GloBE Rules and Legal Certainty: When Fiscal Policies Replace Legal Principles
GloBE Rules and Legal Certainty: When Fiscal Policies Replace Legal Principles

Summary/Abstract: This contribution aims to evaluate how Pillar Two rules comply with the requirements of the principle of legal certainty. Legal certainty works as a principle that should guide the interpretation and application of the law. Regardless of the extreme positions that deny legal certainty (American realism), the literature stresses that legal certainty requires that the rights and obligations of the citizens must be secured by law in a predictable legal environment. Since some uncertainty is inevitable in our legal systems, recourse to legal principles is crucial to guarantee a predictable legal environment and reduce the margin of indeterminacy that every legal system produces. In complex regulatory scenarios, legal principles fit better than rules to create legal certainty due to the need to be flexible and responsive to economic, social, technical, and cultural changes. Yet, the GloBE Rules respond to fiscal policy goals rather than legal principles. The GloBE Rules are unlikely to be assessed in the light of legal principles like proportionality, prevention of anti-abuse behaviours, etc. Only linguistic interpretation in combination with fiscal goals are the hermeneutic tools of legal interpreters. Hence, the judge will be confronted with interpreting divergent policy goals, thereby jeopardizing a coherent and uniform application of Pillar Two by domestic courts. Legal certainty is sacrificed for the sake of achieving policy goals.

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