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May 15, 2026

Article 2 outlines the primary objectives of Decree-Law No. 11 of 2024, focusing on the implementation of a global minimum tax rate for domestic top-up purposes. It ensures that Multinational Enterprise Groups in Bahrain are subject to a domestic top-up tax consistent with the OECD Pillar Two Model Rules. The Article emphasises establishing a safe harbour for qualified domestic top-up taxes to streamline compliance for MNEs. Furthermore, it mandates that any interpretation or application of this Law must take into account the guidelines, commentary, and rules issued by the OECD regarding base erosion and profit shifting (BEPS) to maintain international alignment.

Chapter 1 - Preliminary Provisions

Article 2 - Objectives of the Law

The following objectives shall be considered when applying or interpreting the provisions of this Law:
1. Ensuring the application of a global minimum rate for a domestic top-up tax on Entities of Multinational Enterprise Groups located in the Kingdom in addition to the implementation and administration of that Tax in a manner that provides for outcomes that are consistent with the Model Rules.
2. Establishing the principle of a safe harbor for the qualified domestic top-up tax to facilitate compliance by Multinational Enterprise Groups located in the Kingdom.
The rules and guidance issued by the OECD in respect to the erosion and shifting of profits, and specifically the Model Rules, shall be taken into consideration when applying or interpreting the provisions of this Law, necessary regulations, or decisions to implement its provisions.