A multilateral negotiation can overcome the hurdle of cumbersome
bilateral negotiations and produce important efficiency gains. Given
the decades-long process for bilateral treaty negotiations, a multilateral
instrument represents the only way to address treaty-based BEPS concerns
in a swift and co-ordinated manner. The current network of bilateral treaties
involves substantial complexity because each treaty is a legally distinct
instrument, and its relationship to other bilateral treaties is undefined.
As a result, lawyers, tax administrators, and courts spend a lot of energy
interpreting each individual treaty, especially when treaties differ in small
ways.