This chapter examines how the European Union, despite positioning itself as a global leader in combating tax avoidance, has become a central facilitator of corporate tax arbitrage. Through a combination of legal fragmentation, market integration, and judicial rulings favouring corporate mobility, the EU has unintentionally fostered a ‘law market’ enabling multinational corporations (MNCs) to exploit regulatory and tax differentials across member states. The chapter traces how European conduit jurisdictions – particularly the Netherlands, Ireland, Luxembourg, and Switzerland – emerged as key nodes in global tax planning strategies, especially for US-based MNCs. Drawing on evidence from the CORPLINK study and UNCTAD, it shows how these jurisdictions act as hubs for intermediary subsidiaries, structuring global investment chains that reroute value creation, treasury functions, and tax obligations through Europe while bypassing both source and residence countries. Moreover, the chapter highlights how the EU’s internal legal order – especially the subsidiarity principle and European Court of Justice rulings -accelerated the ‘Delaware effect’ of regulatory competition. The paradox is stark: while promoting tax reform and transparency, the European Union has simultaneously entrenched a structural role for European states as gatekeepers of global arbitrage, particularly in how foreign direct investment reaches and exploits developing economies.

This chapter explores a largely overlooked dimension of jurisdictional arbitrage: the manipulation of corporate reporting and disclosure practices at the subsidiary level. While much of the literature focuses on multinational corporations (MNCs) as unified entities, this chapter demonstrates that opacity is often engineered through the dispersed structure of CCMCEs. Drawing on data from the CORPLINK project, it analyses how MNCs exploit jurisdictional inconsistencies in disclosure rules to limit financial transparency, particularly in OFCs. Key strategies include the use of exempted companies, off-balance-sheet entities, disappearing or floating subsidiaries, and shell companies mimicking dormancy. These techniques allow firms to circumvent consolidated reporting obligations, distort public and regulatory perceptions, and obscure the allocation of revenues and profits. Comparative data on independent versus integrated energy firms further illustrates how these practices are unequally distributed and systematically deployed. The chapter calls attention to the inadequacy of current regulatory frameworks and urges international action to standardize disclosure quality and reduce informational blind spots. By revealing how MNCs ‘tell without telling’, the chapter advances our understanding of corporate opacity as a strategic, institutionalized practice deeply embedded in global corporate structuring.

This chapter explores the evolution and techniques of corporate tax arbitrage, focusing on how multinational corporations (MNCs) exploit the structural features of the international tax regime. It traces the origins of the system to the 1928 League of Nations framework, which privileged source and residence taxation while neglecting valuation and the treatment of intangible assets. This omission, combined with the legal autonomy granted to subsidiaries within centrally coordinated multi-corporate enterprises, created enduring arbitrage opportunities. The chapter analyses how firms leverage intangible assets, ownership structures, and corporate residency rules to reallocate profits across jurisdictions, exploiting regulatory mismatches. It highlights the role of offshore financial centres (OFCs), intermediary subsidiaries, and hybrid instruments in enabling tax avoidance. Case studies – such as Apple’s use of stateless entities and Amazon’s transfer of losses via Luxembourg – illustrate how MNCs circumvent tax rules through entity design, subsidiary chaining, and strategic use of global value chains. Using new evidence from the CORPLINK study, the chapter estimates that although OFC intermediaries represent only 1.7 per cent of subsidiaries among the world’s top 100 non-financial firms, they control up to two-thirds of group revenues. Tax arbitrage is shown to be systemic, not exceptional, and embedded in contemporary corporate structures.

This chapter explores the intersection of jurisdictional arbitrage and geopolitics by examining how US-based CCMCEs structure their domestic and international operations. Drawing on CORPLINK data from the world’s top 100 non-financial firms, it identifies a distinct bifurcation in US corporate structuring: minimal use of intermediary or splitter subsidiaries within the United States and extensive use of such structures abroad. While domestic operations leverage Delaware’s legal infrastructure without intermediaries, international operations are frequently routed through offshore financial centres, enabling regulatory and tax arbitrage. The chapter argues that this structural asymmetry reflects more than corporate tax planning – it reveals how arbitrage is embedded in broader geopolitical strategies. Through permissive laws, ambiguous enforcement, and selective participation in global tax transparency initiatives, the United States may tacitly enable its firms to exploit foreign jurisdictions, thus reinforcing their global competitiveness. Though indirect, this alignment of corporate and geopolitical interests positions arbitrage as a quasi-strategic tool of US influence.