On February 6, 2015, the OECD published the Guidance on the Implementation of Transfer Pricing Documentation and Country-by-Country Reporting. This document is a follow-up for Action 13 of the BEPS project, published in September 2014. This page provides for an overview of the OECD Country-by-Country measures that have been announced so far.
Implementation of Country-by-Country Reporting
The main topics of the CbC-reporting implementation are:
- Only the MNE’s ultimate parent company should file the global CbC-report, operating countries will receive this information through automatic exchange;
- MNE’s with a revenue below EUR 750M are exempt from CbC-reporting.
Please find below information on the key items as addressed by the OECD.
- The OECD recommends implementation of CbC-reporting for fiscal years starting on or after January 1, 2016
- MNE’s will be given 12 months to file the CbC-reporting, after the close of the fiscal year
- This means that the first MNE’s filing CbC-reporting will be by December 31, 2017
MNE’s in scope for CbC-reporting
- CbC-reporting should be filed each year, unless the exception below applies
- Annual consolidated revenue of less than EUR 750 million (or equivalent) in the immediately preceding year (e.g. if revenue in 2015 is below EUR 750M, no CbC filing is required in 2016)
Conditions for obtaining and using CbC-reporting
- Confidentiality – jurisdictions should have legal protections and enforcements in place to protect the filed CbC-report
- Consistency – jurisdictions should implement legal requirements for MNE’s ultimate parent company to prepare and file the CbC-reporting based on the standard template as published in September 2014
- Appropriate use – the CbC-reporting should only be used for high-level tax assessments
Framework & Implementation
- Ultimate parent companies are required to file the CbC-reporting in the country where they are based
- Information should be exchanged automatically with operating countries of the MNE
- If no information can be exchanged (due to any reason) by the jurisdiction of the ultimate parent company, the next tier parent company becomes responsible, or local filing should be applied
The OECD will develop an implementation package for jurisdictions and arrangements for automatic exchange.
Country-by-country model template (1)
Overview of allocation of income, taxes and business activities by tax jurisdiction
Country-by-country model template (2)
List of all the Constituents Entities of the MNE group included in each aggregation per tax jurisdiction