The agreement was signed in Majuro by the Marshall Islands Acting Finance Minister, Brenson Wase and Australia's Ambassador to the Federated States of Micronesia, Palau and the Marshall Islands, Susan Cox.

The Marshall Islands was – on 10 May – classified by the OECD as a jurisdiction that has committed to the internationally agreed tax standard, but has not yet substantially implemented it. Dozens of jurisdictions around the world have been signing such agreements as major governments have stepped up pressure against so-called offshore tax havens.

In addition to the TIEA, Australia and the Marshall Islands also signed an Additional Benefits Agreement. The ABA will establish an administrative mechanism to resolve transfer pricing disputes between taxpayers and the revenue authorities of Australia and the Marshall Islands and eliminate double taxation of certain income derived by retirees, government employees and students.

“The agreements will enter into force after Australia and the Marshall Islands have completed their respective domestic requirements,” a statement from the Australian government said.