenge the Directive. The case centred on Fugro’s claim that the Directive’s limited exclusion for international shipping income effectively neutralised the benefit of the Dutch tonnage tax, authorised by the European Commission, by subjecting it to the Pillar Two top-up tax.

The CJEU found that Fugro was not individually concerned by the Directive, which is a measure of general application applying uniformly to all multinational groups meeting its criteria. The Court rejected arguments that the beneficiaries of national tonnage tax schemes formed a “limited class” of operators, noting that the Dutch regime remained open to any qualifying taxpayer and could not be considered a closed or identifiable group at the time of adoption. As such, Fugro could not demonstrate individual concern within the meaning of Article 263(4) TFEU.

The Court’s decision was confined to procedural admissibility and did not address any substantive issues regarding the compatibility of the Pillar Two Directive with EU law or its interaction with approved State aid regimes. The ruling confirms that companies cannot directly contest the validity of the Pillar Two Directive through annulment proceedings, leaving open broader questions on the Directive’s legal and practical interaction with existing sectoral tax regimes. A separate case referred by the Belgian Constitutional Court, concerning the compatibility of the Undertaxed Payments Rule (UTPR) with EU law, is still pending before the CJEU.

ECOFIN Ministers to Advance Energy Tax & Customs Reform

EU Finance Ministers will meet in Brussels on 13 November 2025 for the Economic and Financial Affairs Council (ECOFIN), with an agenda focused on energy taxation, customs simplification and fiscal governance.

Ministers are expected to reach a general approach on the revision of the Energy Taxation Directive, a key file in the EU’s climate and fiscal policy framework. The proposal aims to align energy taxation with environmental objectives by restructuring minimum tax rates according to energy content and carbon intensity, modernising the treatment of electricity and alternative fuels, and supporting the transition to a low-carbon economy.

A political agreement is also anticipated on a Regulation introducing a simplified tariff treatment for distance sales of goods and abolishing the customs duty-relief threshold. The measure is designed to simplify import procedures for e-commerce transactions while strengthening the enforcement of customs and VAT obligations.

The agenda also includes the presentation of the 2025 Annual Report of the European Fiscal Board and Commission progress reports on simplification, implementation and enforcement of EU law. The Presidency and the European Commission will brief ministers on the recent G20 Finance Ministers and Central Bank Governors meeting and the IMF Annual Meetings, followed by an exchange of views on international economic coordination.

The next ECOFIN meeting is scheduled to take place in December 2025.

OECD Session on Carbon Taxation & Competitiveness at COP30: 13 November 2025

The OECD will host a session at COP30 on 13 November 2025 (11:30 AM–1:00 PM CET) examining how governments can balance climate, fiscal and economic objectives when taxing energy use or pricing carbon emissions. Drawing on findings from a forthcoming publication, Effective Carbon Rates 2025, the OECD’s flagship analysis of carbon pricing policies across 79 countries, the discussion will explore how fiscal tools are evolving to cut greenhouse gas emissions while maintaining competitiveness, energy security and affordability.

The report highlights a growing diversity and flexibility of approaches as policymakers respond to multiple, interconnected priorities, with emissions trading systems continuing to expand across sectors and jurisdictions. Experts will discuss the trade-offs and synergies among co-existing systems and how to design effective, efficient and fair carbon pricing in an era of rising cost-of-living pressures.

The selection of the remitted material has been prepared by:
Dr. Aleksandar Ivanovski & Brodie McIntosh