This paper examines whether a taxpayer should have “standing” in international dispute resolutions. To answer this question the primary task is to identify the nature of international taxation. In other words, this paper discusses how to classify the field of international taxation. Is it part of public international law, private international law (i.e., conflict of laws), national (domestic) law, or is it a hybrid field that requires specific attention? Making this distinction is vital for resolving disputes when a taxpayer is taxed twice for cross-border transactions in cases where the double tax convention is unclear and both contracting states claim full or partial tax on accrued income.

In 1924, the Permanent Court of International Justice defined dispute as “disagreement on a point of law or fact, a conflict of legal views or of interests between two persons.” In the case brought before the Court in 1924, it determined that the dispute started between an individual and a state, but then the individual’s government “took up the case. The dispute then entered upon a new phase; it entered the domain of international law, and became a dispute between two States.” If we analogize that case to a tax case derived by a cross-border transaction, there is no doubt that we have a dispute — a dispute on tax liability. But there are still two lingering doubts. First, is it an international dispute? And second, who are the parties to it? If one examines the current mechanisms available in the OECD Model Tax Convention for resolving double taxation disputes, one realizes that the taxpayer’s standing is somewhat ambiguous. In order to clarify this ambiguity we need to address the question of categorizing the conflict as a national or international one.

The question at stake is whether a taxpayer should be a party to the dispute resolution process. In this paper, the cases cited are limited to where double tax treaties apply. I reserve the cases where they are inapplicable to further discussion.

Part I highlights the tax complexity arising from cross-border transactions. Since the article focuses on OECD Model dispute resolution mechanisms, Part II briefly introduces the model’s history and its official aims. Part III discusses the available dispute resolution mechanism in the OECD Model — the Mutual Agreement Process (MAP) and Arbitration. Part IV reviews the hybrid elements of international taxation. This paper suggests that international taxation has both national and international characteristics. This hybrid nature is the basis of the discussion in Part V: after identifying the parties to the international tax dispute, this paper suggests two solutions to the research question — the apparent and normative solutions. In the former, a taxpayer should have standing in the international dispute, though recall that this solution is not based on normative grounds. The normative rationale introduces the equity principle whereby taxpayers should have no official role in resolving the dispute. Finally, this paper offers a brief recommendation in Part VI.