Conflicts due to the autonomous methods used by Member States for the tax classification of companies or partnerships established under the private law of other Member States can give rise to e DEGREES-hybride DEGREES-- entities and lead to double taxation or double nontaxation. As a consequence, market participants in the EU internal market are sometimes confronted with negative effects on cross-border activities or with incentives to use such mismatches in tax planning structures. Given major progress in this area at both the EU and the OECD, the time is right to formalize a truly comprehensive solution to this persistent problem. This detailed analysis, ranging from specific national law developments to solidly grounded recommendations, offers unprecedented guidance on the way forward.