Jeffrey Tebbs discussed tax legislation pending in the U.S. Senate, which would reduce barriers to cross-border investment with Taiwan. The first component of the legislation is the United States-Taiwan Expedited Double-Tax Relief Act, which would amend U.S. domestic law to reduce U.S. tax on certain income earned by qualified residents of Taiwan. That relief would only take effect when Taiwan enacts reciprocal benefits for income earned by U.S. residents from investments in Taiwan. Because the proposal is different than a treaty, if there's an issue with how the Taiwanese tax authority is applying its changes to domestic law, the only recourse for a U.S. company investing in Taiwan will be with the local authority, Tebbs said. There won't be an ability to talk to the U.S. competent authority office and initiate the Mutual Agreement Procedure (MAP) process, he noted. "If it turns out that the benefits aren't truly reciprocal, there's some problem with how the Taiwanese authority is applying this, you don't have the normal mechanism for resolving that dispute," Tebbs said. "I'd say that's a key difference." The second component of the proposed legislation is the United States-Taiwan Tax Agreement Authorization Act. The idea behind that aspect of the legislation is that, through a congressional executive agreement, the U.S. can negotiate a comprehensive agreement with Taiwan, according to Tebbs. The legislation requires U.S. negotiators to use the 2016 model treaty without diverging from it, but there are many ways in which negotiators might not want to follow that in all cases, he said. "This legislation is quite prescriptive," Tebbs acknowledged. "I'm not quite sure how that would play out in practice in a negotiation."