The German government has proposed draft measures that would limit the deduction of royalty payments to related parties if the income is eligible for the benefits of an IP regime that is not compliant with nexus approach developed as part of BEPS Action 5. The nexus approach essentially requires that the benefits received under a regime be aligned with the actual activities performed by the taxpayer claiming the benefits. As proposed, the measure would apply for payments made after 31 Decembe…