Vietnam and the Organization for Economic Co-operation and Development (OECD) signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAAC) in Paris on March 22.

By signing the Convention, the world’s most wide-reaching international treaty for multilateral tax cooperation, Vietnam joins international efforts towards greater tax cooperation and the exchange of information and further strengthens the reach of the Convention in Asia.

The signing is set to pave the way for the country to engage in the exchange of information with 146 other jurisdictions, including all major financial centers. These exchange relationships will be added to over 9,000 exchange relationships that are already in place under the terms of the Convention.

The Convention enables jurisdictions to engage in a wide range of mutual assistance in tax matters, including the exchange of information upon request, spontaneous exchanges, automatic exchanges, tax examinations abroad, simultaneous tax examinations, and assistance in tax collections. It guarantees extensive safeguards on protecting taxpayer rights.

It is the primary instrument for the swift implementation of the Standard for Automatic Exchange of Financial Account Information in Tax Matters (CRS). Developed by the OECD and G20 countries, the CRS enables more than 110 jurisdictions to automatically exchange offshore financial account information.

Beyond the exchange of information on request and the automatic exchange pursuant to the standard, the Convention is also a powerful tool in the fight against illicit financial flows and is a key instrument for the implementation of the transparency standards within the work of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS).

The convention has drawn the participation of 147 countries to date.