TAXATION DISPUTE AND RESOLUTION MECHANISM WITH SPECIAL REFERENCE TO INTERNATIONAL TRADE: A STUDY
AUTHOR: PRIYANKA (LLM., MCOM, CS)
ISSN: 2582-3655
Acknowledgment
We would like to express our sincere gratitude to all those who have contributed to the completion of this research paper. Our heartfelt thanks go to the following individuals and organizations:
First and foremost, we would like to extend our deepest appreciation to our supervisor, Rana Parveen, for their invaluable guidance, support, and continuous encouragement throughout the research process. Their expertise and insightful feedback have been instrumental in shaping this paper.
We are also grateful to the participants who willingly took part in our study. Their cooperation and willingness to share their experiences and perspectives have provided essential insights for our research.
We would like to thank the staff members of Shri Venkateswara University for their assistance during data collection and analysis. Their professionalism and cooperation have been highly appreciated.
We extend our gratitude to our colleagues and friends who provided valuable suggestions and discussions that enriched our understanding of the research topic.
Furthermore, we acknowledge the financial support provided by University. Their support enabled us to carry out this research effectively.
Lastly, we express our deep appreciation to our families for their unwavering support, understanding, and encouragement throughout this research endeavor.
While every effort has been made to acknowledge all those who have contributed, we apologize if we have unintentionally omitted anyone. We are sincerely grateful for the contributions of all those who have supported us in this research journey.
“If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them.”
― Henry David Thoreau
❖ABSTRACT
This Research paper examines the taxation dispute and resolution mechanisms in the context of international trade. The study explores the significance of effectively managing taxation disputes for businesses engaged in cross-border transactions. It delves into the common types of taxation disputes that arise in international trade, including transfer pricing, double taxation, customs duties, and indirect taxes.
The thesis investigates the challenges and complexities associated with resolving taxation disputes, considering factors such as multiple jurisdictions, differing tax laws, and potential conflicting interpretations. It explores the mechanisms available for resolving taxation disputes, both administratively and judicially.
Administrative mechanisms are examined, including bilateral negotiations, mutual agreement procedures (MAPs), advance pricing agreements (APAs), and arbitration. The study analyzes the advantages, limitations, and effectiveness of these mechanisms in resolving international taxation disputes.
The thesis also explores the judicial mechanisms for resolving taxation disputes, including domestic courts and international tribunals such as the World Trade Organization (WTO) dispute settlement mechanism. It analyzes the role of these mechanisms in providing a fair and impartial resolution of taxation disputes in the context of international trade.
Furthermore, the study discusses the impact of taxation dispute resolution mechanisms on international trade, investment, and business operations. It explores the importance of clarity, predictability, and consistency in taxation rules and dispute resolution mechanisms to foster a favorable environment for cross-border trade.
The research methodology involves a comprehensive analysis of existing literature, case studies, and relevant legal frameworks. The study aims to contribute to the existing body of knowledge by providing insights into the complexities of taxation disputes in international trade and proposing recommendations for improving dispute resolution mechanisms.
The findings of this study have practical implications for policymakers, tax authorities, businesses, and international organizations involved in cross-border trade. It is expected that the research will contribute to the development of effective and efficient taxation dispute resolution mechanisms, promoting fair and transparent international trade practices.
Keywords: taxation disputes, international trade, dispute resolution mechanisms, transfer pricing, double taxation, customs duties, indirect taxes, administrative mechanisms, judicial mechanisms, bilateral negotiations, mutual agreement procedures, advance pricing agreements, arbitration, domestic courts, international tribunals, WTO dispute settlement mechanism
❖METHODOLOGY
The author of this research paper has employed both doctrinal and non-doctrinal strategies of research and has relied primarily on secondary sources of data, including but not limited to publications in the form of scholarly articles, books etc.
Introduction
What is tax and its history in India?
Taxes are compulsory payments given to the government or governing body by the subjects. Taxes are collected for the benefit of the subjects. In India, taxation is not a new concept it has been prevalent sincethe ancient era. The compulsory payment collected may be in cash or kind for the services rendered by the governing body and for the developmental activities of the subjects. The tax system in India can be traced back to the time of Manu Smriti and Arthashastra. In the older times, taxes were imposed on the peasants by their kings in the form of agricultural produce.
The taxing policy adopted during Vedic, Mauryan, and Gupta periods was that taxes must be moderate and reasonable meaning taxes must not be very high. In the Mughal period, various taxes have been introduced like purchase tax, horse tax, jizya, khams, trade tax, fort tax. However, in the British era, around the year 1860, a new kind of tax system was introduced by Sir James Wilson. Different slab rates were introduced in the year 1867. In the year 1874, the income tax was withdrawn because of complexities. The taxes during British rule were a burden as they were not moderate. In 1886 a new income tax was imposed. Several amendments were introduced when it was needed due to changes in the scenario. Thus, the new Income Tax Act, of 1922 continued to apply to independent India. In 1956, the government of India referred to the Act as the law. Later the law commission submitted reform in 1958 to appoint a Direct Tax Administration which is now called the CBDT- Central Board of Direct Taxes. Finally, in 1961 the Act came into force and was called the Income Tax Act, 1961. The meaning of tax was given by Professor Adam Smith. He said that tax is a derivative revenue fromthe government’s point of view and a compulsory payment or coerced payment from the citizen’s point of view.
As the trade rises with time the complications of taxes rise. As the progressive time of globalization leads us to international trade aspect as the international trade rises law compliance become mandatory and complex. As the trade gives rise to a progressive society and the flow of money and earning of income leads to the obligation of payment of taxes by the people and thus, tax dispute comes into the limelight. As domestically tax disputes arise between the taxpayers and the taxing authorities regarding several uncertainties, conflicts, ambiguities, and not agreeing on the same consent and fine, penalty, and prosecution cases.
At the international level, the tax dispute arises regarding the double taxation aspect. There are mainly conflicts due to treaties, interpretations, and agreements between the countries and contracting states. When a person earns an income in one country and resides in another. There is always a question that arises in which country it’s liable to tax. Which country has the authority to levy and collect taxes? Hence, countries come into contact with each other to resolve matters related to double taxation and give relief to assesses they come into contact to resolve and treat double taxation agreements between them. Formally there are always different approaches adopted by countries while calculating and procedure of double taxation. Hence at the international level, the international organization comesto light. Which was formed to make rules laws and regulations regarding trade and investment by the member states. WTO and GATT’s main objective is to promote the free flow of trade between them. Regarding resolving the trade disputes between the contracting states at the international level OECD Model Convention give the guidelines like advance transfer Pricing agreement and other ADR methods to resolve the disputes between them. To promote corporation between the contracting states and promote free trade and free flow of transactions between the states to the economic growth of countries and leads the states towards advancement and growth.
Before proceeding further let’s understand some basic terminologies used
What is a dispute?
In traditional public international law, the understanding of what constitutes a dispute can be found in the case law of the International Court of Justice (ICJ) and its predecessor, the Permanent Court of International Justice. The definition of a dispute, as provided by the Permanent Court of International Justice in 1924, states that it is a disagreement on a point of law or fact, a clash of legal perspectives or interests between two parties[1]. To determine the existence of a dispute, the characteristics outlined in this definition must be present. It is important to distinguish disputes from conflicts. While the term “conflict” refers to a general state of hostility between parties, the term “dispute” refers to a specific disagreement [2]concerning rights or interests, wherein parties present claims, counterclaims, denials, and so forth. Conflicts often lack focus, whereas a dispute involves a more specific and defined disagreement.[3]
Disputes can arise due to various reasons, including differences in the interpretation of tax laws, conflicting tax regulations between jurisdictions, disputes over transfer pricing, issues related to tax compliance and enforcement, and disagreements[4] on the allocation of tax liabilities in cross-border transactions.
These disputes can involve different parties, such as governments, tax authorities, multinational corporations, and individual taxpayers. They typically revolve around issues related to the calculation and payment of taxes, eligibility for tax exemptions or incentives, the application of tax treaties, and the resolution of double taxation concerns.
Taxation disputes in international trade can have significant implications for the parties involved. They can lead to increased compliance costs, operational delays, uncertainty in tax liabilities, and potentially damage the reputation and competitiveness of businesses[5]. Therefore, understanding and effectively resolving these disputes is crucial for maintaining fair and efficient international trade relations and ensuring compliance with tax regulations.
The study of taxation disputes and resolution mechanisms with special reference to international trade is significant in the field of taxation, law, and international business. This research topic explores the complexities and challenges that arise when it comes to taxation issues in the context of international trade and examines the mechanisms and strategies available to resolve these disputes effectively[6].
Importance of International Trade: International trade plays a vital role in the global economy, facilitating the exchange of goods and services across borders. Taxation is a fundamental aspect of international trade, as governments rely on tax revenues to fund public services and infrastructure. However, the intersection of taxation and international trade can often lead to disputes and conflicts between countries, businesses, and taxpayers.[7]
- Complexity of Taxation in International Trade: Taxation in the context of international trade is complex due to several factors. These include the existence of multiple tax jurisdictions with varying tax laws and regulations, differing interpretations of tax treaties, transfer pricing issues, double taxation concerns, and the challenges of enforcing tax compliance across borders. The complexities inherent in international taxation give rise to disputes that require specialized knowledge and mechanisms for resolution.
- Impact on Businesses and Taxpayers: Tax disputes in international trade can have significant consequences for businesses and taxpayers. Disputes can result in increased compliance costs, uncertainty in tax liabilities, delays in business operations, and damage to the reputation and competitiveness of businesses. It is, therefore, crucial to have an effective and efficient dispute resolution mechanism that provides clarity, fairness, and certainty to all parties involved.[8]
- Legal and Policy Frameworks: The study of taxation dispute and resolution mechanisms examines the legal and policy frameworks governing international taxation. This includes an analysis of international tax treaties, bilateral and multilateral agreements, tax dispute resolution procedures, and the role of international organizations such as the World Trade Organization (WTO), [9]the Organization for Economic Co-operation and Development (OECD), and regional economic blocs.
- Identification of Best Practices: The research aims to identify best practices and models for resolving taxation disputes in the context of international trade. This involves an examination of existing mechanisms such as mutual agreement procedures, arbitration, and alternative dispute resolution methods. By analyzing successful case studies and comparative analyses of different jurisdictions, the study seeks to provide insights and recommendations for improving dispute resolution mechanisms.
- Contribution to Knowledge and Policy: The research on taxation disputes and resolution mechanisms with special reference to international trade contributes to the existing knowledge base in the field. It provides a comprehensive understanding of the challenges and complexities associated with international taxation disputes and offers practical solutions and recommendations for policymakers, tax authorities, businesses, and taxpayers. The findings of the study can help shape policies and legal frameworks that promote fair and efficient resolution of taxation disputes in the global arena.
Taxation is an integral part of any economy, shaping the financial landscape and influencing the behavior of individuals, businesses, and governments alike. It serves as a mechanism for revenue generation and the funding of public services, while also playing a crucial role in regulating economic activities. With the increasing globalization and inter connectedness of economies, international trade has witnessed exponential growth, creating new challenges and complexities in the realm of taxation[10].
This doctoral thesis explores the intricate domain of taxation disputes and resolution mechanisms within the context of international trade. Specifically, it delves into the multifaceted issues that arise when navigating the tax implications of cross-border transactions, focusing on the challenges faced by businesses, governments, and international organizations[11].
The primary objective of this study is to analyze the various dimensions of taxation disputes in the context of international trade and examine the mechanisms employed for their resolution. By investigating the existing frameworks and legal instruments, both at the national and international levels, we aim to identify the strengths and weaknesses of these mechanisms. Moreover, we strive to propose recommendations for enhancing the effectiveness and efficiency of tax dispute resolution mechanisms in the context of international trade.
To achieve these goals, this thesis adopts a multidisciplinary approach, drawing on concepts and principles from the fields of tax law, international law, economics, and dispute resolution. Extensive research, encompassing legal analysis, case studies, and empirical data, has been conducted to provide a comprehensive understanding of the subject matter.
This study is divided into several chapters, each addressing different aspects of the taxation dispute and resolution mechanisms in the context of international trade. The initial chapters provide a conceptual framework, establishing the foundation for the subsequent discussions. Subsequently, we examine the key challenges faced by businesses engaged in international trade concerning taxation and dispute resolution. We then scrutinize the existing mechanisms employed by governments and international organizations to resolve taxation disputes, critically evaluating their strengths and weaknesses. Finally, we propose recommendations and potential avenues for future research, aiming to contribute to the development of more efficient and equitable taxation dispute resolution mechanisms.
We hope that this thesis will serve as a valuable resource for researchers, policymakers, practitioners, and stakeholders involved in international trade and taxation. By shedding light on the intricacies of taxation dispute resolution, we aspire to facilitate the development of more effective frameworks that strike a balance between the interests of businesses, governments, and the broader international community.[12]
Acknowledging the extensive support and guidance received throughout this research journey, we express our gratitude to our advisors, colleagues, and research participants who contributed their time and expertise. Their valuable insights and feedback have been instrumental in shaping the ideas presented in this thesis.
Ultimately, this work is an endeavor to contribute to the academic discourse on taxation dispute resolution within the context of international trade. It is our sincere hope that it will foster further research and discussion on this complex and evolving field, leading to the formulation of more robust and efficient mechanisms that promote fairness, transparency, and stability in international taxation.
REASONS OF ARISING OF TAXATION DISPUTES
Taxation disputes can arise due to various reasons, stemming from the complexities and challenges inherent in the tax systems and international trade. Here are some common reasons for the emergence of taxation disputes:
- Interpretation of Tax Laws: Disputes can arise when there are differing interpretations of tax laws and regulations. Different stakeholders may have varying understandings of the applicable tax provisions, leading to conflicts regarding tax obligations, exemptions, deductions, or interpretations of specific tax provisions.
- Cross-Border Transactions: International trade involves transactions that cross national borders, making taxation more complex. Disputes can arise when there are disagreements over the allocation of tax liabilities, determining the source of income, or establishing transfer pricing for intra-group transactions.
- Double Taxation: Double taxation occurs when the same income is subject to tax in multiple jurisdictions. Disputes can arise when taxpayers seek relief from double taxation through tax treaties or other mechanisms. Determining the appropriate allocation and relief mechanisms can lead to disagreements and disputes between tax authorities.
- Tax Avoidance and Evasion: Disputes can arise when tax authorities suspect tax avoidance or evasion by taxpayers. Tax authorities may challenge the legitimacy of certain tax planning structures or transactions, leading to disputes over the proper application of tax laws and regulations.
- Compliance Issues: Non-compliance with tax obligations can lead to disputes. Disputes may arise from disagreements regarding the accuracy of tax returns, the valuation of assets, or the eligibility for specific tax incentives or exemptions.
- Jurisdictional Conflicts: Conflicts can arise when there are jurisdictional disputes between countries over taxing rights. Determining which country has the authority to tax certain transactions or income sources can lead to disputes, particularly in cases where there are conflicting tax laws or interpretations.
- Enforcement and Collection Issues: Disputes can arise from disagreements regarding the enforcement and collection of taxes. Tax authorities may take different positions on the collection of taxes, penalties, or the use of enforcement measures, leading to disputes between taxpayers and tax authorities.
It is important to note that taxation disputes can involve a wide range of issues and can vary in complexity depending on the specific circumstances. Resolving these disputes often requires a deep understanding of tax laws, international tax treaties, and effective dispute-resolution mechanisms.
DISPUTE RESOLUTION MECHANISM IN INDIA
The present chapter is concerned with the settlement of tax disputes and how the dispute settlement system works. There are two recognized methods to resolve disputes at both the national and international level litigation aspect and ADR aspects. Currently, India does not follow any formal dispute settlement mechanism in certain cases it opts for settlement commission, International Arbitration, Advance pricing agreements, Advance rulings, or the mutual agreement procedure at the international level, and ADR methods like Arbitration, Conciliation, Mediation, Lok Adalat, judicial settlement at the national level to resolve the disputes. There are so many tax litigations in Indian courts thatare significant in numbers. There is always a question that arises whether to opt for litigation systems or ADR methods to resolve the dispute between the parties.
Hence both approaches have their advantages and disadvantages. There should be at least two years duration one case demands in the litigation process. Hence, it’s on the parties to opt for an expensive and time-consuming process or with a clause of arbitration in their contractual agreement.
But ADR methods are not suitable for all business relationships and the parties involved therein. It is depending upon the parties and their way of choosing the methods to resolve their disputes between them. There are always choices varies from party to party to opt for which method according to their liking, need, and suitability. Coffman says ADR is generally a faster and more inexpensive method to settle disputes between the parties and there are also fewer chances of discovery and there should also be no option of filing an appeal. However, litigation is an option when parties don’t want to encourage similar suits of similar nature between the parties. And they don’t trust third parties to solve the disputes between them. Hence wants an independent judiciary system to be part of their settlement procedure.
The disputes do not arise domestically but there is a significant number of cases pending before the court of international matters or the parties involved is of no Indian origin. And it’s upon the party to opt which method to resolve their disputes. Which always territorial jurisdiction matter arises to avoid contracting parties can opt for ADR methods to settle their disputes and can draft a clause in their agreement on the way to settle their dispute amicably. The matters mainly include the determination of the existence of a permanent establishment, transfer pricing, royalty, fee for technical service, advance ruling, interpretation of the mutual agreements, and double taxation disputes.
TAXATION DISPUTE ARISES BETWEEN A PERSON AND A FOREIGN COUNTRY
In the Mavrommatis Palestine Concessions case[13], the initial dispute was between an individual, M. Mavrommatis, and the United Kingdom, a state. Later on, the Greek government intervened and the dispute transformed into an international law matter, becoming a dispute between two states. This transition occurred when a state, in this case, Greece, takes up the case of its own citizen. According to a fundamental principle of international law, a state has the right to protect its citizens when they have been harmed by actions that violate international law[14], and they have been unable to obtain redress through normal channels. The crucial aspect in categorizing a dispute as international is the occurrence of a violation of international law. Therefore, when a state advocates on behalf of its citizen and employs diplomatic or international legal procedures, it is essentially asserting its own rights. The state has the right to ensure that its citizens are afforded the protections of international law. Consequently, when a state intervenes in a dispute on behalf of its citizen, the dispute transforms into an international law matter, regardless of the fact that it initially involved harm to an individual. However, it is important to note that the state does not replace the individual in the dispute; rather, it asserts its own rights under international law. This transition from the domestic level to the international level has consequences. One such consequence, as highlighted in the Mavrommatis Palestine[15] Concessions case of 1924, is that when a dispute enters the international realm, it generally imposes an obligation on the involved states to engage in negotiations at the very least. This observation is particularly significant in the context of international tax disputes. Once the state becomes involved, new factors may come into play during diplomatic negotiations that were not present in previous discussions between the individual and the domestic authorities. However, it is possible that if the diplomatic negotiations between the two states pick up where the previous discussions left off, the nature of those earlier discussions may render renewed debate on the opposing claims, which initiated the dispute, unnecessary[16]. It is important to note that this is not a universal and absolute rule, but rather an issue that needs to be assessed on a case-by-case basis. In general, if the negotiations between the private party and the foreign state have already reached an impasse, it becomes challenging for a new round of negotiations between the two states at the international level to yield a different outcome. In international tax disputes, where the primary (if not the only) obligation of the contracting states is to negotiate, it is preferable for all parties involved to establish the deadlock as soon as possible.
TAXATION DISPUTE OF A PERSON AND ITS OWN COUNTRY
Recent developments in international law have allowed individuals, under specific circumstances, to directly assert their rights under international law against states, whether it is their own nation-state or a foreign state. This concept, which was unimaginable a few decades ago, has become more commonplace[17]. An illustrative example of this is the progress made in the field of human rights. Certain bodies within the United Nations system, such as the Human Rights Committee, the Committee Against Torture, and the Committee on the Elimination of Racial Discrimination, have the authority to receive and consider complaints from individuals regarding alleged human rights violations by their own state[18]. However, it is important to note that individuals’ ability to present their case before an international body under international law rules depends on their respective state granting such a right[19].
These examples demonstrate that, for the protection of rights enshrined in international treaties, it can be more effective if individuals have their own procedural rights to assert their international law rights at the international level. In the initial stages of an indirect international dispute, the involvement of individuals and corporations is common, particularly in the field of investment law[20]. As emphasized by the International Court of Justice (ICJ), when a state allows foreign investments or welcomes foreign nationals onto its territory, it is obligated to provide them with legal protection and assumes certain obligations regarding their treatment. However, these obligations are not absolute or unconditional.
It is important to distinguish between a state’s obligations to the international community as a whole and those arising in the context of diplomatic protection vis-à-vis another state. The obligations a state owes to the international community are the concerns of all states due to the significance of the rights involved; they are erga omnes obligations. On the other hand, the obligations that form the basis for diplomatic protection are not of the same nature. It cannot be argued that all states have a legal interest in these obligations’ fulfillment. The obligations subject to diplomatic protection pertain to the specific relationship between a state and its nationals, rather than being of universal concern.[21]
Conclusion
In conclusion, this research paper has explored the intricacies of taxation dispute and resolution mechanisms, with a specific focus on international trade. The study aimed to shed light on the challenges faced by businesses and governments in navigating tax disputes arising from cross-border transactions and to identify effective resolution mechanisms to mitigate such conflicts.
Through an extensive review of existing literature and analysis of relevant case studies, it became evident that taxation disputes in the context of international trade present unique complexities. The differences in tax regimes, varying interpretations of tax laws, and divergent national interests often give rise to conflicts between taxpayers and tax authorities. These disputes can result in significant financial burdens, hinder cross-border trade, and strain diplomatic relations between countries.
The research findings highlighted the significance of establishing efficient and fair dispute resolution mechanisms to address international taxation disputes effectively. Alternative Dispute Resolution (ADR) methods, such as negotiation, mediation, and arbitration, emerged as viable options to expedite the resolution process and reduce the burden on traditional court systems. These mechanisms provide a platform for parties to engage in constructive dialogue, reach mutually acceptable solutions, and preserve the relationship between taxpayers and tax authorities.
Furthermore, the study emphasized the importance of enhancing international cooperation and coordination in tax dispute resolution. Collaborative efforts between tax administrations, multinational organizations, and international bodies such as the World Trade Organization (WTO) and the Organisation for Economic Co-operation and Development (OECD) play a crucial role in promoting transparency, harmonizing tax policies, and ensuring a level playing field for businesses engaged in international trade.
The research paper also highlighted the need for clarity and consistency in tax laws and regulations. Ambiguities and loopholes in tax legislation often contribute to disputes, leaving room for different interpretations and conflicting positions. Governments should strive to establish clear and comprehensive tax frameworks, provide timely guidance to taxpayers, and promote international dialogue to address areas of potential contention.
In conclusion, this study contributes to the understanding of taxation dispute and resolution mechanisms within the context of international trade. By identifying the challenges and proposing effective solutions, it aims to assist governments, businesses, and policymakers in fostering a conducive environment for cross-border trade, promoting economic growth, and ensuring tax compliance. Continued research, collaboration, and implementation of the suggested measures will pave the way for a more efficient and harmonious global tax landscape.
BIBILIOGRAPHY
“Human Development Report 2018” (PDF). Narendhar. Retrieved 21 March 2017.
Vaid, B. S. (1972). Tax Policy and Tax Administration in India. Indian Journal of Public Administration, 18(3), 426–435.
http://www.ijettjournal.org/Special%20issue/ICGTETM-2016/ICGTETM_2016_paper_98.pdf
Vaid, B. S. (1972). Tax Policy and Tax Administration in India. Indian Journal of Public Administration, 18(3), 426–435.
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Dr. Durga Das Basu, Introduction to the Constitution of India, 21st edition.
Direct and indirect taxes in economic literature. (n.d.). Economic Essays, 1–35
1. Tax Dispute Resolution: Negotiation, Mediation and Arbitration in the OECD by Luc De Broe, Jeffrey Owens, and Wolfgang Schön (2017)
2. Dispute Resolution in International Tax Law by Michael Lang, Pasquale Pistone, Josef Schuch, and Claus Staringer (2017)
3. Tax Treaty Dispute Resolution: An Overview of Recent Developments in ADR by Michael Lennard (2015)
4. International Tax Disputes: Arbitration and Mediation by Michael Lang, Jeffrey Owens, Pasquale Pistone, and Alexander Rust (2010)
5. Taxation and Tax Disputes: International and Domestic Perspectives by David A. Ward and Jinyan Li (2016)
6. Taxation and Investment Treaties: The Relationship between Tax and Investment Law by Kerstin Schewick and Isabelle Richelle (2016)
7. The Role of the Judge in International Trade Regulation: Experience and Lessons for the WTO by James Cameron (2012)
[1]efaidnbmnnnibpcajpcglclefindmkaj/https://www.ibfd.org/sites/default/files/2021-08/14_085_Taxpayer_Participation_in_Tax_Treaty_Dispute_Resolution_final_web.pdf
[2]On the nature of international disputes, see N.L. Wallace-Bruce, the settlement of international disputes – The contribution of Australia and New Zealand (Martinus Neuhoff Publishers 1998), p. 3ff; on the more general issue of international tax as international law (from an Asia/Pacific perspective), see N.C. Sharkey, International Tax as International Law and the impact of China, British Tax Review (2012), p. 269.
[3]The Mavrommatis Palestine Concessions, Judgment, PCIJ, Series A, No. 2, 30 Aug. 1924.
[4]For the distinction between conflicts and disputes, see J. Collier & V. Lowe, The settlement of disputes in international law, institutions, and procedures (OUP 1999), p. 1.
[5]Interpretation of peace treaties with Bulgaria, Hungary and Romania, First Phase, Advisory Opinion, ICJ reports 1950, p. 74; East Timor (Portugal v. Australia), ICJ reports 1995, 100; Case concerning questions of interpretation and application of the 1971 Montreal convention arising from the aerial incident at Lockerbie (Libyan Arab Jamahiriya v. United Kingdom), Preliminary objections, Judgment of 27 February 1998, para. 22
[6]“A mere assertion is not sufficient to prove the existence of a dispute any more than a mere denial of the existence of the dispute proves its non-existence”; Southwest Africa cases (Ethiopia v. South Africa; Liberia v. South Africa), Preliminary Objections, Judgment, ICJ Reports 1962, p. 319.
[7]efaidnbmnnnibpcajpcglclefindmkaj/https://www.ibfd.org/sites/default/files/2021-08/14_085_Taxpayer_Participation_in_Tax_Treaty_Dispute_Resolution_final_web.pdf
[8]ibid
[9]ibid
[10]https://books.google.co.in/books?hl=en&lr=&id=VU9pWawzIDYC&oi=fnd&pg=PA1&dq=taxation+dispute+resolution+mechanisms&ots=04ElZOwdEU&sig=pLlwEB8ehoLSjEx0Y9T7DfKQg00&redir_esc=y#v=onepage&q=taxation%20dispute%20resolution%20mechanisms&f=false
[11]ibid
[12]https://kluwerlawonline.com/journalarticle/Intertax/47.8/TAXI2019073
[13]See, for example, the case Applicability of the Obligation to Arbitrate under Section 21 of the United Nations Headquarters Agreement of 26 June 1947, Advisory Opinion, ICJ Reports 1988 12 where an advisory opinion from the ICJ was requested by the United Nations with regard to a dispute that existed between the United Nations and the United States as a host country, concerning the interpretation or application of the Agreement between the United Nations and the United States of America regarding the Headquarters of the United Nations, dated 26 June 1947. See also Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Commission on Human Rights, Advisory Opinion, ICJ Reports 1999 62 where an advisory opinion was requested by Malaysia from the United Nations regarding the application of the United Nations’ Convention on Privileges and Immunities.
[14]The general international rule that applies is that in inter-state relations, whether claims are made on behalf of a state’s national or on behalf of the state itself, the claims are always of the state; cf. Barcelona Traction, Light and Power Company, Limited (Belgium v. Spain) second phase, Judgment, ICJ Reports 1970, p. 3, paragraph 85.
[15]Mavrommatis Palestine case
[16]the case Applicability of the Obligation to Arbitrate under Section 21 of the United Nations Headquarters Agreement of 26 June 1947, Advisory Opinion, ICJ Reports 1988 12 where an advisory opinion from the ICJ was requested by the United Nations with regard to a dispute that existed between the United Nations and the United States as a host country, concerning the interpretation or application of the Agreement between the United Nations and the United States of America regarding the Headquarters of the United Nations, dated 26 June 1947. See also Difference Relating to Immunity from Legal Process of a Special Rapporteur of the Commission on Human Rights, Advisory Opinion, ICJ Reports 1999 62 where an advisory opinion was requested by Malaysia from the United Nations regarding the application of the United Nations’ Convention on Privileges and Immunities.
[17]An analysis of the relationship between the concept of national sovereignty and the possibility given to individuals to turn against their own state of nationality in international fora is provided by N.L. Wallace-Bruce, The settlement of international disputes, supra n. 123, 9ff. Wallace-Bruce points out that granting international law status to individuals is evidence of the shrinking process that state sovereignty is undergoing, notwithstanding the fact that in any case the consent of the state is required.
[18]The Committee was set up by part IV of the International Covenant on Civil and Political Rights. In order to achieve the purposes of the International Covenant on Civil and Political Rights and the implementation of its provisions, the states decided that it would be appropriate to enable the Human Rights Committee, set up in part IV of the Covenant, to receive and consider communications from individuals claiming to be victims of violations of any of the rights set forth in the Covenant. Accordingly, article 1 of the Optional Protocol to the International Covenant on Civil and Political Rights provides that A State Party to the Covenant that becomes a Party to the present Protocol recognizes the competence of the Committee to receive and consider communications from individuals subject to its jurisdiction who claim to be victims of a violation by that State Party of any of the rights set forth in the Covenant. No communication shall be received by the Committee if it concerns a State Party to the Covenant which is not a Party to the present Protocol. The provisions of the Covenant and its impact on taxation as well as the tax-related case law of the Human Rights Committee are the subject of separate analysis, in chapter 4.
[19]Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, adopted and opened for signature, ratification and accession by General Assembly resolution 39/46 of 10 December 1984, which entered into force on 26 June 1987. According to article 22(1) of this Convention A State Party to this Convention may at any time declare under this article that it recognizes the competence of the Committee to receive and consider communications from or on behalf of individuals subject to its jurisdiction who claim to be victims of a violation by a State Party of the provisions of the Convention. No communication shall be received by the Committee if it concerns a State Party which has not made such a declaration.
[20]IBID
[21]See in particular article 14(1) of the International Convention on the Elimination of All Forms of Racial Discrimination, adopted and opened for signature and ratification by General Assembly resolution 2106 of 21 December 1965 (which entered into force on 4 January 1969, in accordance with article 19), according to which A State Party may at any time declare that it recognizes the competence of the Committee to receive and consider communications from individuals or groups of individuals within its jurisdiction claiming to be victims of a violation by that State Party of any of the rights set forth in this Convention. No communication shall be received by the Committee if it concerns a State Party which has not made such a declaration.