Book excerpt: This dissertation investigates the importance of the nexus approach to international taxation. The nexus approach was first adopted in Action 5 of the G20/OECD Base Erosion and Profit Shifting (BEPS) Project and has since been implemented as a minimum standard through the BEPS Inclusive Framework. It requires a country to apply preferential taxation of income from patent and patent-like intellectual property (IP) under patent box regimes only to the amount that has a nexus with that country. Drawing on the existing literature and a case study of 10 countries that have adopted the nexus standard, this dissertation makes two central claims. First, in term of the technical nature, the nexus standard is more effective than earlier, failed OECD harmful tax competition measures because it sets minimum standard, developed by consensus, and effectively implemented, to regulate international tax competition for patent income. Professor Dagans tax competition theory also supports its effectiveness in combating harmful tax competition. Second, in term of the legal nature, the nexus standard is a unique category of soft law in international taxation because it has a built-in enforcement mechanism. The dissertation seeks to contribute to the literature on international tax competition and soft law in international taxation. First, it confirms Professor Dagans tax competition theory which seeks to solve harmful tax competition problem. Dagans theory posits that a common and transparent standard can overcome market failures characteristic of decentralized tax competition, which are inherently harmful. The nexus standard is such a common and transparent tax competition standard that has proven to be effective. It also advances her theory by showing the feasibility of setting up such a standard through soft law strategy. Second, this dissertation contributes to the literature on soft law in international taxation by demonstrating that soft law can induce compliance from countries and eliminate harmful tax competition in the same way that hard law might induce compliance. More importantly, it shows for soft law to have coercive force in international taxation especially in areas with obvious distribution consequences, both the process of creating the instrument and the mechanisms for monitoring compliance are critical.