A total 68 countries have signed OECD’s new Multilateral Convention that aims to prevent multinational organisations from “treaty shopping” to take advantage of more favourable tax treaties.

The new convention will update the existing bilateral tax treaty system by transposing results from the BEPS project into bilateral tax treaties to facilitate swift implementation of anti-base erosion and profit shifting measures (BEPS) project, which aims to prevent the artificial movement of a company’s profits to low tax jurisdictions.

It will also include provisions for resolution of treaty disputes through various ways such as mandatory binding arbitration.

All European Union members and the UK have signed the agreement. Other signatories include China, Australia, Singapore, India, Korea, Hong Kong and Indonesia.

At the same time, eight more jurisdiction including Mauritius and Panama have expressed their desire to sign the convention in the future. However, US was the notable absentee among the signatories and those willing to sign.

OECD secretary-general Angel Gurria said: “The signing of this multilateral convention marks a turning point in tax treaty history. We are moving towards rapid implementation of the far-reaching reforms agreed under the BEPS Project in more than 1,100 tax treaties worldwide, and radically transforming the way that tax treaties are modified.

“Beyond saving signatories from the burden of re-negotiating these treaties bilaterally, the new convention will result in more certainty and predictability for businesses, and a better functioning international tax system for the benefit of our citizens.”