Recently, there have been two important developments in the co-ordination between countries of policies concerning the taxation of international flows of capital. In December 1997, the European Union Council of Ministers agreed a “Code of Conduct” concerning business tax measures. And in April 1998, the OECD agreed recommendations to counter “harmful tax competition”. These initiatives have made considerable progress since they were introduced. They have much in common – the central feature of each is an attempt to distinguish forms of tax competition, or tax regimes, which are “harmful”. The definitions of what is harmful differs slightly, but a crucial feature is that neither approach considers low tax rates per se to be harmful.