Resolution Of Internatiollal Tax Treaty Disputes By Arbitration Settlement Regime

Accompanied by the development trend of regional integration and economic globalization, economic and trade exchanges between the countries are more and more frequent, the number of international tax agreements signed between sovereign states are also increasing. However, between countries there are significant differences in respect of economic development and tax systems, which leads to controversies in the practical application of international tax agreements; and this not only affects the enthusiasm of the foreign investments of multinational tax payers, but also the friendly economic exchanges between the countries, therefore is not conducive to the free flow of the entire international economy.At present, international tax agreement disputes are mainly resolved through mutual consultative procedure between different countries. However, because of the contradictions exist in the program itself; it fails to play fully a role in the process to solve the disputes. Therefore, under the common recommendations of international organizations and scholars, more and more sovereign states have come to expect the operation of arbitration mechanism, which would be compensate for the defects of the mutual agreement procedure, but because of to be unreasonable in some aspects in the system’s design, it isn’t enough to give full play to its value. The author of the thesis tries to make some compensate recommendations by analyzing the arbitration mechanism in the process of being used to resolve international tax treaties dispute, in order to make it more reasonable when acted to settle international tax treaty disputes, and protect the legitimate tax benefits for multinational taxpayers and international economic exchanges.This article is divided into four parts.The first part briefly introduces the controversial concept of international taxation agreements, their types and characteristics and the two procedures to resolve international tax treaty disputes-mutual agreement procedures and arbitration proceedings, and also points out the problems exist in the practical application of the arbitration mechanism.The second part analyses the start-up process of arbitration mechanism and the problems, including the possibility study of using arbitration mechanism in international tax treaty dispute issues, the choice of voluntary arbitration and compulsory arbitration, as well as research about international tax payers’ status. The third part specifically analyses the arbitration mechanism on the procedural requirements, including the selection of arbitrators and the composition of the arbitral court, the application of arbitral law and the effectiveness of arbitration, in order to emphasize the procedural requirements of the arbitration mechanism and to avoid the possible contradictions in the process of its practical operation.The last part discusses about the including of arbitration clause when China signs international tax agreements. By analyzing the necessity and feasibility of the introduction of arbitration clause in the international tax treaties, the author makes some specific recommendations for clause-designing.