Mauritius has signed the Multilateral Convention to Implement Tax Treaty Related Measures to prevent Base Erosion and Profit Shifting (MLI).

Once ratified, the MLI will affect as many as 23 tax treaties entered into by this island nation, which has been an important jurisdiction for routing investments into India. Interestingly, Mauritius has not put the existing DTAA with India under the list of covered agreements for the MLI.

This could mean that the MLI will have no impact on the India-Mauritius DTAA, which was recently revised, for now, say tax experts.

For Mauritius, the MLI was signed on Wednesday at the OECD headquarters in Paris by Mahess Rawoteea of the Ministry of Finance and Economic Development. The MLI was signed in the presence of Douglas Frantz, OECD Deputy Secretary-General.

Mauritius has also reaffirmed that it will implement the minimum standards outlined in the OECD/ G20 BEPS plan by 2018. It has committed to modify its remaining tax treaties through bilateral negotiations.

The MLI is a legal instrument designed to prevent Base Erosion and Profit Shifting (BEPS) by multinational enterprises.

BEPS refers to tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations.

The MLI allows jurisdictions to transpose results from the OECD/ G20 BEPS project, including minimum standards to implement in tax treaties, to prevent treaty abuse and "treaty shopping", into their existing networks of bilateral tax treaties in a quick and efficient manner.

It was developed through inclusive negotiations involving more than 100 countries and jurisdictions, under a mandate delivered by G20 Finance Ministers and Central Bank Governors at their February 2015 meeting.

The OECD is the depository of the MLI and is supporting Governments in the process of signature, ratification and implementation.