The OECD released the final piece of implementation guidance on country-by -country reporting. The implementation package elaborates on the framework for the government-to-government exchange procedures.
The implementation package is the final measure of the complete Country by Country Reporting framework developed by the OECD, and already endorsed by a number of countries, including the UK, the US, Spain and Australia.
For a quick reminder on what country-by-country reporting (action 13 of the BEPS proposals) entails, you can watch our three minute, bite sized webcast here.
From the latest OECD publication, there are two components to the implementation package:
Firstly there is suggested domestic legislation which needs to be adapted into local law. The suggested legislation covers how governments can enact the CbyC Reporting requirement for sizeable multinationals headquartered in their jurisdictions. This suggested domestic legislation focuses on the more complex mechanisms whereby governments in subsidiary jurisdictions can access the CbyC Reports in situations where the information is not required to be filed in or being passed on by the parent entity jurisdiction.
Secondly, the package details a competent authority model to facilitate the exchange of information via three different mechanisms:
While this implementation guidance is useful for business to understand, the most significant development will come when jurisdictions such as Ireland issue draft versions of their own domestic tax law. It is expected that the 2015 Finance Bill (due to be published in late October) will contain some measures in this regard.
If you would like to discuss this or any other BEPS related matters, please do not hesitate to contact a member of the Transfer Pricing team directly.