Nationality Non-Discrimination under Article 24(1) of the OECD Model: New Frontiers

This chapter seeks to address questions surrounding the application of the “nationality non-discrimination” provision found in most tax treaties. To this end, the analysis focuses on the rules provided for in article 24 of the OECD Model Tax Convention on Income and on Capital and the relevant parts of the OECD Commentary thereof.
As the author has already addressed questions surrounding the application of article 24(1) in an earlier volume of this series, this contribution seeks to analyse later developments in treaty practice, case law and doctrinal analysis with respect to nationality discrimination.
The chapter is divided into five sections. Following this introduction, section 2.2. briefly lays out some recent developments in tax treaty policy relating to non-discrimination. Section 2.3. provides an overview over recent case law concerning the interpretation of article 24(1). Of particular interest is the reception of the most recent – albeit not very recent – changes introduced in the OECD Commentary in 2008 in highest court judgments. Section 2.4. addresses the difficulty of applying article 24(1) to companies and the impact of the new tiebreaker rule introduced in the 2017 version of article 4(3) of the OECD Model. Section 2.5. reintroduces the concept of a combined application of non-discrimination rules for instances of complex discrimination, which has the potential to increase the practical relevance of the nationality non-discrimination rule. Since nationality is rarely if ever the sole basis of a distinction in tax law, this is of particular relevance for article 24(1). Section 2.6. summarizes the results and concludes.