Updates from the Third Session of the historic Intergovernmental Negotiating Committee (INC) on the United Nations Framework Convention on International Tax Cooperation

14 Nov 2025

UN Tax Convention Group Photo

Day 1 – Monday, 10 November 2025, Nairobi, Kenya

Day 1 of the Third Session of the Intergovernmental Negotiating Committee (INC) on the United Nations Framework Convention on International Tax Cooperation (UNFCITC) opened with the Co-Chair, Daniel Nuer, outlining the progress made by Workstream 1 on the Framework Convention. He presented the proposed articles of the template for the Convention and noted that the first part of this Session would focus on the commitments set out in the Terms of Reference for a UNFCITC. He then invited delegations to begin discussions on the proposed articles related to commitments.

Article 4: Fair Allocation of Taxing Rights

The negotiations started with a discussion on Article 4. The proposed text reads as follows:

The States Parties agree that every jurisdiction where a taxpayer conducts business activities, including jurisdictions where value is created, markets are located and revenues are generated, has a right to tax the income generated from such business activities.

The discussions focused on whether the factors for allocating taxing rights proposed in Article 4 were sufficient to grant taxing rights to both source and residence countries.

Speaking on behalf of the Africa Group (AG), Kenya expressed support for the draft article, emphasising that it recognises both supply-side and demand-side contributions to value creation, and therefore appropriately balances the roles of residence and source states. Kenya noted that it was particularly pleased with the explicit inclusion of factors reflecting the contribution of market jurisdictions, which have traditionally been excluded from international tax allocation rules.

Kenya further noted that achieving a fair allocation of taxing rights requires recognising a broad set of factors that would allow income to be taxed when those factors are present. Kenya expressed concern that the current draft elevates the conduct of business activities as the primary determinant of taxing rights, whereas it should instead be one factor among several.

In this regard, Kenya proposed specifying a clear list of factors that would determine whether a state has the right to tax income arising within its jurisdiction. These include the location of economic activity, where value is created, and where revenues are generated. Kenya also emphasised that once income is attributable to a particular country, the article should explicitly outline the taxing rights of that jurisdiction.

Speaking on behalf of the Africa Group, Kenya therefore proposed the following wording for Article 4 to ensure that all relevant factors are adequately recognised:

The States Parties agree that each jurisdiction where value is created, markets are located, or revenues are generated has the right to tax the income related to or derived from it.

The question of ‘business activity’ versus ‘economic activity’

One of the key issues raised under Article 4 was the use of the term “business activities.” Several African countries proposed removing this term from the article.

Sierra Leone, Nigeria, and Zambia supported Kenya’s statement on behalf of the Africa Group. Nigeria emphasised that references to business or economic activities should not, in themselves, be regarded as value creation, and that revenue generated is the key factor for taxation under this article. Zambia agreed that the term “business activities” is too vague and further proposed replacing the word “and” with “or” in Article 4 so that the revised wording would read:

'Where value is created, markets are generated [or] where revenues are generated…’

Côte d’Ivoire supported Nigeria’s position, emphasising that the term “economic activity” is too ambiguous and that it would be risky to introduce terms whose content and scope are uncertain.

The African Tax Administration Forum (ATAF) aligned with the comments made by Kenya and the African Union, supporting the removal of the term “business activities” and favouring a direct reference to value creation and revenue generation as sufficient. ATAF also cautioned against including a second paragraph in Article 4 if it relates to double taxation agreements (DTAs), stressing that member states should ensure that Article 4 is future-proof for the development of future protocols.

Equal weight for key factors under Article 4 and the impact on double tax relief

Several member states expressed concern that Article 4 could adversely affect the taxing rights of residence states. Some also argued that the article might result in double or multiple taxation.

Nigeria, aligning with Kenya’s statement on behalf of the Africa Group, asserted that Article 4 proposes a balanced approach by addressing both residence and source jurisdictions. Nigeria argued that residence states already have broad rights to tax their residents on their worldwide income; therefore, there is no need for an additional provision on double tax relief in Article 4, as residence states can provide such relief unilaterally. Zambia and Côte d’Ivoire shared this stance, maintaining that Article 4 does not infringe on the taxing rights of residence countries and that double tax relief does not need to be addressed in this article, since it can be handled by residence states through their own systems.

Lesotho aligned with Kenya’s statement on behalf of the Africa Group. It noted that there had been unfairness in the allocation of taxing rights in the past and reminded member states that the core problem was that many countries have not been able to tax what they should have been able to tax in the first place. The allocation keys in Article 4 are therefore intended to promote fairness by giving member states a clearer right to tax.

At the same time, Lesotho cautioned that establishing a hierarchy among the allocation keys could infringe on states’ sovereign right to tax. Prioritising one factor over others, it argued, could jeopardise tax sovereignty—precisely what Article 4 seeks to address.

Responding to concerns from some member states about the need for an “economic analysis” proposal, Lesotho requested clarification on what this would entail and what kind of analysis would be required in cases where taxing rights are reallocated. Lesotho supported the wording proposed by Kenya on behalf of the Africa Group for Article 4 and reiterated that DTAs can be addressed in other provisions aimed at minimising double taxation, rather than in this specific article on the fair allocation of taxing rights.

Kenya, speaking in its national capacity, highlighted that the factors included in Article 4 can be met by both source and residence states. It submitted that any reference to residence would require a corresponding reference to source. Kenya further argued that there should be no hierarchy among the factors of value creation, economic activity, and revenue generation, as this would conflict with the purpose of Article 4 and perpetuate the imbalance that led to these negotiations in the first place.

Kenya suggested that concerns relating to double taxation and DTAs should be addressed in Article 12, noting that Article 4 goes beyond the traditional scope of double tax agreements.

Rwanda aligned with the Africa Group and supported the amendments proposed by Kenya, particularly the replacement of the word “taxpayer” with “jurisdiction.” Rwanda stressed that the factors in Article 4 should carry equal weight and that any jurisdiction meeting these factors should have the right to tax. It also considered it appropriate to replace the word “and” with “or” in Article 4, as proposed by Kenya on behalf of the Africa Group.

On DTAs, Rwanda suggested that countries can manage double taxation relief through their domestic tax systems and that there is therefore no need to introduce a new paragraph on relief from double taxation in Article 4. Under the Framework Convention, DTAs should instead be addressed through protocols or other articles.

Morocco supported Kenya’s proposal on behalf of the Africa Group. It noted that the proposal makes clear that the fair allocation of taxing rights encompasses both source- and residence-based states. Morocco also considered that there was no need to refer to DTAs in Article 4, as these can be addressed in other provisions.

In conclusion, the African Union expressed its appreciation for the work of the INC and aligned itself with the Africa Group, emphasising that Article 4 should not be read in isolation. Instead, Article 4 should be interpreted in light of the Convention’s overall principles, with its implications for other matters, such as DTAs, addressed in other articles. On this basis, the AU did not support the proposal to introduce a separate paragraph on relief from double taxation into Article 4.

Responding to China’s comment that Article 4 lacks detail, the AU explained that the article is intentionally drafted in high-level language to allow member states to develop more substantive rules over time. It noted that related instruments, such as Protocol 1, can provide additional “safety nets” and are underpinned by the principle of fair allocation of taxing rights. The AU stressed that specific technical details should not be incorporated into the overarching Convention itself. It further recalled that residence states can activate the triggers for taxing rights listed in Article 4 and that they retain broad rights to tax their residents, enabling them to exercise these rights effectively.

In the afternoon session, the INC turned to Article 5, which addresses the taxation of high-net-worth individuals (HNWIs).

Taxation of High-Net-Worth Individuals (HNWIs)

The proposed Article 5 on the taxation of high-net-worth individuals reads as follows:

1. In order to prevent high-net worth individuals from avoiding or evading taxes, the States Parties agree to adopt measures to detect and thwart such activities, including through expanding exchange of information to additional types of assets and instruments as such exchange becomes feasible.

2. The States Parties agree to share information regarding structures and techniques used by high-net worth individuals to avoid and evade taxes and to require appropriate disclosures of such structures and techniques by taxpayers, advisors and intermediaries involved in developing them.

3. The States Parties agree to adopt coordinated approaches to ensuring effective taxation of high-net worth individuals.

Côte d’Ivoire stated that, from its perspective, the taxation of HNWIs is primarily a domestic matter to be addressed through national tax systems. It also noted that there is no clear, agreed definition of what constitutes a high-net-worth individual and questioned whether all member states regard HNWIs as a priority concern. Côte d’Ivoire observed that the draft article largely refers to exchange of information (EOI) and queried whether the EOI requirements specific to HNWIs differ from those already applicable to other taxes. It proposed strengthening commitments by parties and, where appropriate, harmonising national approaches to the taxation of HNWIs, while cautioning against duplicating commitments that already appear in other articles, such as those on EOI.

The meeting adjourned at 6 p.m., with the intention of continuing discussions on the articles of the Framework Convention in line with the INC programme of work.

Day 2 – Tuesday, 11 November 2025, Nairobi, Kenya

The second day opened with the continuation of discussions on Article 5, which addresses the taxation of high-net-worth individuals (HNWIs).

Strengthening international tax rules for taxation of HNWIs

Zambia, speaking on behalf of the AG proposed deleting the phrase “as such exchange becomes feasible.” It argued that the timing and feasibility of expanding exchange of information should not be predetermined at this stage of the negotiations.

The paragraph in question reads:

Nigeria stated that it found the provisions in Article 5 workable and would support the language agreed on the floor.

Lesotho addressed concerns from some Member States that Article 5 interferes with their tax sovereignty. It aligned with the Africa Group, emphasising that Article 5 does not allocate taxing rights and therefore does not affect Member States’ sovereign powers to tax HNWIs. Rather, it facilitates cooperation necessary to enforce domestic laws.

In response to suggestions that an article of taxation of HNWIs is not necessary, Lesotho highlighted that the ToRs and Resolution 79/235 mandated the INC to develop a commitment on this topic and therefore its inclusion is not open for debate.

Sierra Leone aligned with the Africa Group and expressed its support for Article 5. It recommended amending paragraph 1, by deleting the phrase "such exchange becomes feasible.”

Cote d'Ivoire aligned with the Africa Group, noting that Article 5 was balanced and aligned with the Terms of Reference. It stressed the need for a specific commitment on HNWIs, given their distinct tax avoidance risks. It agreed with the Africa Group's proposal to remove the word "feasible" as it may create ambiguity.

ATAF reiterated the importance of the taxation of HNWIs also noting that the issue was explicitly required in the ToRs. It, therefore, supported removing the phrase “as such exchange becomes feasible.”

The African Union (AU) similarly supported the deletion of the phrase “as such exchange becomes feasible" noting that it weakened the article.

Tanzania expressed support for Article 5 highlighting the importance of clear commitments to address tax avoidance, tax evasion and illicit financial flows. It supported the deletion of the phrase “as such exchange becomes feasible” because its inclusion would dilute the strength of the convention and undermine implementation. On the issue of complementarity, Tanzania emphasised that the convention should not be subordinate to existing frameworks, but should stand as a central, inclusive, and intergovernmental platform for tax cooperation.

Article 6 Mutual Administrative Assistance

Following the conclusion of discussions on Article 5, the INC proceeded to Article 6 on Mutual Administrative Assistance (MAA). Article 6 reads as follows:

1. The States Parties recognize that domestic resource mobilization depends on the ability of all States to enforce their domestic tax laws. Accordingly, States Parties shall afford one another the widest measure of mutual administrative assistance (including through exchange of information for tax purposes), to support the administration or enforcement of the domestic laws regarding taxes of every kind and description by another State Party. Such administrative assistance will include the exchange of information regarding revenues, expenses, profits, taxes paid, tax planning strategies, tax structuring arrangements, the nature of activities, and any other relevant information.

2. The States Parties agree to cooperate to identify and eliminate administrative barriers that prevent effective mutual administrative assistance, including with respect to transparency and exchange of information for tax purposes.

3. Any information obtained by a State Party under Articles 5 and 6 of this Convention shall be treated as secret and protected in the same manner as information obtained under the domestic law of that State Party and, to the extent needed to ensure the necessary level of protection of personal data, in accordance with the safeguards which may be specified by the supplying Party as required under its domestic law.

4. The States Parties agree to expand assistance in collection of tax debts to the extent possible, taking into account the needs and capacities of the States Parties, as well as national constitutional restrictions.

Zambia, on behalf of the AG, emphasised that from a developing country perspective, Article 6 is central in domestic resource mobilisation and sustainable development. While supportive of the overall article, it argued that Article 6 must be fair, extensive in scope, and reflective of the realities of developing countries.

Sierra Leone, in support of this position, stressed that Article 6 must deliver real and universal cooperation, rather than a system that benefits a few and excludes many. Without strong mutual assistance, it noted that even the best tax rules cannot be enforced, especially against multinational corporations and HNWIs. It highlighted the unequal nature of current information sharing systems, noted that Article 6 must guarantee equitable access, affordability, and built-in technical and capacity support for developing countries.

The question of duplication of existing frameworks by Article 6

Kenya addressed concerns that Article 6 duplicated existing mechanism. It reiterated earlier statements by AG members that the INC is not bound by existing mechanisms. Membership in those forums does not equate to their effective implementation, and in some cases, the benefits of implementing existing mechanisms are limited, as they are neither inclusive nor effective.

Nigeria responding to the same concerns, reiterated that the ToRs explicitly required an article on MAA so its inclusion was non-negotiable.

The African Union noted that while MAA exists in other platforms, including the Global Forum, these are not benefitting many African countries, including those that are not members of the Global Forum. Article 6 therefore remains necessary.

The AU noted that the provision raises an obligation on MAA which can be met in different ways such as through the use of existing standards or new ones developed through the COP.

On behalf of the AG, Zambia made several proposals on Article 6.

On paragraph 1, it suggested the below amendments:

The States Parties recognize that domestic resource mobilization depends on the ability of all States to enforce their domestic tax laws. Accordingly, States Parties shall afford one another the widest measure of mutual administrative assistance (including through exchange of information for tax purposes), to support the administration or enforcement of the domestic laws regarding taxes of every kind and description by another State Party. Such administrative assistance will include the exchange of information regarding revenues, expenses, profits, taxes paid, tax planning strategies, tax structuring arrangements, the nature of activities, and any other relevant information would include exchange of information of any kind.”

Ghana, Sierra Leone and Tanzania expressed their support of the changes made to paragraph 1

To address the deleted text, Zambia proposed creating a new paragraph 2:

2. Such administrative assistance will include the [exchange of information, of any kind,] and any other relevant information.

Zambia explained that this paragraph included one of the elements of mutual administrative assistance as provided in paragraph 1, namely exchange of information. It also provided that instead of going into the specifics of the kind of information, the new proposed paragraph 2 simply stated that "such administrative assistance

Uganda supported the proposal and aligned with the deletion of “regarding revenues, expenses, profits, taxes paid, tax planning strategies, tax structuring arrangements, the nature of activities”

Other forms of mutual administrative assistance

Having addressed exchange of information through a standalone paragraph, Zambia, suggested a paragraph committing MAA in other areas including: assistance in tax collection, simultaneous tax examination, tax examinations abroad, service of documents, or any other form of research.

Addressing Administrative barriers

Zambia proposed amending paragraph 2 by replacing the phrase ‘including with respect to transparency and exchange of information for tax purposes’ with the broader phrase in ‘tax matters.’

This paragraph would therefore read as follows:

3. The States Parties agree to cooperate to identify and eliminate administrative barriers that prevent effective mutual administrative assistance, including with respect to transparency and exchange of information for tax purposes in all tax matters (emphasis added)

It argued that the broader formulation captured the full scope of mutual administrative assistance including through exchange of information for tax purposes. It also noted that the COP will establish the rules and procedures of a number of issues under the Framework Convention and its protocols.

Ghana further proposed that Article 6 should mandate technical assistance, technology transfer, and capacity building for developing countries noting that mutual administrative assistance cannot be effective and inclusive without such support.

Public country-by-country reporting and governing standards on privacy

Zambia, on behalf of the AG, proposed an exception to the confidentiality requirements of exchange of information in paragraph 3. It proposed inserting the phrase:

Any information obtained by a State Party under Articles 5 and 6 of this Convention, except as otherwise agreed by the Conference of the Parties, shall be treated as.."

The full paragraph would therefore read:

Any information obtained by a State Party under Articles 5 and 6 of this Convention [Any information obtained by a State Party under Articles 5 and 6 of this Convention, except as otherwise agreed by the Conference of the Parties] shall be treated as secret and protected in the same manner as information obtained under the domestic law of that State Party and, to the extent needed to ensure the necessary level of protection of personal data, in accordance with the safeguards which may be specified by the supplying Party as required under its domestic law.

Sierra Leone and Tanzania supported Zambia’s proposal, noting that the confidentiality standards hindered their utilisation of country-by-country reporting.

Zambia also called for deleting the phrase referring to safeguards required by the supplying Party as required under its domestic law so that the governing law on privacy be the domestic law.

Under Zambia’s proposal, the paragraph would read:

4. Any information obtained by a State Party under Articles 5 and 6 of this Convention shall be treated as secret and protected in the same manner as information obtained under the domestic law of that State Party.

Ghana supported the provision and suggested that developing countries would benefit from additional safeguards, such common minimum standards for data protection and confidentiality to be developed by the COP.

Special and differential treatment for developing countries

Zambia proposed the deletion of the paragraph on constitutional limitations and tax debts and suggested a new commitment:

In implementation of this article, State Parties shall take into cognizance the needs and capacities of developing countries and countries in special situations, as well as limitations the Conference of the Parties may determine.

This would provide flexibility for evolving global tax rules and architecture, considering developing countries' needs and capacities. The Conference of Parties can provide guidance and support implementation.

Ghana supported this and proposed phased implementation, flexible timelines, and tailored assistance programs, as may be determined by the COP.

Article 7: Illicit Financial Flows, Tax Avoidance and Tax Evasion

Article 7 on Illicit Financial Flows, Tax Avoidance and Tax Evasion provides as follows:

The States Parties agree to cooperate in combating tax-related illicit financial flows, including:

a) by developing effective tools for the detection of tax-related illicit financial flows, enforced through international cooperation and transparent reporting standards, as necessary to ensure effective taxation of income and profits from tax-related illicit financial flows; and

b) through sharing information regarding structures and techniques used by taxpayers to avoid and evade taxes on their income.

Zambia, speaking on behalf of the AG, suggested the inclusion of the word “or implementing” in paragraph (a) to read as follows:

by developing, [or implementing] effective tools for the detection of tax-related illicit financial flows, enforced through international cooperation and transparent reporting standards, as necessary to ensure effective taxation of income and profits from tax-related illicit financial flows; and

This would ensure that the article covers both the development and implementation of tools addressing IFFs.

Defining key terms in Article 7

There was a lengthy discussion on the definition of illicit financial flows, however, many concluded that high-level commitments were sufficient at this stage and the question of definitions would be addressed in Article 3 or through COP-mandated processes.

Kenya supported the proposal to add “implementing” in paragraph (a) and noted that the definition of IFFs would be addressed in Article 3.

Nigeria supported the AG and stressed that jurisdictions affected by IFFs must retain the right to address them directly.

In response to concerns about the content of the article, the co-lead clarified that– tax avoidance and tax evasion are not subsets of illicit financial flows; rather, each concept stands independently within Article 7.

Day 3 – Wednesday, 12 November 2025, Nairobi, Kenya

Day 3 of the Third Session opened with Member States and stakeholders making submissions on Article 8: Harmful Tax Practices.

Article 8 provides as follows:

1. The States Parties recognize that harmful tax practices undermine the ability of all countries to tax income fairly, particularly income derived by multinational enterprises that can shift assets and income across borders. International cooperation, at global and regional levels, is therefore necessary to address such practices and safeguard equitable taxation.

2. The States Parties agree that any tax incentives provided by States Parties should be substance-based, linked to investment or performance, and not merely profit-based.

3. Accordingly, the States Parties agree to cooperate in developing effective tools for combating harmful tax practices, including:

a) through sharing information regarding revenues, assets, employees and reported income on a country-by-country basis, taking into account both the needs and the different capacities of the States Parties; and

b) by introducing appropriate measures, which may include minimum taxes, on business activities originating from jurisdictions with harmful tax practices.

Speaking on behalf of the AG, Zambia reaffirmed that harmful tax practices erode tax revenue and undermine domestic resource mobilisation. It noted, however, that paragraph 1 does not cover commitments and therefore proposed the following:

The States Parties [agree to take effective measures to address harmful tax practices] recognize that harmful tax practices undermine the ability of all countries to tax income fairly, particularly income derived by multinational enterprises that can shift assets and income across borders. International cooperation, at global and regional levels, is therefore necessary to address such practices and safeguard equitable taxation.

On paragraph 3, the AG suggested that tools should include both policy and administrative measures with the understanding that high level wording is appropriate at this stage. It further noted that there should be a definition of harmful tax practices in later drafting work even if definitions were not on the agenda.

It suggested the following amendments to paragraph 3

a) through [effective] sharing [of relevant] information regarding revenues, assets, employees and reported income on a country-by-country basis, taking into account both the needs and the different capacities of the States Parties; and should commit to sharing relevant information as one way to cooperate in addressing harmful tax practices.

b) by introducing appropriate measures, which may include minimum taxes, on business activities originating from jurisdictions with harmful tax practices.

Nigeria aligned with Zambia on behalf of the AG. In its national capacity, Nigeria added that there are several frameworks that have been recognised by the Terms of Reference and their treatment should be considered at the appropriate time. It added that on 3(b), the phrase “business activities originating from jurisdictions with harmful tax practices” should be refined to “business activities benefitting from harmful tax practices” and on “minimum taxes” under paragraph 3(b), it indicated that this is not jurisdiction-specific but intended to ensure at least a minimum of taxation.

Kenya highlighted that Article 8 is drawn from paragraphs 10(e) and 22 of the Terms of Reference. It indicated that although there are discussions on the topic occurring is other fora, that didn’t preclude its discussion in the Intergovernmental Negotiating Committee.

It supported the AG’s position and highlighted the following:

The need to develop tools to effectively address harmful tax practices, including: measures such as substance-based incentives, exchange of information, and minimum tax rules.
The importance of reforming incentive regimes, especially those not linked to substance. The relevance of information exchange on ring-fenced regimes, including private rulings or taxpayer-specific rulings.
The need to recognise harmful tax practices as a sovereign decision, but one that creates competitive distortions requiring collective action. That Special Economic Zones (SEZs) and Export Processing Centers (EPCs) when substance-based, should be considered within the elements of substance-based incentives.
Although existing fora address harmful tax practices, the INC provides an inclusive platform for states that are not members of those bodies.

Rwanda recognised the importance of having an article on harmful tax practices and noted that existing frameworks limited participation. It agreed with Nigeria that complementarity with existing fora then could be discussed at a later stage.

Sierra Leone emphasised that harmful tax practices weaken public trust and threaten development. The article therefore sought to safeguard tax bases and ensure domestic revenue mobilisation. It supported the AG’s wording.

Nigeria indicated that if existing tools and fora to harmful tax practices were practical, inclusive and acceptable, then Member States would not need to negotiate a new convention. The work of the INC is to produce a framework that works for all Member States. As Member States and stakeholders, they had to draft what they had been mandated to do. There are many jurisdictions who are not members of the existing forums.

Mauritius first aligned itself with the Africa Group and noted that it had been following the work done of other forums and had adjusted its domestic tax regimes accordingly. It noted that while existing rules can serve as a starting point, further work was required to define a harmful tax practice. States would then need sufficient time to reform their domestic tax regimes and clarification provided on how the article would apply to no-tax jurisdictions.

Uganda aligned itself with the AG, Nigeria and Rwanda in recognising the importance of the article. It emphasised the need to reconcile existing frameworks with the work of the INC.

Tanzania noted that although other fora address harmful tax practices, they lack representation from a number of Member States. It stressed that identifying what makes a tax practice harmful remains a core issue for ongoing drafting

The African Union stated that the Terms of Reference mandated an article on harmful tax practices. It noted that many African Union Member States have been treated unfairly under existed platforms that lacked inclusivity. The AU stressed that the mandate of the INC is to develop an inclusive and effective international tax framework.

The co-chair, Daniel Nuer, reiterated that Member states and stakeholders had developed the text of the article during the intercessional sessions and that the committee’s role was to facilitate the drafting. He reminded delegates that the legal rules of interpretation such as the golden rules of interpretation and the principle that words are given their ordinary, grammatical meaning applied.

ATAF highlighted that harmful tax practices undermine revenue collection due to the weaknesses in their scope, design and inclusivity. It supported maintaining substance-based incentives, strengthening transparency around incentives, and noted that minimum taxation is an example of possible measures.

Sustainable Development.

Article 9 on sustainable development states:

Taking into account their different capacities, the States Parties agree to pursue international tax cooperation approaches that will contribute to the achievement of sustainable development in its three dimensions, economic, social and environmental, in a balanced and integrated manner.

Zambia, on behalf of the Africa Group, indicated that it supported Article 9 highlighting its link to domestic resource mobilisation. It welcomed language acknowledging the different capacities of states and noted that this promoted inclusivity and fairness. The AG reaffirmed its commitment to a fair and inclusive convention.

Prevention and Resolution of Tax Disputes

Article 10 on Prevention and Resolution of Tax Disputes provides as follows:

The States Parties recognize that implementation of effective measures for avoiding and resolving tax disputes supports cross-border investment and cross-border trade in goods and services.
The States Parties will seek to minimize the potential for disputes by providing clear and accessible legislation and interpretative guidance regarding tax obligations.
The States Parties also will strive to implement domestic dispute resolution mechanisms that are fair, independent, accessible, and effective in resolving disputes in a timely manner for both taxpayers and the tax authorities involved.

The co-lead indicated that the prevention and resolution of tax disputes was a commitment in the Terms of Reference and corresponded to Protocol 2. The co-lead requested the secretariat to go through the examples of disputes to be covered under this protocol. The secretariat explained that Article 20 of the draft framework convention would look like provisions in other multilateral conventions and address disputes between governments. Examples of covered disputes include transfer pricing adjustments (Article 9 of UN MTC) and disagreements on deductibility versus capitalisation of expenditures.

Zambia, on behalf of the Africa Group, agreed to reflect on the examples given by the co-lead as article proposals may evolve depending on the scope of Article 10. It recommended merging paragraph 2 and 3 and deleting the words “The State Parties” and “domestic.”

The article will therefore read as follows:

The States Parties also will [The Parties shall] strive to implement domestic dispute resolution mechanisms that are fair, independent, accessible, and effective in resolving disputes in a timely manner for both taxpayers and the tax authorities involved.

Day 4 – Thursday, 13 November 2025, Nairobi, Kenya

On the fourth day, discussions continued on the article on dispute prevention and resolution.

The co-lead, Daniel Nuer, explained the relationship between Articles 10 and 20 of the Framework Convention and the protocol on dispute prevention and resolution. He highlighted that the convention contains high-level commitments and inform the basis for the ongoing discussions. He indicated that the articles will not be rules to be enforced. The protocols are for implementation for the commitments. On Article 20 he stated that it relates to the framework convention itself and the disputes that will arise from implementation of the convention. Regarding the principles of sovereignty, there can be no framework convention unless it is enacted into law in various jurisdictions. He added that the Framework Convention will have to be ratified by the Member States.

Following the intervention by India, Zambia made submissions in a national capacity. Highlighted that there is a need for clarity in terms of the scope of articles 10 and 20. The examples from the previous session were purely domestic issues.

Speaking on behalf of the Africa Group, it submitted that they agreed to Article 10, subject to the following amendments. In their view, the current wording of paragraph 1 of the article reads like a preamble. Rather, they proposed the following amendment in paragraph 1:

The States Parties [commit to implement effective measures for the prevention and resolution of tax disputes] recognize that implementation of effective measures for avoiding and resolving tax disputes supports cross-border investment and cross-border trade in goods and services.

The Africa Group further proposed that paragraphs 2 and 3 of Article 10 be merged and amended into a single paragraph, to emphasise the commitment, as follows:

In furtherance of this commitment, the State Parties will:
The States Parties will seek to minimize the potential for disputes by providing clear, accessible legislation and interpretative guidance on tax obligations.
The States Parties will also strive to implement domestic dispute resolution mechanisms that are fair, independent, accessible, and effective in resolving disputes in a timely manner for both taxpayers and the tax authorities involved.

Scope of Article 10: Domestic disputes and/or Cross-Border Disputes

Nigeria aligned with Zambia's position, particularly regarding the proposed amendments or redraft of the article to reflect its aspirations. They expressed concerns about the use of the words' domestic' and 'tax sovereignty' in paragraph 3 of the article. The commitment expected of members in Article 10 is to take action to improve dispute resolution. As such, it must be given the widest possible scope, since the terms of reference refer to tax disputes with reference to either domestic or cross-border tax disputes, which must be given the widest application.

Algeria aligned with Zambia's statement on behalf of the Africa Group. It supported the high-level commitment to achieving legal and tax certainty for investment, thereby promoting economic development and safeguarding taxpayers. It stated that there is a shadow zone and that there is a need to remove any ambiguity in the application of Article 10. Article 10 should have a precise title. This article does not apply to domestic disputes, which fall under the jurisdiction of state sovereignty.

A misunderstanding of a subject matter would lead to taking note of the words and language as captured under the terms of reference, which provide guidance on the effective prevention and resolution of tax disputes. In their view, the statement in the terms of reference is broad enough to encompass several issues related to tax disputes. In that light, that is the basis for their alignment with the statement made on behalf of the Africa Group by Zambia. They submitted that the proposed amendment captures the commitment to a broad, effective prevention and resolution of tax disputes. They further submitted that there was a need to draft a comprehensive article to clarify how to handle disputes and simplify the mechanisms. They stated that the rules related to Article 10 will lie within Protocol 2, dealing with the prevention and resolution of disputes. On the examples given the previous day by the committee, they commented that the examples brought clarity on what needs to be addressed, namely, cross-border disputes (without borders) or domestic disputes between a resident entity and a tax authority. In winding down their submissions, they stated that the interplay between Article 10 and Article 20 involves two principles to be considered: the issue of confidentiality and subject matter deliberations. In particular, they stated that if an action of a particular Member State breaches confidentiality, and at the same time, whether the misunderstanding of a subject matter would lead to tax disputes. But in their view, these are discussions that could take place at a later point in the negotiations.

Tanzania aligned with the intervention made by Zambia on behalf of the Africa Group and in a national capacity. They emphasised that Article 10 should focus on cross-border tax disputes in line with the Convention. They supported the proposed text by the Africa Group on paragraph 2. Their concern was that the text in draft paragraph 3 has wording that may extend the article to domestic tax disputes. To conclude, they stated that they support the use of text by the Africa Group to ensure the article remains limited to cross-border disputes.

The African Union stated that tax disputes were mentioned in three sections, with a focus on paragraph 10(f) of the terms of reference. Within this commitment, there was a specific emphasis on the prevention and resolution of tax disputes, rather than domestic or cross-border tax disputes. This drafting was not intentional. The statistics showed that the improvement in dispute resolution generally improves the outcomes of both revenue and tax certainty. Often, this is a commitment to improve dispute resolution processes.

With respect to Protocol 2, as outlined in paragraph 14 of the terms of reference, members have expressed support for limiting the mechanism to be developed under Protocol 2 to cross-border disputes. In their view, that is when they will begin to determine the scope of the disputes. Regarding the relationship between Article 10 and Article 20, they agreed that they cannot be read independently; however, the current discussions should be restricted to Article 10. However, they supported the African group in meeting the spirit and aspirations of the Article.

Capacity- Building and Development

The Chair, in relation to capacity-building and development, questioned whether each article should include a clause on capacity-building or whether a standalone article on capacity-building and development would be more effective.

In response to this, Sierra Leone stated that capacity-building should be a stand-alone article in the convention. It is submitted that, as a developing country with evolving tax systems and administrative structures, it recognises that effective participation in global tax systems requires capacity. It further submitted that the commitment to capacity-building should be given the same weight as other substantive articles in the convention. It stipulated that such an article could establish a clear obligation on the part of developed countries to ensure capacity-building support. In their view, capacity-building should be a binding instrument in the convention.

Following interventions by Member States from both the Global North and Global South, the meeting adjourned.

Day 5 Friday 14 November 2025, Nairobi, Kenya

The negotiations proceeded with the discussion on capacity-building and development. The Chair, Ramy M. Youssef, stated that a draft on capacity-building is needed to facilitate discussion in the February session of INC. The Chair led with questions. The previous day, the question of capacity-building, specifically the role and integration of capacity-building provision, was considered, particularly whether it should be part of the other articles of the convention or a standalone article. The Chair elaborated that the Article on capacity-building is important in operationalising the Framework Convention.

The Member States and stakeholders were asked to consider the following options for including capacity-building in the article:

Should capacity-building be treated as a standalone article dedicated to capacity building?

Or whether,

Specific clauses should be integrated in each other's substantive articles (such as Articles 5, 6, and 7) that directly link the implementation of obligations to the provision of capacity-building support. For example, Article 6 on mutual assistance might include a clause stating: "The implementation of this Article for developing countries shall be supported by capacity building and technical assistance as outlined in Article 11.

Role and integration of capacity-building

ATAF made a brief intervention. It supported the idea of capacity building, which was explained by the African Union. It stated that capacity building remains critical for their members, especially on international tax, thus it should be included as a commitment in the convention. It supported having capacity building as a stand-alone article. Furthermore, they believed that the article should provide a clear comprehension and articulation of different aspects of capacity building. On what is important but most draws from the convention itself.

Kenya supported the introduction of a comprehensive, stand-alone article that will address capacity-building. However, they stated that the article should apply to all aspects of the convention. In the TOR, the article should include elements such as institutional mechanisms. Further, there should be a mention that the article applies to both developing and developed countries.

Rwanda, like Kenya, proposed having a separate and comprehensive article as it was an important commitment. They further proposed that the introduction of the article on capacity building should be in accordance with the terms of reference. There should be a clear framework to coordinate this framework. It also noted that it is essential to have a clear scope that adequately reflects the needs of member countries, ensuring alignment with the convention's objectives. The scope would be determined during the discussions on the framework convention.

The African Union made an additional comment to their previous day’s comments. They stated that the article should be a stand-alone article drafted in accordance with the terms of reference of the convention. It further stated that the article must reflect the needs of developing countries. It stated that it should recognise aspects such as transfer of skills and technology. They proposed that, under the article, it would be ideal to have a dedicated fund to ensure that any commitment made under this article is implemented and supported with funding. For them, the Article must have smooth synergy and cooperation on different elements and mechanisms already operating

The African Union also emphasized the relevance and importance of coordination with regional and international bodies, providing the necessary capacity.

The meeting then moved to discussing the scope of the article on capacity-building and development.

Scope of capacity-building

The Chair presented and stated that the scope of capacity building should be clearly defined, as this will help to ensure targeted and effective support. Possible components include technical assistance, technology transfer, training, or a combination of all these elements. The Chair opened the discussion to the floor and enquired if there were any other components that should be considered.

Nigeria stated that when referring to capacity, often our minds go to skills as the ability to perform technical work. However, there may be a skills gap, but it is not as if African countries lack skills. In fact, capacity extends beyond skills and encompasses resources, including infrastructure. For instance, many countries possess the skills to conduct capacity building, yet they lack the resources to access databases for benchmarking transactions. Moreover, on EOI, some countries lack the tools to analyze or mine the data available to them. Therefore, capacity building should not be viewed solely in terms of technical skills, but also in terms of the availability of resources to access the tools that make the work of tax administrations more efficient in developing countries. Additionally, depending on the definition of technical assistance, it may include access to databases, among other services.

After submissions on the scope of capacity-building, the Chair further posed the following question.

How do we address the capacity needs of the most vulnerable, such as Small Island Developing States (SIDS) and Least Developed Countries (LDCs), who face unique challenges like limited human resources?

Sustainable approach to addressing the needs of SIDS and LDCs

The Chair put it to the floor whether there should be separate provisions applicable to SIDS and LDCs.

From a developing country's perspective, Lesotho stated that what is required are longer-term solutions, such as centres of excellence, which would be co-sponsored and supported by the United Nations.

Before addressing the issue of the best approach for capacity building in SIDS and LDCs, Tanzania supported capacity building as a standalone article, whose purpose would be to bridge capacity gaps between tax administrations. They then indicated that the article must include technology transfer, skills transfer, data management, and technical capacity, which align with domestic resource mobilisation. Additionally, they emphasised the need for a commitment to introduce new and emerging tools that would be accessible to all state parties. Furthermore, they indicated that the mobilisation of resources is crucial to realise the objectives of the convention, including addressing the resource needs of developing countries. Consequently, they stated that there should be cooperation in capacity-building to ensure that the needs of the most vulnerable countries are met.

The chair's further view was that, based on his country experience, the issue for developing countries was how to make capacity building sustainable.

Morocco highlighted that what the chair presented is important, namely, the sustainability of capacity building. They further highlighted that the most important issue is for Member States to be able to address this themselves, so that we can maximise capacity building. In their view, it would be difficult to identify the needs of different countries; one needs to listen to various countries to understand their specific needs.

After several submissions from the floor, the delegates considered the role of the UN secretariat with respect to capacity building and technical assistance. It posed the following questions to the floor:

What should be the role of the UN Secretariat under this Convention with respect to capacity building and technical assistance?
Should it act as:
A coordinator;
A standard setter for quality, or
A direct provider of assistance in the areas needed?

Role of the UN Secretariat in capacity development

The African Union's position was that the secretariat's functions should align with the framework's objectives, and its role should be multifaceted. This includes coordination with capacity-building organs of the United Nations, collaboration with other entities, and direct provision of assistance to Member States. The secretariat could also play a facilitative role, supporting members in various ways.

On this question, Member States, such as Sierra Leone, believed that the primary role of the secretariat was to serve as a global coordinator, be a central platform for mapping and aligning capacity-building efforts with other institutions, including the IMF and the World Bank. Additionally, conduct needs assessments for LDCs and SIDS, facilitate information sharing among organizations to promote consistent approaches, and provide policy recommendations. The UN Secretariat should serve as a neutral hub that ensures coherence, relevance, and capacity building, while addressing the capacity gaps for the most vulnerable countries.

Later in the session, Kenya addressed the role of the UN secretariat, which could have a combined role of coordination, standard setting, and directly providing assistance. These roles are crucial to ensure standardization and objectivity in the capacity building. On a practical level, this presents an opportunity to develop a centre of excellence with a pool of experts; there are programs by the UN that utilize negotiators. The secretariat would still have a role to ensure the standard is maintained and that whatever is requested is provided, while maintaining objectivity.

The discussion thereafter included the following issues, which member parties had to consider for future work on the article:

Mandate of the Conference of the Parties on Capacity Building: How can the Conference of the Parties be mandated to regularly review not just implementation, but the adequacy and effectiveness of the capacity-building support provided?
Funding Models for Capacity Building

How do we ensure capacity-building is treated as an 'integral component' of all cooperation, rather than a separate, optional 'add-on' that may or may not be sufficiently resourced?

Will a purely voluntary fund be sufficient to meet the significant and differentiated needs identified by Member States, or should we consider a more predictable and sustainable funding model?

If the funding is voluntary, how can we ensure that capacity-building programs are demand-driven and designed by developing countries themselves, rather than being supply-driven by donor priorities? How do we institutionalize this in the Convention's implementation?

Workstream II Taxation of income from cross-border services

In the afternoon, the Member States were briefed on the developments on workstream II on the taxation of income from cross-border services in a digitalised and globalised world.

The Second Session of INC Tax Workstream II was held in August and focused on taxation of income from cross-border services. During the session, the Committee reviewed examples previously analyzed in workstream meetings, explored new approaches to taxing cross-border services income based on Issues Note questions, and discussed other issues, such as protocol structure, service information exchange, and dispute resolution for Protocol 1.

The co-lead highlighted that the work had taken two main forms: exploring possible approaches to identify areas of agreement and disagreement, and continuing discussions on economic analysis, primarily focused on data issues. As part of the economic analysis, a literature review is being conducted and will be shared prior to the February 2026 session. The analysis will be shared with workstreams for discussion before being finalized.

To ensure consistency in economic terms, a short paper will be presented at the February meeting discussing basic economic concepts. This will be followed by modeling of possible approaches before the August Session.

The INC Tax Workstream II is making progress on key substantive questions, focusing on possible new nexus rules, the role of physical presence, net and gross basis taxation, and rules for different types of services. They're working on the outline and plan to have a technical discussion in February.

The Workstream members are preparing a proposed solutions paper for the February Session in New York, with the introduction based on the June issues note and August discussions. The work is expected to intensify over the next few months, with papers scheduled for release approximately 10 days prior to the February Session.

The meeting was adjourned to Monday, 17 November 2025.

Day 6 Monday 17 November 2025

The discussion on Workstream 3, on dispute prevention and resolution, began on week 2 of the INC third session. On the 24th of October 2025, the co-leads of the workstream shared the concept note with the potential solutions.

The session began with an overview of Workstream 3. The co-lead noted that the scoping phase had clarified the key issues and challenges that needed to be addressed under the UN Tax Convention process, and that the negotiations were moving beyond problem identification toward the development of concrete solutions. The session represented the first structured opportunity to consider and discuss possible policy and institutional approaches, with the aim of deepening understanding of these approaches, including their implications, interlinkages, and potential impact, while also collectively assessing their feasibility, coherence, and overall effectiveness and identifying strategic priorities and key needs to inform and guide the next phase of work.

The co-lead stated that the Concept Note on Ideas for Potential Solutions introduced a set of preliminary approaches for the Committee’s consideration, building on the main topics that had emerged from the scoping phase. According to the co-lead, these approaches were conceptual and exploratory in nature, intended to enhance understanding of possible ways forward, serving as the basis for a structured discussion during the session.

Optionality Approaches Suggested in First and Second Sessions of INC

Based on the presentation made by the co-lead, drawing from the previous first and second substantive sessions, optionality had received strong support during the scoping phase; however, concerns were also raised about the potential procedural complexity that could arise if too many opt-in and opt-out choices were permitted. Again, drawing from previous sessions, the co-lead stated that it was proposed that a comprehensive menu of potential mechanisms for the prevention and resolution of tax disputes be developed to provide a clear overview of the available options, while also identifying which of these mechanisms could constitute the protocol’s core mechanisms.

The Committee was invited to discuss optionality in the following context:

(a) whether the Committee finds appropriate the proposed approach of first elaborating a comprehensive menu of mechanisms for prevention and resolution of tax disputes, and subsequently identifying those core mechanisms which, in principle, should be available for use by all parties

(b) whether the mechanisms under the protocol, including the core mechanisms, should not have a superseding effect, unless the concerned parties agree otherwise, in order to apply such mechanisms in lieu of or to complement existing ones, or in the absence of any such mechanisms

(c) whether there are views on how optionality could be operationalized in practice to balance broad participation, inclusiveness and legal certainty (e.g., through prior opt-in or opt-out declarations, on a case-by-case basis, or through other modalities)

Should the protocol address domestic tax disputes?

The co-lead’s presentation outlined that the protocol could apply to cross-border disputes, including those under existing tax treaties, and could optionally cover “no-treaty” situations with party agreement. Disputes under the Framework Convention or its protocols would be addressed in the drafting of those instruments.

In the first and second sessions, member states and stakeholders had requested examples of what would constitute tax disputes. On that basis, the committee provided the following examples to guide the discussions during the third session:

Article 9 of the Country A-Country B tax treaty conforms to Article 9 of the UN Model Tax Convention. The tax authorities of Country A determine that the price charged by its resident, Company A, to its corporate sibling, Company B, a resident of Country B, should be 10€/unit higher. The tax authorities of Country B review the adjustment and determine that the original price is correct.
A company incorporated in Country A manages all its key decisions from Country B. Both countries claim full tax residence, and tax the company over its worldwide income. Article 4 of the Country A-Country B tax treaty follows Article 4 of the UN Model Tax Convention.
A company resident from Country A receives dividends from its subsidiary in Country B, where a withholding tax was paid. Tax authorities of Country A later deny the foreign tax credit, arguing that the charge was not an “income tax”. Country A-Country B tax treaty follows the UN Model Tax Convention.

To further guide the discussion, the committee was invited to discuss the following:

(d) whether the Committee has views on the key elements that could help shape a definition of a cross-border tax dispute for the purposes of the protocol, and in particular, whether the following situations could fall within its scope:

situations involving two or more national tax law frameworks providing taxing rights over the same taxpayer, transaction or income;
the possibility of double taxation or double non-taxation, even if largely theoretical;
issues of double taxation arising from the differing application of the arm’s length principle by different tax administrations in transfer pricing adjustments;
issues related to permanent establishment determinations, tax residence or withholding taxes arising in one jurisdiction but with implications for another in relation to potential double taxation or non-taxation;
differing views regarding the interpretation and application of tax related provisions in bilateral or multilateral instruments by tax administrations; and
situations that meet most of the identified characteristics of a cross-border tax dispute but lack a shared legal basis, such as a bilateral treaty;

(e) whether the Committee could provide practical examples of cross-border tax disputes in “no-treaty” situations

(f) whether, with respect to domestic disputes, the Committee supports the possibility of empowering the CoP, at a later stage, to develop and recommend optional future guidance or best practices on such matters

(g) The Committee is asked to consider whether the protocol should establish a legal basis for cross‑border administrative cooperation in tax dispute prevention, and to identify what preventive mechanisms should be included in such a legal basis.

(h) The Committee is invited to assess whether addressing prevention through the capacity‑building commitment of the FC and the development of a CoP of best practices is appropriate, or whether additional views or suggestions on this approach are needed.

(i) whether the proposed approach of reinforcing MAP through both the protocol and best practices is adequate to make it more effective and accessible.

(j) whether the Committee has views on the possible design features of a protocol’s MAP provision, such as measures to promote transparency and information-sharing, or other measures addressing the root causes of current limitations.

(k) whether the Committee finds appropriate the approach of having arbitration and other mechanisms such as mediation or conciliation as optional tools in the protocol, and whether there are views on their possible design features, including issues such as inclusiveness in the composition of panels, the non-binding nature of some mechanisms, and the conditions under which they could be applied

(l) whether the Committee has views on a possible role for the UN in supporting the operation of these resolution mechanisms, including through assistance, hosting or acting as a permanent or ad hoc forum

(m) whether Member States could share perspectives on the possible governance arrangements of a potential UN-managed database, including questions of financial implications, management responsibilities, participation of Member States, and safeguards for data confidentiality and integrity;

(n) whether other types of databases could be considered, such as databases compiling bilateral APAs or MAP cases.

Approach to developing and applying dispute prevention and resolution mechanisms, including the identification of core mechanisms and their non-superseding/superseding nature

Kenya, on behalf of the Africa group, supports a comprehensive approach with a common baseline and optional provisions.

Zambia, in support of comments made by the Africa Group, submitted responses to the three questions posed by the co-leads of Workstream 3. They stated that, in terms of question 1, they support an approach where there are several comprehensive options for dispute prevention and resolution. From those options, the committee identifies the core mechanisms, and these should be those that are easy to implement by member countries. The mechanisms should not place an administrative burden on resource-constrained jurisdictions. On question 2, they agreed that these mechanisms should not have a superseding effect if optionality is preferred.

Ghana aligned with the statement of the Africa Group. In their national capacity, they supported the two-step approach on optionality, considering it practical to begin by elaborating several options on dispute prevention and resolution mechanism before determining which one should be a common baseline for all parties. However, they stated that greater clarity is required on how optionality will operate in practice. Their position was that optionality could introduce flexibility for countries with diverse capacities. Without clear parameters, there is a risk of introducing uncertainty rather than enhancing cooperation. They emphasised three points:

Structured development of the mechanisms- it supported the deliberate inclusive design of a full suite of mechanisms for both prevention and resolution of disputes. They stated that the mechanisms should be reflecting the experiences of all countries especially developing countries covering administrative, cooperative and treaty body tools.
Defining core mechanisms with equity and balance- the mechanism which is identified as the core mechanism should reflect accessibility, fairness and capacity. Also stated was that the mechanism should not impose administrative burdens on developing countries.
Operationalising optionality in coordination with workstream 1- They state that it is essential to ensure coherence with the overall architecture of the proto ensure overall architecture of the protocol how parties exercise the choices, how these choices would be communicated, and safeguards that optionality does not undermine fairness in tax cooperations.

Ghana concluded that the mechanisms must be designed with precision, to ensure that flexibility does not come at the expense of the protocol.

Côte d'Ivoire supported the Africa Group and other African member states. It stated that it would be appropriate to have an inventory of options amongst which the preferred mechanism would be identified. Also, they stated that the committee needs to continue the reflection on optionality to consider the scope and consequences of the preferred mechanism. In their proposal, countries which adheres to the protocol should be bound by minimum requirements in the protocol. They proposed that it would not be appropriate to have a protocol which is optional and having provisions which are optional as well. Thus, a country which opts in to the protocol show be bound by minimum requirements.

Mauritius aligned with the Africa Group position that the committee should first identify all the possible mechanisms then out of which then identify the mechanisms which would be core. However, they were not in favour of the mechanism having a superseding effect as provided in question (b) of the presentation proposing the superseding effect of the mechanism.

Algeria supported the position of the Africa Group, emphasising that the mechanisms should remain optional so that each country can apply the protocol in a manner aligned with its national priorities. Regarding the scope, Algeria stressed that the protocol should not replace existing mechanisms but rather complement them where appropriate. They further noted that maintaining optionality would encourage progressive adoption, giving states the time needed to prepare, adapt, and implement the mechanisms according to their relevance.

Rwanda aligned with other member states on the need for optionality, emphasising that the Committee should first elaborate the mechanisms and then identify the core elements. Rwanda strongly advocated for the Mutual Agreement Procedure (MAP), noting that member states already have the capacity to implement MAP and are familiar with its tools. They stressed that no mechanism should have a superseding effect over others. Rwanda also supported an opt-in approach to the Protocols, arguing that this would allow developing countries sufficient time to operationalise the dispute-resolution mechanisms.

Morocco supported the Africa Group on optionality. They endorsed the approach under question (a), noting that it would allow countries to assess the compatibility of proposed mechanisms with their domestic tax dispute frameworks and evaluate their capacity to adopt them. Morocco emphasised that the focus should remain on mechanisms such as MAP. On question b), they agreed that the mechanisms should not have a superseding effect, as this would help preserve legal certainty and protect existing bilateral treaties.

Sierra Leone submitted that its position reflects both administrative realities and the need to protect legal sovereignty, aligning itself with the Africa Group. It supported the comprehensive menu approach, noting that elaborating the full menu first would promote inclusiveness and allow developing countries to address capacity constraints before accepting binding obligations. This sequencing would also ensure that mechanisms are adopted only when countries are administratively ready. The delegation cautioned against quickly identifying core mechanisms, as some options may not be feasible for many developing countries. Complex procedures, such as mandatory MAP deadlines, expert panels, or arbitration, were highlighted as particularly unsuitable in contexts with limited capacity. They strongly objected to any classification of arbitration as a core dispute-prevention or resolution mechanism. It was further emphasised that the process of identifying core mechanisms must not undermine taxing rights, policy space, or national sovereignty. Taxation, they stressed, is a fundamental sovereign function that should not be outsourced to external tribunals.

Nigeria aligned with the position of the Africa Group and endorsed the views of other colleagues, including Ghana, Zambia, and Sierra Leone. It supported the dual-stage approach, which involves first developing a comprehensive menu of mechanisms, followed by an open discussion to identify those that should be considered core. This phased approach, Nigeria noted, preserves policy space while establishing meaningful tools, providing stability and flexibility to the protocol.

Uganda aligned with the Africa Group and, within its national capacity, supported the position of Côte d'Ivoire regarding the clarification of principles for identifying the core mechanisms. On question (a), Uganda noted that the phrase “…subsequently identifying those core mechanisms which, in principle, should be available for use by all parties” was confusing. Their understanding was that the mechanisms were already intended to be available for use by all parties.

The co-lead stated that it would reflect on the last part of the paragraph and revert during the meeting.

Tanzania stated that on question (a), it supported developing a comprehensive menu of mechanisms, followed by the identification of core mechanisms. However, the core mechanisms should exclude any that have historically had negative impacts on developing countries. Each mechanism should undergo an impact assessment and sensitivity test to ensure it is appropriate and fair. On question (b), Tanzania emphasised that the protocol should have no superseding effect, with treaty-preservation rules favouring existing bilateral agreements. The protocol should not override domestic laws, and available domestic tax dispute mechanisms should be given priority.

Lesotho made its submissions and highlighted that there are negotiations for the improvement of MAP. Thus, these once developed, should supersede other mechanisms.

In the afternoon the discussion on Workstream 3 on dispute prevention and resolution continued.

The African Union submitted that the Committee should prioritise the elaboration of the text, given the approaching deadline for completing the protocol. It highlighted the Mutual Agreement Procedure (MAP) as the preferred mechanism, noting that it respects domestic sovereignty and existing domestic mechanisms. Other mechanisms may be introduced only after the MAP processes have been exhausted. The African Union also expressed opposition to arbitration on behalf of its member states, supporting instead a core mechanism with a backstop of other mechanisms. It emphasised that the Committee should not lose sight of the purpose of the work to promote international cooperation and that fast-track instruments could be developed to clarify how the protocol interacts with existing mechanisms.

Key Elements for Defining a Cross-Border Tax Dispute Under the Protocol

The Committee was invited to discuss question (d) quoted above.

Sierra Leone welcomed the Committee’s work to clarify the scope of cross-border dispute-prevention and resolution mechanisms. It supported the proposed elements under question (d), noting that they effectively address the risks of double taxation. Sierra Leone highlighted the importance of the protocol arising from transfer pricing or permanent establishment rules.

Nigeria first commented on the first bullet in question(d), which states: "situations involving two or more national tax law frameworks providing taxing rights over the same taxpayer, transaction or income." They noted that this phrasing is structurally incorrect, as it treats taxpayer income as a separate element, which is not always the case. For example, a company resident in Country A conducting business in Country B may be subject to taxation in both countries on the same income. Nigeria suggested that a more appropriate phrasing would be: "taxing rights over a person in respect of income," as this clearly captures situations involving double taxation.

They further noted that the other four bullets under question (d) are all related to double taxation and therefore linked to the first bullet. In a second intervention, Nigeria highlighted that the Convention currently does not refer to permanent establishments or the arm’s length principle, meaning that until relevant rules or standards are developed, the protocol would remain largely dormant.

Tanzania made submissions regarding the scope of the protocol, stating that it should be limited to disputes arising from multilateral or bilateral tax treaties. Tax disputes involving one or more jurisdictions should only be included where a relevant treaty applies. Tanzania further noted that risks of double taxation or double non-taxation should be considered only if treaty-related, and that treaty provisions should guide all elements of question (d), with domestic law being applicable before applying the protocol mechanisms.

The meeting adjourned after submissions from other member states and states.

Day 7 Tuesday 18 November 2025

The dispute prevention discussion continued.

The co-lead stated that during the scoping phase there was support to limit the protocol to cross-border tax disputes. He indicated that there was still a lot more work to be done on the protocol. On that basis, the following question from the co-leads presentation was put up for discussion:

On question (f) Nigeria stated that disputes within the domestic law of any jurisdiction should be dealt with by a country as it sees fit. Question (f) would lead to the usurpation of national sovereignty.

Côte d’Ivoire noted that while all countries and tax administrations are interested in good practices, each country should primarily manage its own tax affairs, while at the same time keeping in mind the main objective of the current process, which is to adopt the convention and the two protocols in order to achieve a fairer tax system. In this regard, Côte d’Ivoire cautioned against relying on the Conference of the Parties (COP) to develop best practices on issues related to international tax cooperation, as this is not the appropriate forum for such work. Moreover, the COP will already have a substantial workload, and adding additional responsibilities would place an undue burden on it and would not be consistent with the main goal of the process.

The co-lead stated that there was broad support for continuing the work on dispute prevention. Also, the committee was aware of the complexity of the mechanisms suggested for dispute prevention.

The co-lead explained that it was understood that domestic dispute prevention mechanisms could form a basis for addressing cross-border tax disputes, while remaining mindful of the sovereignty of Member States.

Also, the co-leads explained that there was overwhelming support for the protocol to address cross-border tax disputes. Some member states in support of the forum could assist in improving domestic tax dispute mechanisms under all tax heads.

Nigeria took the floor again following the clarification by the co-lead and noted that, for jurisdictions that may require assistance with dispute resolution processes, there are already functioning initiatives in place, including support provided by the UN and other tax bodies to strengthen countries’ tax administrations. Consequently, Nigeria considered the question to be premature and, at this stage, questionable.

Legal basis for the protocol

Zambia stated that having a legal basis for the protocol will enable member states to access tools for dispute prevention. It stated that one should be mindful that the proposed measures for dispute prevention come with some level of complexity, such as APAs. Other measures, like joint audits, require collaboration between member states and revenue administrations. Zambia also responded to question (h), stating that capacity building becomes critical in those jurisdictions where there is a need for upskilling to benefit from the proposed measures.

Algeria stated that, in terms of the proposal for a legal basis for a dispute prevention mechanism, having such mechanisms is important to facilitate and prevent disputes. It is important and underscores paragraph 20 of the concept note, where several examples are proposed.

Dispute Resolution

After the break, the co-lead stated that during the scoping phase, concerns were raised about the effectiveness, accessibility, and the lack of necessary treaty relationships. Thus, the approach being proposed by the co-leads is to strengthen MAP through the protocol and provide best practices at a later stage. They further stated that there was a need to consider the role of the UN in facilitating the dispute resolution mechanisms on either a permanent or temporary basis.

The Committee was invited to discuss:

(i) whether the proposed approach of reinforcing MAP through both the protocol and best practices is adequate to make it more effective and accessible

Nigeria, speaking on behalf of the Africa Group, addressed the questions raised during the discussion. Regarding question (i), the issue was whether an efficient and effective Mutual Agreement Procedure (MAP) process was desirable for resolving tax disputes, and the Group noted that such an approach would make MAPs both more effective and more accessible. Furthermore, regarding the relevant features and measures, the African Group expressed a preference for a UN body to monitor MAP-related issues, as well as for procedures that were simple and easy to follow. In addition, with respect to question (k) on the approach to arbitration and other mechanisms, the African Group stated its opposition to any form of arbitration, as it had largely proven to be an unfair process. Finally, on question (l), the Group emphasized that the UN had a significant role to play in determining which dispute resolution mechanisms should be applied.

Kenya stated that it was in support of reinforcing MAP and the features of MAP. It also submitted that arbitration does not work.

Zambia. Reinforcing MAPS through the protocols and best practices is commendable. MAPs have been one of those mechanisms that appear to be inclusive, collaborative, and responsive to resource or capacity constraints. For this reason, we propose that it should be among the core mechanisms. Regarding the possible design features of MAPS, timelines need to be included as this mechanism is developed. On question (k), Zambia agreed with the African Group not to include arbitration in the dispute resolution mechanism because the African Group's participation in the process has not been favourable. The UN regular review would be helpful in ensuring that whatever design features are adhered to. The UN should play an active role in ensuring countries adhere to the MAP procedures.

Day 8: Wednesday 19 November 2025

The discussion from the previous day on questions (i)-(l) was put to stakeholders.

The African Union stated that a mechanism to serve as a backstop to the Mutual Agreement Procedure (MAP) was necessary and noted that the role of the UN in this regard was already reflected in the Terms of Reference, which mentioned such a mechanism in paragraph 13.

After submissions from stakeholders, the Committee was invited to discuss:

(n) whether other types of databases could be considered, such as databases compiling bilateral APAs or MAP cases.

Database Governance, Access, and Confidentiality

Nigeria, with respect to questions (m) and (n), holds the view that having the relevant structure to manage each of the processes emanating from the framework and protocols should be a concern at this stage. The mandate for each of the subsidiary bodies to be created under the framework should be where we begin to discuss what the subsidiaries will do. Discussing this under Protocol 2, governing bodies and their mandates should be addressed within the framework. It would be more straightforward to examine each body and allow them to choose the methodology and what they consider useful for their mandate. Questions (m) and (n) should be discussed under the framework convention and not under the protocol.

Zambia supported efforts to develop an accessible database, emphasising that improving access to transfer pricing information would help prevent tax disputes. In this regard, Zambia highlighted the potential benefits of creating a UN transfer pricing database accessible to all countries, noting that the costs associated with updating the database could be managed through a pooled purchasing approach, which might prove cost-effective. However, Zambia raised a major concern regarding the limited availability of data in existing databases, particularly data reflecting circumstances relevant to the African environment, as comparables were difficult to find. As a result, the current databases had not been very helpful. Zambia stressed the importance of enhancing transparency and ensuring that relevant data were made available. Finally, with respect to question (n), Zambia noted that it would be useful to have information on Advance Pricing Agreements (APAs) and Mutual Agreement Procedures (MAPs).

In Algeria access to databases was identified as an essential issue, particularly for African countries, due to both the costs involved and the limited availability of information. Consequently, Algeria welcomed the idea of a UN-managed database, regardless of the approach taken. The database should include information on Advance Pricing Agreements (APAs) and Mutual Agreement Procedures (MAPs) to enable states to settle disputes effectively. Moreover, such a database could help identify recurring issues and gaps in capacity building. Strengthening access to the database was therefore considered a crucial measure to enhance international tax cooperation.

Kenya emphasised that comparables in cross-border services were important and noted that UN management of databases would help elevate the credibility and neutrality of how such data were handled. In this context, Kenya noted that existing databases were skewed, possibly due to the reporting frameworks currently in place, and that commercial databases tended to be biased toward certain regions. Consequently, a UN-managed database was viewed as an opportunity to better reflect a wide range of entities and transactions. However, Kenya also noted that access to databases was often hindered by financial costs.

Uganda concurred with the submissions made by Kenya and Zambia regarding the UN-managed database. It emphasised that the database should be managed in partnership with Member States, particularly through regional economic blocs, to leverage existing data collection and management infrastructure. With respect to question (n), Uganda noted that including court decisions in the database would be helpful, as domestic courts could then use these decisions as precedents. Additionally, Uganda highlighted that the confidentiality of bilateral APAs and MAP cases should be a topic of discussion within the Committee.

Sierra Leone supported the establishment of a UN-managed database, particularly one that would promote transparency, comparability of tax rules, and improved tax administration. However, it emphasised the need for governance arrangements that ensure equal participation and balanced representation from regional groups, with decisions on the database’s scope, categories, and updates to be taken by Member States. Sierra Leone further stressed the importance of operational guidelines and defined procedures for data submission, verification, and user access in order to ensure predictability for smaller jurisdictions. The country recommended that the database be funded by multiple partners, allowing optional contributions but not expecting payments from low-income states. Management of the database should fall under the UN Secretariat, supported by specialised tax data units, and capacity-building support should be integrated. Additionally, Sierra Leone proposed periodic workshops to ensure that the data platform remains relevant and effective.

Morrocco emphasised that the UN-managed database should be carefully designed to ensure sustainability, effectiveness, and accessibility. Regarding financial implications, it noted that considerations should include the costs of initial database development and population, ongoing data collection and updates, as well as quality control and verification. On responsibilities, Morocco recommended the establishment of a Technical Advisory Committee and suggested that voluntary data submission should be considered. Additionally, it stressed the importance of strict confidentiality measures, including user confidentiality agreements.

Algeria emphasised that the compilation and access to data should be carried out in a manner that respects confidentiality requirements. It further noted that it was important to identify which information could be shared, as had been proposed by other Member States.

The informal session of the Intergovernmental Negotiating Committee was adjourned until February 2026.

About the African Civil Society Working Group on the UN Tax Convention

The Working Group comprises African-based civil society organisations coordinated by Tax Justice Network Africa, with the aim of promoting a UN Tax Convention that promotes African interests and enables the mobilisation of resources for the delivery of public services and social and economic rights of the African people.

For more information about the Working Group, please email: emuendo[@]taxjusticeafrica.net

Updates from the Third Session of the historic Intergovernmental Negotiating Committee (INC) on the United Nations Framework Convention on International Tax Cooperation

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