Brussels, 08 May 2017
Interinstitutional files:
2016/0107 (COD)
WK 5230/2017 INIT
LIMITE
DRS
WORKING PAPER
This is a paper intended for a specific community of recipients. Handling and
further distribution are under the sole responsibility of community members.
MEETING DOCUMENT
From:
General Secretariat of the Council
To:
Working Party on Company Law (CBCR)
N° prev. doc.:
ST 15243/16
N° Cion doc.:
ST 7949/16
Subject:
Comments received from delegations on CBCR Proposal
Delegations will find in Annex comments received from delegations after the Working Party meeting on
29 March 2017.
WK 5230/2017 INIT
LIMITE
EN
ANNEX
Drafting suggestions
Comments
2014/0121 (COD)
DE:
GER upholds its fundamental scrutiny
reservation. GER still does not have a position
whether we can accept the proposal.
Proposal for a
DIRECTIVE OF THE EUROPEAN PARLIAMENT AND
OF THE COUNCIL
amending Directive 2013/34/EU as regards
disclosure of income tax information by certain
undertakings and branches
(Text with EEA relevance)
THE EUROPEAN PARLIAMENT AND THE COUNCIL
OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of
DE:
the European Union, and in particular Article 50(1)
thereof,
See above.
LU:
In our view the appropriate legal basis remains the
one of Article 115 TFEU. The legal basis of the
proposal should be aligned with its content which is
referring to the Directive 2011/16/EU as amended,
based on the work of the OECD in tax matters.
SE:
The Swedish position on the Commission’s proposal
on public Country by Country reporting in the
Accounting Directive is:
-
that it is important to protect the principle
1
link to page 3
that tax matters shall be decided with unanimity
-
that it also is important to safeguard that tax
provisions are not included in EU acts other than
those relating to tax, and
- that it is of the outmost importance not to
jeopardise what has been achieved within the
OECD, and that more countries decide to sign up to
the global standard.
-
that we share the opinion of the Legal
Service that the proposal must be based on Article
115 (i.e. unanimity) since the proposal relate to
fiscal provisions.
Having regard to the proposal from the European
Commission,
After transmission of the draft legislative act to the
national parliaments,
Having regard to the opinion of the European
Economic and Social Committee
1,
Acting in accordance with the ordinary legislative
procedure,
Whereas:
(1) In recent years, the challenge posed by
corporate income tax avoidance has increased
considerably and has become a major focus of
concern within the Union and globally. The
European Council in its conclusions of 18 December
2014 acknowledged the urgent need to advance
efforts in the fight against tax avoidance both at
global and Union level. The Commission in its
communications entitled ‘Commission Work
Programme 2016 - No time for business as usual’
1
OJ C , , p. .
2
and ‘Commission Work Programme 2015 - A New
Start’ identified as a priority the need to move to a
system whereby the country in which profits are
generated is also the country of taxation. The
Commission also identified as a priority the need to
respond to our societies’ call for fairness and tax
transparency.
(2) The European Parliament in its resolution of 16
SE:
SE:
December 2015 on bringing transparency,
coordination and convergence to corporate tax
(2) The European Parliament in its resolution of 16
We suggest that the deleted text should be in the
policies in the Union acknowledged that increased
December 2015 on bringing transparency,
directive.
transparency in the area of corporate taxation can
coordination and convergence to corporate tax
improve tax collection, make the work of tax
policies in the Union acknowledged that increased
authorities more efficient and ensure increased
transparency in the area of corporate taxation can
public trust and confidence in tax systems and
improve tax collection, make the work of tax
governments.
authorities more efficient and ensure increased
public trust and confidence in tax systems and
In parallel to the work undertaken by the
governments.
Council to fight corporate income tax
avoidance, it is necessary to enhance public
scrutiny of corporate income taxes borne by
multinational undertakings carrying out
activities in the Union, as this is an essential
element to further foster corporate
responsibility to contribute to the welfare of
our societies, to promote a better informed
public debate and to regain the trust of
citizens of the Union in the fairness of the
national tax systems. Such public scrutiny can
be achieved by means of a report on income
tax information, irrespective of where the
ultimate parent undertaking of the
multinational group is established.
(3) Following the European Council conclusions of
22 May 2013, a review clause was introduced in
Directive 2013/34/EU of the European Parliament
and of the Council requiring the Commission to
3
consider the possibility of introducing an obligation
on large undertakings of additional industry sectors
to produce, on an annual basis, a country-by-
country reporting taking into account the
developments in the Organisation for Economic
Cooperation and Development (OECD) and the
results of related European initiatives.
(4) Calling for a globally fair and modern
international tax system in November 2015, the
G20 endorsed the OECD ‘Action Plan on Base
Erosion and Profit Shifting’ (BEPS) which aimed at
providing governments with clear international
solutions to address the gaps and mismatches in
existing rules which allow corporate profits to shift
to locations of no or low taxation, where no real
value creation may take place. In particular, BEPS
Action 13 introduces a country-by-country
reporting by certain multinational undertakings to
national tax authorities on a confidential basis. On
27 January 2016, the Commission adopted the
‘Anti-Tax Avoidance Package’. One of the
objectives of that package is to transpose into
Union law, the BEPS Action 13 by amending Council
Directive 2011/16/EU.
(5) Enhanced public scrutiny of corporate income
taxes borne by multinational undertakings carrying
out activities in the Union is an essential element to
further foster corporate responsibility, to contribute
to the welfare through taxes, to promote fairer tax
competition within the Union through a better
informed public debate and to restore public trust
in the fairness of the national tax systems. Such
public scrutiny can be achieved by means of a
report on income tax information, irrespective of
where the ultimate parent undertaking of the
multinational group is established.
4
(6) The public should be able to scrutinise all the
LU:
activities of a group when the group has certain
establishments within the Union. For groups which
As a starting point, we are in favour of the wording
carry out activities within the Union only through
that has been used in DAC 4, which allows the
subsidiary undertakings or branches, subsidiaries
entity that cannot obtain all required information
and branches should publish and make accessible
from its ultimate parent established in a third
the report of the ultimate parent undertaking
to
country only to file the information which is
the extent that the requested information is
available and notify that the ultimate parent has
available to the subsidiary or branch. If the
refused to make the necessary information
requested information is not available the
available. The concept of “comply and explain” in
subsidiary or branch should explain in the
case the information is not available is a minimum
report the reasons of this omission. However
that we could accept.
for reasons of proportionality and effectiveness, the
obligation to publish and make accessible the
report should be limited to medium-sized or large
subsidiaries established in the Union, or branches
of a comparable size opened in a Member State.
The scope of Directive 2013/34/EU should
therefore be extended accordingly to branches
opened in a Member State by an undertaking which
is established outside the Union.
(6a) Multinational groups, and where
LU:
relevant, non-affiliated undertakings, should
provide the public with a report on income tax
Assuming that a non-affiliated undertaking is an
information when they exceed a certain size
independent company which is not a part of a
over a period of the last two consecutive
group and which is not controlled and has no
financial years, depending on the
subsidiaries, the proposal goes beyond the scope of
consolidated revenue of the group or the
Action 13 of OECD and DAC4. Luxembourg does
revenue of the non-affiliated undertaking.
not support extending the scope beyond what is
Given the wide array of accounting
required under Action 13 of OECD and DAC4.
frameworks with which financial statements
may comply, such revenue should be defined
as the net turnover for undertakings falling
within the scope of this Directive. For other
undertakings the revenue should be assessed
in accordance with the financial reporting
framework on the basis of which these
5
financial statements are prepared.
SE:
SE:
(6b) At the same time it is stressed that, as
We suggest that a new 6b) is introduced in the
concluded by the G20 and the OECD, country-
directive. It explains that you cannot draw definite
by-country reports will be helpful for high-
conclusions just from a Country-by-Country Report.
level transfer pricing risk assessment
purposes only. The information in the
Country-by-Country Report does not
constitute conclusive evidence that transfer
prices are or are not appropriate and that
information should not be used as a
substitute for a detailed transfer pricing
analysis of individual transactions and prices
based on a full functional analysis and
comparability analysis.
(7) In order to avoid double reporting for the
banking sector, ultimate parent undertakings
and
non-affiliated undertakings which are subject to
Directive 2013/36/EU of the European Parliament
and of the Council and which include in their report
prepared in accordance with Article 89 of Directive
2013/36/EU all its activities and
, where
appropriate, all the activities of its affiliated
undertakings included in the consolidated financial
statements, including activities not subject to the
provisions of Chapter 2 of Title 1 of Part Three of
Regulation (EU) No 575/2013 of the European
Parliament and of the Council , should be exempted
from the reporting requirements set out in this
Directive.
(8) The report on income tax information should
DE:
provide information concerning all the activities of
an undertaking or of all the affiliated undertakings
It should be clarified what “depending on the
of a group controlled
consolidated by an ultimate
circumstances” exactly means.
parent undertaking
or, depending on the
6
circumstances, concerning all the activities of
a non-affiliated undertaking. The information
should be based on the reporting specifications of
SE:
BEPS’ Action 13 and should be limited to what is
SE:
necessary to enable effective public scrutiny, in
The recital should be clear that the requirements in
order to ensure that disclosure does not give rise to The definitions and requirements in Chapter 10a do this proposal does not affect the requirements of
disproportionate risks or disadvantages
for
not affect the requirements of annual reports or
annual reports or consolidated accounts.
undertakings. For this reason, the list of
consolidated accounts
information is exhaustive. The report should
also include a brief description of the nature of the
activities. Such description might be based on the
categorisation provided for in table 2 of the Annex
III of Chapter V of the OECD “Transfer Pricing
Guidelines on Documentation”.
(8a) In order to avoid administrative burden,
DK:
DK:
when preparing a report on income tax
information in compliance with this Directive,
(8a) In order to avoid administrative burden,
We believe that it is unnecessary to state that the
undertakings should be entitled to prepare
when preparing a report on income tax
undertaking can provide more information than
the information on the basis of the reporting
information in compliance with this Directive,
required in the proposal. As we understand the
specifications laid down in Annex III, Section
undertakings should be entitled to prepare
proposal it outlines minimum requirements. See
III, parts B and C of Council Directive
the information on the basis of the reporting
below also the draft proposal to delete Article 48 c
2011/16/EU. For this reason, the report
specifications laid down in Annex III, Section
(4)
should specify the reporting framework used.
III, parts B and C of Council Directive
The report should
might in addition include an
2011/16/EU. For this reason, the report
overall narrative providing explanations in case of
should specify the reporting framework used.
material discrepancies at group level between the
The report should
might in addition include an
amounts of taxes accrued and the amounts of
overall narrative providing explanations in case of
taxes paid, taking into account corresponding
material discrepancies at group level between the
amounts concerning previous financial years.
amounts of taxes accrued and the amounts of
taxes paid, taking into account corresponding
LU:
amounts concerning previous financial years.
We support the possibility of a reporting based on
the DAC4. We suggest however to amend the
reference to the DAC to‘
Council Directive
2011/16/EU as amended’.
7
(9) In order to ensure a level of detail that enables
DK:
DK:
citizens to better assess the contribution of
multinational undertakings to welfare in each
(9) In order to ensure a level of detail that enables The proposed text is a draft proposal merely to
Member State, the information should be broken
citizens to better assess the contribution of
specify
down by Member State. Moreover, information
multinational undertakings to welfare in each
concerning the operations of multinational
Member State, the information should be broken
• that this part of the recital is concerning third
enterprises should also be shown with a high level
down by Member State. Moreover, information
country tax jurisdictions, and
of detail as regards certain tax jurisdictions which
concerning the operations of multinational
pose particular challenges. For all other third
enterprises should also be shown with a high level
• that it is also allowed to disclose
country operations, the information should be
of detail as regards certain third country tax
disaggregated information.
given in an aggregate number.
jurisdictions which pose particular challenges. For
all other third country operations, the information
should can be given in an aggregate number.
(10) In order to strengthen responsibility vis-á-vis
DK:
third parties and to ensure appropriate governance,
the members of the administrative, management
The recital should be aligned with Article 48b (3).
and supervisory bodies of the ultimate parent
undertaking
or non-affiliated undertakings
which is
are established within the Union and
which has
have the obligation to draw up, publish
and make accessible the report on income tax
information, should be collectively responsible for
ensuring the compliance with these reporting
obligations. Given that members of the
administrative, management and supervisory
bodies of the subsidiaries which are established
within the Union and which are controlled by an
ultimate parent undertaking established outside the
Union or the person(s) in charge of carrying out the
disclosures formalities for the branch may have
limited knowledge of the content of the report on
income tax information prepared by the ultimate
parent undertaking
or may have limited ability
to obtain such information from their ultimate
parent undertaking, their responsibility to publish
and make accessible the report on income tax
information should be limited.
8
(11)
To ensure public awareness on the
AT:
AT:
compliance of the reporting obligations by the
relevant undertakings, To ensure that cases of
(11)
To ensure public awareness on the
Suggestion to align the text with the compromise
non-compliance are disclosed to the public,
compliance of the reporting obligations by the proposal to Art 48d.
statutory auditor(s) or audit firm(s) should check
relevant undertakings, To ensure that cases of
state whether the report on income tax
non-compliance are disclosed to the public,
information has been submitted and presented
statutory auditor(s) or audit firm(s) should check
published in accordance with the requirements of
state whether the report on income tax
this Directive and made accessible on the relevant
information has been submitted and presented
undertaking’s website or on the website of an
published in accordance with the requirements of
affiliated undertaking
, within the time limits
this Directive and made accessible on the relevant
established by this Directive.
undertaking’s website or on the website of an
affiliated undertaking
or on the website of the
register, within the time limits established by
this Directive.
DE:
DE:
(11)
To ensure public awareness on the
1. The auditor should only check whether
compliance of the reporting obligations by the there is “a” report but not the content of the
relevant undertakings, To ensure that cases of
report (which might be indicated by using
non-compliance are disclosed to the public,
“the” report in the current draft.).
statutory auditor(s) or audit firm(s) should check
state whether
A the report on income tax
2. Art. 48d has been amended to include the
information has been submitted and presented
accessibility via the national register’s
published in accordance with the requirements of
website. This should be mentioned in recital
this Directive and made accessible on the relevant
11 as well (Drafting suggestion on capital
undertaking’s
OR THE NATIONAL REGISTER’S
letters).
website or on the website of an affiliated
undertaking
, within the time limits established
by this Directive
(12) This Directive aims to enhance transparency
DE:
and public scrutiny on corporate income tax by
adapting the existing legal framework concerning
See above.
the obligations imposed on companies and firms in
respect of the publication of reports, for the
LU:
protection of the interests of members and others,
within the meaning of Article 50(2)(g) TFEU. As the
As mentioned already above we do not consider
Court of Justice held, in particular, in Case C-97/96
the legal basis of the Article 50 as appropriate one
9
Verband deutscher Daihatsu-Händler, Article
for the purpose of the proposal.
50(2)(g) TFEU refers to the need to protect the
interests of "others" generally, without
distinguishing or excluding any categories falling
within the ambit of that term. Moreover, the
objective of attaining freedom of establishment,
which is assigned in very broad terms to the
institutions by Article 50(1) TFEU, cannot be
circumscribed by the provisions of Article 50(2)
TFEU. Given that this Directive does not concern
the harmonisation of taxes but only obligations to
publish reports on income tax information, Article
50(1) TFEU constitutes the appropriate legal basis.
(13) In order to determine certain tax jurisdictions
for which a high level of detail should be shown,
the power to adopt acts in accordance with Article
290 TFEU should be delegated to the Commission
in respect of drawing up a common Union list of
these tax jurisdictions. This list should be drawn up
on the basis of certain criteria, identified on the
basis of Annex 1 of the Communication from the
Commission to the European Parliament and
Council on an External Strategy for Effective
Taxation (COM(2016) 24 final). It is of particular
importance that the Commission carry out
appropriate consultations during its preparatory
work, including at expert level, and that those
consultations be conducted in accordance with the
principles laid down in the Interinstitutional
Agreement on Better Law-Making as approved by
the European Parliament, the Council and the
Commission and pending formal signature. In
particular, to ensure equal participation in the
preparation of delegated acts, the European
Parliament and the Council receive all documents
at the same time as Member States' experts, and
their experts systematically have access to
meetings of Commission expert groups dealing with
the preparation of delegated acts.
10
(14) Since the objective of this Directive cannot be
sufficiently achieved by the Member States but can
rather, by reason of its effect, be better achieved
at Union level, the Union may adopt measures, in
accordance with the principle of subsidiarity as set
out in Article 5 of the Treaty on European Union. In
accordance with the principle of proportionality as
set out in that Article, this Directive does not go
beyond what is necessary in order to achieve that
objective.
(15) This Directive respects the fundamental rights
and observes the principles recognised in particular
by the Charter of Fundamental Rights of the
European Union.
(16) In accordance with the Joint Political
DE:
DE:
Declaration of 28 September 2011 of Member
States and the Commission on explanatory
(16) In accordance with the Joint Political
DELETE –
We do not see a necessity to impose
documents, Member States have undertaken to
Declaration of 28 September 2011 of Member
a correlation table for the current instrument.
accompany, in justified cases, the notification of
States and the Commission on explanatory
their transposition measures with one or more
documents, Member States have undertaken to
documents explaining the relationship between the accompany, in justified cases, the notification of
components of a directive and the corresponding
their transposition measures with one or more
parts of national transposition instruments. With
documents explaining the relationship between the
regard to this Directive, the legislator considers the components of a directive and the corresponding
transmission of such documents to be justified.
parts of national transposition instruments. With
regard to this Directive, the legislator considers the
transmission of such documents to be justified.
(17) Directive 2013/34/EU should therefore be
amended accordingly,
11
Article 1
Amendments to Directive 2013/34/EU
Directive 2013/34/EU is amended as follows:
(1) in Article 1, the following paragraph 1a is
inserted:
‘1a. The coordination measures prescribed by
DE:
DE:
Articles 2, 48a to 48
eg and 51 shall also apply to
the laws, regulations and administrative provisions
1a. The coordination measures prescribed by
1. It should be clarified that including Art. 2
of the Member States relating to branches opened
Articles 2, 48a to 48
eg and 51 shall also apply to
for branches does not mean that all the
in a Member State by an undertaking which is not
the laws, regulations and administrative provisions
definitions in Art. 2 shall apply to branches in
governed by the law of a Member State but which
of the Member States relating to branches opened
the future. New wording has been added at
is of a legal form comparable with the types of
AND STILL OPERATED in a Member State by an
the end while the reference to Art. 2 in the
undertakings listed in Annex I.’;
undertaking which is not governed by the law of a
beginning has been deleted.
Member State but which is of a legal form
comparable with the types of undertakings listed in
2. We still see a problem if an undertaking
Annex I.
ARTICLE 2 SHALL APLLY TO THESE
with a legal form under Annex I has opened
BRANCHES AS FAR AS ARTICLES 48A TO 48E
the branch but has in the meantime changed
AND 51 REFER TO SUCH BRANCHES.’
its legal form into one not falling under Annex
I. In this case no requirements should apply
to branches.
3. In a recital the question of “comparable
legal forms” should be dealt with. COM may
provide a drafting suggestion which refers to
the existing Accounting Directive.
LU:
12
The Article should be clear about which
undertakings is covered.
How and at what time shall a MS make the
assessment if the undertaking is of a legal form
comparable with the types of undertakings listed in
Annex I is still unclear?
(2) the following Chapter 10a is inserted:
‘Chapter 10a
Report on Income tax information
Article 48a
Definitions relating to reporting on income tax
information
1. For the purposes of this Chapter, the following
definitions shall apply:
(1) ‘ultimate parent undertaking’ means an
undertaking which draws up the consolidated
financial statements of the largest body of
undertakings;
(2) ‘consolidated financial statements’ means the
financial statements prepared by a parent
13
undertaking of a group in which the assets,
liabilities, equity, income and expenses are
presented as those of a single economic entity;
(3) ‘tax jurisdiction’ means a State as well as a
non-State jurisdiction which has fiscal autonomy in
respect of corporate income tax.
2. For the purposes of Article 48b, the
following definition shall apply:
‘revenue’has the same meaning as:
(1) the ‘net turnover’, for undertakings DK:
DK:
governed by the law of a Member State, and
(1) the ‘net turnover’, for undertakings falling We believe that this is a more correct and precise
within the scope of this Directive governed by description and it is similar to the desciption in
the law of a Member State, and
recital (6a).
IE:
IE:
A recital clarifying the intent of this paragraph EU companies that apply IFRS may have difficulty
would be useful
in understanding and accepting that the scope is
determined by the Accounting Directive
measurement “net turnover” instead of the IFRS
measurement “revenue”. A recital would help to
reinforce the message.
The term “net turnover” is not relevant to banks,
insurance undertakings and investment
undertakings. It does not feature in the layouts in
Directive 86/635/EEC or 91/674/EEC. The term is
used in Article 89 of Directive 2013/36/EU (DAC IV
CbCR); this gave rise to difficulties in interpretation
and the EBA found it necessary to give an
interpretation for that purpose (EBA Single
14
Rulebook Q&A (Question ID: 2014_1249).
(2) the ‘revenue’ as defined by or within the
meaning of the financial reporting framework
on the basis of which financial statements are
prepared, for other undertakings.
Article 48b
Undertakings and branches required to report on
income tax information
1. Member States shall require ultimate parent
DE:
undertakings governed by their national laws
which on their balance sheet date exceeded
Second subpara.:
for the last two consecutive financial years a
Question the reference to purely non-
total consolidated revenue of
affiliated undertakings (does this go beyond
EUR 750 000 000 as reflected in their
DAC IV?).
consolidated financial statements and having a
consolidated net turnover exceeding EUR 750 000
A written COM answer should be provided.
000 as well as undertakings governed by their
national laws that are not affiliated undertakings
and having a net turnover exceeding EUR 750 000
LU:
LU:
000 to draw up
, and publish
and make accessible
a report on income tax information
as regards the "which on their balance sheet exceeded for each of Clarification of the paragraph.
later of the last two consecutive financial
the last two consecutive financial years a total…”
years. on an annual basis.
EL:
Member States shall require undertakings
1. The scope for which there is no support (from
governed by their national laws that are not
MS) is extremely large (€ 750,000,000) for large
affiliated undertakings and which on their
companies and groups.
balance sheet date exceeded for the last two
consecutive financial years a total revenue of
EUR 750 000 000 as reflected in their annual
We want to lower the threshold from
15
financial statements to draw up, publish and
750,000,000 to the limit of 40,000,000 and
make accessible a report on income tax
concern the LARGE companies and groups as
information as regards the later of the last
defined by Article 3 (4) (for companies) &
two consecutive financial years.
par. 7 (for groups) of accounting Directive
(2013/34 / EU):
The report on income tax information shall be
made accessible to the public on the website of the
undertaking on the date of its publication.
{4. Large enterprises are enterprises which, at the
balance sheet date, exceed the limits of at least
two of the following three criteria: (a) balance
sheet total: EUR 20000000; (b) net turnover: EUR
40000000; (c) average number of employees
during the year: 250.}
7. Large groups are groups of parent and
subsidiary undertakings to be consolidated and
which, consolidated, exceed the limits of at least
two of the following three criteria at the balance
sheet date of the parent undertaking: (a) balance
sheet total: EUR 20000000; (b) net turnover: EUR
40000000; (c) average number of employees
during the year: 250.}
So if the threshold goes down then it's worth
talking about a good number of companies.
Also in this position has already been addressed by
the Parliament with the relevant report of the
Social & Economic Committee, which states that
the scope should apply to large companies and
groups.
1a. Member States shall not apply the rules
AT:
AT:
set out in paragraph 1 to non-affiliated
undertakings, ultimate parent undertakings
1a. Member States shall not apply the rules
Alignment to the “NME Group”-Definition in
and their affiliated undertakings where such
set out in paragraph 1
Directive 2016/881.
undertakings operate only within the territory
of one single Member State and in no other
a) to ultimate parent undertakings where the
16
tax jurisdiction.
tax residence of the affiliated undertakings is
within the territory of the same Member State
and in no other tax jurisdiction;
b) to non-affiliated undertakings that are not
subject to tax with respect to the business
carried out through a permanent
establishment in another jurisdiction.
DE:
1a. Member States shall not apply the rules
DE:
set out in paragraph 1 to non-affiliated
undertakings, ultimate parent undertakings
1. The use of “operate” may lead to questions
and their affiliated undertakings where such
in practice. We suggest to use a clearer
undertakings HAVE NO SUBSIDIARY
wording which is based on the concept of the
UNDERTAKING OR BRANCH IN OTHER STATES Accounting Directive.
operate only within the territory of one single
Member State and in no other tax jurisdiction. 2. Question as before the reference to non-
affiliated undertakings (does this go beyond
DAC IV?)
LU:
We would like to understand the difference
between the term “carrying out activities” as
written in recitals (2) and (6), and “operate” in
paragraph 1a and why different terminology is
used?
2. Member States shall not apply the rules set out
DE:
DE:
in paragraph 1 of this Article to
non-affiliated
undertakings and ultimate parent undertakings
2. Member States shall not apply the rules set out
1. Question as before the reference to non-
where such undertakings or their affiliated
in paragraph 1 of this Article to
non-affiliated
affiliated undertakings (does this go beyond
undertakings
disclose a report in accordance
undertakings and ultimate parent undertakings
DAC IV?).
with are subject to Article 89 of
WHICH ARE GOVERNED BY THEIR NATIONAL
Directive 2013/36/EU of the European Parliament
17
link to page 19 link to page 19
and of the Council
2 and encompass, in a country-
LAW where such undertakings or their affiliated
by-country
that report, information on
all their
undertakings
disclose a report in accordance
2. Add reference to “governed by their
activities and all the activities of all the affiliated
with are subject to Article 89 of
national law” as in para. 1.
undertakings included in the consolidated financial
Directive 2013/36/EU of the European Parliament
statement of those ultimate parent undertakings.
and of the Council
3 and encompass, in a country-
by-country
that report, information on
all their
activities and all the activities of all the affiliated
undertakings included in the consolidated financial
statement of those ultimate parent undertakings.
3. Member States shall require the medium-sized
DE:
DE:
and large subsidiary undertakings referred to in
Article 3(3) and (4)
that which are governed by
3. Member States shall require the medium-sized
1. It is unclear whether the subsidiary should
their national laws and controlled by an ultimate
and large subsidiary undertakings referred to in
check the content of report which is provided
parent undertaking which
on its balance sheet
Article 3(3) and (4)
that which are governed by
by the parent company.
date exceeded for the last two consecutive
their national laws and controlled by an ultimate
financial years a total consolidated revenue of parent undertaking which
on its balance sheet
2. Typo to be corrected (“udertaking” should
EUR 750 000 000 as reflected in its
date exceeded for the last two consecutive
be “undertaking”).
consolidated financial statements has a
financial years a total consolidated revenue of
consolidated net turnover exceeding EUR 750 000
EUR 750 000 000 as reflected in its
000 and which is not governed by the law of a
consolidated financial statements has a
Member State, to publish
and make accessible
consolidated net turnover exceeding EUR 750 000
the
a report on income tax information of that
000 and which is not governed by the law of a
ultimate parent undertaking
as regards the later
Member State, to publish
and make accessible
of the last two consecutive financial years, to
the
a report on income tax information of that
the extent that the information is available to
ultimate parent undertaking
as regards the later
the subsidiary undertaking. When the
of the last two consecutive financial years, to
information is not available, the subsidiary
the extent that A REPORT the information is
2
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the
prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and
2006/49/EC
(OJ L 176, 27.6.2013, p. 338).
3
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the
prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and
2006/49/EC
(OJ L 176, 27.6.2013, p. 338).
18
undertaking shall request its ultimate parent
available to the subsidiary undertaking. When
udertaking not governed by the law of a
the A REPORT information is not available, the
Member State to provide it with all
subsidiary undertaking shall request its
information required to enable it to meet its
ultimate parent uNdertaking not governed by
obligation. In case the information is not
the law of a Member State to provide it with
provided, the report shall contain an
all information required to enable it to meet
explanation as to why this is the case. on an
its obligation. In case the information is not
annual basis.
provided, the report shall contain an
explanation as to why this is the case. on an
If such subsidiary undertaking exceeds the
annual basis.
threshold set out in paragraph 1, it shall
publish its own report on income tax
DK:
information as provided for under paragraph
1.
A comment to this part of the paragraph:
The report on income tax information shall be
In case the information is not provided, the
made accessible to the public on the date of its
report shall contain an explanation as to why
publication on the website of the subsidiary
this is the case. on an annual basis.
undertaking or on the website of an affiliated
undertaking.
Which report shall contain this information? An
“empty” report submitted by the subsidiary stating
only that information has not been provided by the
ultimate parent undertaking?
LU:
LU:
which on their balance sheet exceeded for each of
the last two consecutive financial years a total…”
Clarification of the paragraph
IE:
This “comply or explain” provision is very helpful
and we would like it to be kept in. We would have
legal difficulty imposing sanctions on a legal entity
(or on the management of a legal entity) as a
result of the actions (or omissions) of a different
legal entity (the ultimate parent undertaking) over
which the first legal entity has no control.
EL:
1. Widen the scope and scope of small
business subsidiaries with regard to the
19
obligation for them to issue a reference for
information on taxable income and which are
controlled together with the medium and large
enterprises by the parent company, Conditions
of that Article. With this arrangement, the
number of companies that will be obliged to
produce the report will increase significantly.
2. We agree with the phrase :
« for the last two
consecutive financial years»
3. The scope for which there is no support (from
MS) is extremely large (€ 750,000,000) for
large companies and groups.
We want to lower the threshold from
750,000,000 to the limit of 40,000,000
and concern the LARGE companies and
groups as defined by Article 3 (4) (for
companies) & par. 7 (for groups) of
accounting Directive (2013/34 / EU):
{4. Large enterprises are enterprises which, at
the balance sheet date, exceed the limits of at
least two of the following three criteria: (a)
balance sheet total: EUR 20000000; (b) net
turnover: EUR 40000000; (c) average number of
employees during the year: 250.}
7. Large groups are groups of parent and
subsidiary undertakings to be consolidated and
which, consolidated, exceed the limits of at least
two of the following three criteria at the balance
sheet date of the parent undertaking: (a)
balance sheet total: EUR 20000000; (b) net
turnover: EUR 40000000; (c) average number of
employees during the year: 250.}
So if the threshold goes down then it's worth
talking about a good number of companies.
20
Also in this position has already been addressed
by the Parliament with the relevant report of the
Social & Economic Committee, which states that
the scope should apply to large companies and
groups.
4. We disagree with the addition to
paragraph 3 of Article 48b of the phrase "In
the case of a subsidiary undertaking, In
paragraph 1, it shall publish its own report on
income tax information as provided for in
paragraph 1. "
Here we consider that there is
a reporting obligation and any explanation
opens the door to companies and groups
not to report.
We do not agree on that. In any case the
information must be provided. It is a
provision with no exceptions. Otherwise will
create an environment of non reporting.
Here is not the case of explain or comply.
We delete this item because it is against the
provisions.
4. Member States shall require branches which are
DE:
DE:
opened in their territories by an undertaking which
is not governed by the law of a Member State to
4. Member States shall require branches which are
1. We still struggle with the concept that the
publish
and make accessible on an annual basis
opened in their territories by an undertaking
AND
text refers to the legal form of the opening
the
a report on income tax information of the
STILL OPERATES IT which is not governed by the
undertaking only for the moment when the
ultimate parent undertaking
or the non-affiliated law of a Member State to publish
and make
branch is opened. It should be added that
undertaking referred to in point (a) of
this
accessible on an annual basis the
a report on
such an undertaking still operates the branch.
paragraph
as regards the later of the last two
income tax information of the ultimate parent
In the case of subsidiaries any requirements
consecutive financial years, to the extent that undertaking
or the non-affiliated undertaking
are only applicate if the parent company has
the information is available to the person(s)
referred to in point (a) of
this paragraph
as
the legal form of Annex I.
designated to carry out the disclosure
regards the later of the last two consecutive
formalilities referred to in Article 48e(2).
financial years, to the extent that A REPORT
2. As in paragraph 3 reference should be
When the information is not available, such
the information is available to the person(s)
made to “a report” rather than to information.
person(s) shall request the ultimate parent
designated to carry out the disclosure
undertaking not governed by the law of a
formalilities referred to in Article 48e(2).
3. In the second subparagraph reference
21
Member State or the non-affiliated
When A REPORT the information is not
should be made – as in the first subparagraph
undertaking referred to in point (a) of this
available, such person(s) shall request the
– to the “last” two financial years.
paragraph to provide all information required
ultimate parent undertaking not governed by
to meet their obligations. In case the
the law of a Member State or the non-
information is not provided, the report shall
affiliated undertaking referred to in point (a)
contain an explanation as to why this is the
of this paragraph to provide all information
case. 5 of this Article.
required to meet their obligations. In case the
information is not provided, the report shall
The report on income tax information shall be
contain an explanation as to why this is the
made accessible to the public on the date of its
case. 5 of this Article.
publication on the website of the branch or on the
website of an affiliated undertaking.
The report on income tax information shall be
made accessible to the public on the date of its
Member States shall
not apply the first
publication on the website of the branch or on the
subparagraph of this paragraph only to branches
website of an affiliated undertaking.
which have net turnover
did not exceeding
at
least for two consecutive financial years the
Member States shall
not apply the first
net turnover threshold defined by the law of each
subparagraph of this paragraph only to branches
Member State pursuant to Article 3(2).
which have net turnover
did not exceeding
at
least for THE LAST two consecutive financial
years the net turnover threshold defined by the
law of each Member State pursuant to Article 3(2).
DK:
A comment to this part of the paragraph:
In case the information is not provided, the
report shall contain an explanation as to why
this is the case. 5 of this Article.
Which report shall contain this information? An
“empty” report submitted by the branch stating
only that information has not been provided by the
ultimate parent undertaking?
LU:
As a starting point, we are in favour of the wording
that has been used in DAC 4, which allows the
entity that cannot obtain all required information
from its ultimate parent established in a third
country only to file the information which is
available and notify that the ultimate parent has
22
refused to make the necessary information
available. The concept of “comply and explain” in
case the information is not available is a minimum
that we could accept.
EL:
1.
We disagree with the addition to
paragraph 4 of Article 48b of the phrase "In
case the information is not provided, the report
shall contain an explanation as to why this is the
case."
Here we consider that there is a
reporting obligation and any explanation
Explain) opens the door to companies and
groups for not reporting.
The same here. The obligation is that the
income tax reporting must be provided with
no exceptions.
5. Member States shall apply the rules set out in
this paragraph 4 only to a branch
only where the
following criteria are met:
(a) the undertaking that which opened the branch
DE:
DE:
is either an affiliated undertaking of a group which
is controlled by an
whose ultimate parent
(a) the undertaking that which opened the branch
See above.
undertaking
is not governed by the law of a
AND STILL OPERATES IT is either an affiliated
Member State and which
on its balance sheet
undertaking of a group which is controlled by an
date exceeded for two the last two
whose ultimate parent undertaking
is not
consecutive financial years a total
governed by the law of a Member State and which
consolidated revenue of EUR 750 000 000
as
on its balance sheet date exceeded for two
reflected in its consolidated financial
the last two consecutive financial years a
statements has a consolidated net turnover
total consolidated revenue of EUR 750 000 000
exceeding or an undertaking that is not an
as reflected in its consolidated financial
affiliated undertaking and which has a net turnover
statements has a consolidated net turnover
exceeding
on its balance sheet date exceeded
23
for the last two consecutive financial years a
exceeding or an undertaking that is not an
total revenue of EUR 750 000 000
as reflected
affiliated undertaking and which has a net turnover
in its financial statements;
and
exceeding
on its balance sheet date exceeded
for the last two consecutive financial years a
total revenue of EUR 750 000 000
as reflected
in its financial statements;
and
SE:
SE:
..."which on their balance sheet exceeded for each
of the last two consecutive financial years a total…” Clarification of tha paragraph. And there is a extra
“two“ that should be deleted.
..."which on their balance sheet exceeded for each
of the last two consecutive financial years a total…” Clarification of the paragraph.
EL:
1. For branch-based enterprises that are affiliated
with a group, determine
whether the head
office of that group is located inside or
outside the EU.
2. We agree with the phrase : «
for the last two
consecutive financial years»
3. The scope for which there is no support (from
MS) is extremely large (€ 750,000,000) for large
companies and groups.
We want to lower the threshold from
750,000,000 to the limit of 40,000,000 and
concern the LARGE companies and groups
as defined by Article 3 (4) (for companies)
& par. 7 (for groups) of accounting
Directive (2013/34 / EU):
{4. Large enterprises are enterprises which, at
the balance sheet date, exceed the limits of at
least two of the following three criteria: (a)
balance sheet total: EUR 20000000; (b) net
turnover: EUR 40000000; (c) average number of
24
employees during the year: 250.}
7. Large groups are groups of parent and
subsidiary undertakings to be consolidated and
which, consolidated, exceed the limits of at least
two of the following three criteria at the balance
sheet date of the parent undertaking: (a)
balance sheet total: EUR 20000000; (b) net
turnover: EUR 40000000; (c) average number of
employees during the year: 250.}
So if the threshold goes down then it's worth
talking about a good number of companies.
Also in this position has already been addressed
by the Parliament with the relevant report of the
Social & Economic Committee, which states that
the scope should apply to large companies and
groups
(b) the ultimate parent undertaking referred to in
DE:
DE:
point (a) does not have a medium-sized or large
subsidiary undertaking as referred to in paragraph
(b) the ultimate parent undertaking referred to in
As an alternative for the amendment in point
3.
point (a) does not have a medium-sized or large
(a) with regard to the legal form of the
subsidiary undertaking as referred to in paragraph
undertaking operating the branch at the
AND
moment of the reporting obligation one could
add point (c).
DE:
DE:
(c) the ultimate parent undertaking referred
See Above.
to in point (a) has a legal form which is
comparable with the types of undertakings
listed in Annex I.
6. Member States shall not apply the rules set out
DE:
in paragraphs 3 and 4 of this Article where a report
on income tax information drawn up in accordance
The AUT comment in the last Working Group
25
with
consistently with Article 48c
and:
meeting should be verified in order to exclude
circular references.
SE:
Should be “5.”
(a) is made accessible
:
(i) to the public on the website of the ultimate
DE:
parent undertaking
or of the non-affiliated
undertaking not governed by the law of a Member
The condition (“not governed by the law of a
State
;
Member State”) applies to both, “ultimate
parent undertakings” and “non-affiliated
undertakings”, which should be made clear in
the text.
(ii) in at least one of the official languages of
the Union;
(iii) within a reasonable period of time, which shall
not exceed
12 months after the balance sheet date
of the financial year for which the report is
drawn up; and
EL:
EL:
(iv) in the commercial registers of the
1. The reporting of taxable income for branches
Member States and that this obligation is
and subsidiaries, where there is no obligation to
even at no cost.
apply the provisions of paragraphs 3 and 4 of that
Article,
shall be published and accessible, in
26
addition to that already provided for in (a) (I)
to (iii) and (b) in the commercial registers of
the Member States in which the said branches
and subsidiaries are registered and that this
obligation is even at no cost.
(b) where the report identifies the name and the
registered office of the single subsidiary
undertaking or
the name and the address of the
single branch governed by the law of a Member
State which has published the
a report in
accordance with Article 48d(1).
7. Member State
s shall require subsidiaries
and or
LU:
branches not subject to the provisions of
paragraphs 3 and 4 to publish and make accessible
The current drafting of this anti-abuse clause is
the
a report on income tax information where such
much too broad. It is not clear at all what concrete
subsidiaries or branches have been established for
situations are meant to be covered, which would
the purpose of avoiding the reporting requirements
give rise to legal uncertainty. Either this paragraph
set out in this Chapter.
should be deleted or at least it should be
substantially redrafted in order to be better framed
SE:
The Article is unclear how the MS will have the
knowledge that a subsidiary or a branch has been
established for the purpose of avoiding the
reporting requirements?
Article 48c
Content of the report on income tax information
27
1. The report on income tax information shall
LU:
include information relating to all the activities of
the
non-affiliated undertaking and
or the ultimate
What is the exact meaning of the non-affiliated
parent undertaking, including activities
those of all
entities? What type of entities would it encompass,
affiliated undertakings consolidated in the financial
respectively how the ultimate parent entity can
statement in respect of the relevant financial year.
esteem a given non-affiliated entity should be
included in the report/consolidated financial
statements and what would be the next step in
case the information cannot be received from the
non-affiliated entity/entities?
2. The information referred to in paragraph 1 shall
be as follows comprise the following:
(-a) the name of the ultimate parent
undertaking or the non-affiliated undertaking,
financial year concerned and the currency
used;
(a) a brief description of the nature of the
activities;
(b) the number of employees
which is the
average number of employees during the
financial year;
(c) the
revenues which are: amount of the net
turnover, which includes the turnover made with
related parties;
28
(i) the sum of the net turnover, other
IE:
operating income, income from participating
interests, excluding dividends received from
The term “net turnover” is not relevant to banks,
affiliated undertakings, income from other
insurance undertakings and investment
investments and loans forming part of the
undertakings.
fixed assets, other interest receivable and
similar income as listed in Annexes V and VI
of this Directive, or
(ii) the income as defined by or within the
DK:
DK:
meaning of the financial reporting framework
on the basis of which financial statements are (ii) the income as defined by or within the
Proposal for clarification.
prepared excluding value adjustments and
meaning of the a financial reporting
dividends received from affiliated
framework other than this Directive on the
undertakings;
basis of which financial statements are
prepared excluding value adjustments and
dividends received from affiliated
undertakings;
(d) the amount of profit or loss before income tax;
(e) the amount of income tax accrued
in the
(current year)
, which is the current tax expense
recognised on taxable profits or losses of the
financial year by undertakings and branches
resident for tax purposes in the relevant tax
jurisdiction;
(f) the amount of income tax paid
on cash basis
which is the amount of income tax paid during the
relevant financial year by undertakings and
branches resident for tax purposes in the relevant
tax jurisdiction; and
29
(g) the amount of accumulated earnings.
DE:
DE:
(g) the amount of accumulated earnings.
According to the Commission’s Impact
Assessment this item leads to the risk of
misinterpretation.
For the purposes of point (c) of the first
subparagraph the revenues shall include
transactions with related parties.
For the purposes of point (e) of the first
subparagraph the current tax expense shall relate
only to the activities of an undertaking in the
current financial year and shall not include deferred
taxes or provisions for uncertain tax liabilities.
For the purposes of point (f) of the first
subparagraph taxes paid shall include
witholding taxes paid by other undertakings
with respect to payments to undertakings and
branches within a group.
For the purposes of point (g) of the first
DE:
DE:
subparagraph the accumulated earnings shall
mean the sum of the profit brought forward
For the purposes of point (g) of the first
1. DELETE (as seen above.
which was not decided for distribution to
subparagraph the accumulated earnings shall
members as of the end of the relevant
mean the sum of the profit OF THE FINANCIAL 2. If the text is not deleted the reference
financial year. With regard to branches,
YEAR brought forward which was not decided should be made to the profits which have
accumulated earnings shall be reported by the for distribution to members as of the end of
been brought forward in the financial year
undertaking which opened a branch.
the relevant financial year. With regard to
which the report covers.
branches, accumulated earnings shall be
30
reported by the undertaking which opened a
branch.
IE:
Our understanding is that “accumulated earnings”
refers to profits not distributed to shareholders,
built up over all prior years as well as in the current
year (i.e. the year for which the revenue and nuber
of employees is disclosed). A comment made by a
delegate at the meeting on 29 March 2017
suggests that not all Member States share this
view. It is important that its meaning for the
purpose of this Proposal is essentially the same as
for BEPS 13. Clarification might be helpful.
2a. Member States shall permit the
DK:
DK:
information listed in paragraph 2 to
correspond to the reporting specifications
2a. Member States shall permit the
We propose to move the first sentence in para 3 to
referred to in Annex III, Section III, Parts B
information listed in paragraph 2 to
the end of para 2a as it seems to more naturally
and C of Directive 2011/16/EU.
correspond to the reporting specifications
belong there.
referred to in Annex III, Section III, Parts B
and C of Directive 2011/16/EU.
The report shall specify whether it was
prepared in accordance with paragraph 2 or
2a.
3.
The report shall specify whether it was
AT:
prepared in accordance with paragraph 2 or
2a.
3.
The report shall specify whether it was
prepared in accordance with paragraph 2 or
The report shall present the information referred to
2a.
in paragraph 2 separately for each Member State.
Where a Member State comprises several tax
The report shall present the information referred to
jurisdictions, the information shall be combined at
in paragraph 2
or 2a separately for each Member
Member State level.
State. Where a Member State comprises several
tax jurisdictions, the information shall be combined
The report shall also present the information
31
link to page 33 link to page 33
referred to in paragraph 2 of this Article separately at Member State level.
for each tax jurisdiction which, at the end of the
previous financial year, is listed in the common
EU
The report shall also present the information
nion list of
non-cooperative jurisdictions for
referred to in paragraph 2
or 2a of this Article
tax purposes4 certain tax jurisdictions drawn up
separately for each tax jurisdiction which, at the
pursuant to Article 48g, unless the report explicitly
end of the previous financial year, is listed in the
confirms, subject to the responsibility referred to in common
EU nion list of
non-cooperative
Article 48e below, that the affiliated undertakings
jurisdictions for tax purposes5 certain tax
of a group governed by the laws of such tax
jurisdictions drawn up pursuant to Article 48g,
jurisdiction do not engage directly in transactions
unless the report explicitly confirms, subject to the
with any affiliated undertaking of the same group
responsibility referred to in Article 48e below, that
governed by the laws of any Member State.
the affiliated undertakings of a group governed by
the laws of such tax jurisdiction do not engage
The report shall present the information referred to directly in transactions with any affiliated
in paragraph 2 on an aggregated basis for other
undertaking of the same group governed by the
tax jurisdictions.
laws of any Member State.
The information shall be attributed to each relevant The report shall present the information referred to
tax jurisdiction on the basis of the existence of a
in paragraph 2
or 2a on an aggregated basis for
fixed place of business or of a permanent business
other tax jurisdictions.
activity which, arising from the activities of the
group
or non-affiliated undertaking, can give
DE:
DE:
rise to income tax liability in that tax jurisdiction.
NEW 8.
The report shall specify whether it
The requirement to specifiy whether the
Where the activities of several affiliated
was prepared in accordance with paragraph 2 report has been prepared in accordance with
undertakings can give rise to a tax liability within a
or 2a.
paragraph 2 or 2a should be moved to a new
single tax jurisdiction, the information attributed to
paragraph 8 in order to catch all cases.
that tax jurisdiction shall represent the sum of the
information relating to such activities of each
affiliated undertaking and their branches in that tax
jurisdiction.
DK:
DK:
Information on any particular activity shall not be
See our comment immediately above in regard to
attributed simultaneously to more than one tax
3.
The report shall specify whether it was
the
4
List adopted by the Council on [
lawyer-linguists: please add the reference].
The precise language of this footnote shall be adapted when the list is adopted by the Council.
List as referred to in the Conclusions of the Council of the European Union of 25 May 2016 and 8 November 2016.
5
List adopted by the Council on [
lawyer-linguists: please add the reference].
The precise language of this footnote shall be adapted when the list is adopted by the Council.
List as referred to in the Conclusions of the Council of the European Union of 25 May 2016 and 8 November 2016.
32
link to page 34
jurisdiction.
prepared in accordance with paragraph 2 or
draft proposal to delete the first sentence of the
2a.
paragraph.
A reference to paragraph 2a seems to appropriate.
The report shall present the information referred to
in paragraph 2 separately for each Member State.
Where a Member State comprises several tax
jurisdictions, the information shall be combined at
Member State level.
The report shall also present the information
referred to in paragraph 2 respectivly paragraph 2a
of this Article separately for each tax jurisdiction
which, at the end of the previous financial year, is
listed in the common
EU nion list of
non-
cooperative jurisdictions for tax purposes6
certain tax jurisdictions drawn up pursuant to
Article 48g, unless the report explicitly confirms,
subject to the responsibility referred to in Article
48e below, that the affiliated undertakings of a
group governed by the laws of such tax jurisdiction
do not engage directly in transactions with any
affiliated undertaking of the same group governed
by the laws of any Member State.
The report shall present the information referred to
in paragraph 2 respectivly paragraph 2a on an
aggregated basis for other tax jurisdictions.
The information shall be attributed to each relevant
tax jurisdiction on the basis of the existence of a
fixed place of business or of a permanent business
activity which, arising from the activities of the
group
or non-affiliated undertaking, can give
rise to income tax liability in that tax jurisdiction.
Where the activities of several affiliated
undertakings can give rise to a tax liability within a
single tax jurisdiction, the information attributed to
6
List adopted by the Council on [
lawyer-linguists: please add the reference].
The precise language of this footnote shall be adapted when the list is adopted by the Council.
List as referred to in the Conclusions of the Council of the European Union of 25 May 2016 and 8 November 2016.
33
that tax jurisdiction shall represent the sum of the
information relating to such activities of each
affiliated undertaking and their branches in that tax
jurisdiction.
Information on any particular activity shall not be
attributed simultaneously to more than one tax
jurisdiction.
IE:
We agree that there should be just one list.
The term “fixed place of business” features in
Article 5(1) of the OECD Model Tax Convention (in
the definition of “permanent establishment”) while
Article 7 refers to attributing profits to a permanent
establishment. The subparagraph in column 1
seems to take no account of the fact that residence
or domicile can (and generally do) give rise to a tax
liability on the basis of Article 4 of the Model
Convention. BEPS 13 makes a reasonably clear
distinction in this respect.
EL:
1. "…place of business or of a permanent business
activity which…"
To clarify whether, in relation to the information
given to the relevant tax jurisdiction,
the concept
of permanent business includes the provision
of distance services (eg via the internet / e-
shop, etc.).
2. "…Information on any particular activity shall
not be attributed simultaneously to more than one
tax jurisdiction..."
Allow the information to be passed on to another
tax jurisdiction
and not limited to one.
34
3a. Member States may allow information
DE:
DE:
required to be disclosed by paragraphs 2 and
3 of this Article to be omitted when its nature 3a. Member States may allow information
First sentence: The exemption should also
is such that it would be seriously prejudicial
required to be disclosed by paragraphs 2 and
cover cases where only a single project is
to the commercial position of the
3 of this Article to be omitted when its nature realized only in one tax jurisdiction.
undertakings to which it relates, including
is such that it would be seriously prejudicial
when only a single affiliated undertaking
to the commercial position of the
Second sentence: If the exception shall work
operates in a tax jurisdiction which is not
undertakings to which it relates, including
it is not useful to add a requirement to
listed in the EU list of non-cooperative
when only ONE PROJECT IS REALIZED IN A
disclose the omission as this would require
jurisdictions for tax purposes. Any such
TAX JURISDICTION OR a single affiliated
undertakings to at least publish some of the
omission shall be disclosed in the report.
undertaking ONLY operates in a tax
jurisdiction. THIS DOES NOT APPLY IF THE
prejudicial information.
TAX JURISDICTION which is not listed in the
EU list of non-cooperative jurisdictions for tax
purposes. Any such omission shall be
disclosed in the report.
DK:
DK:
3a. Member States may allow information
required to be disclosed by paragraphs 2 and
Firstly, we propose to amend the text referring to a
3 of this Article to be omitted when its nature situation in which an undertaking is allowed to omit
is such that it would be seriously prejudicial
information, as we find the example unclear. We
to the commercial position of the
have proposed another example to illustrate a
undertakings to which it relates, e.g.
situation in which we believe it could be seriously
including when only an single affiliated
prejudicial for an undertaking to disclose
undertaking has only one activity operates in
information.
a particular tax jurisdiction which is not listed
in the EU list of non-cooperative jurisdictions
Secondly, the draft proposal shall ensure that
for tax purposes. Any such omission and the
undertakings making use of the option must not
grounds for the omission shall be disclosed in only disclose the fact that they have omitted
the report.
information – but also the reasons why they have
omitted information.
EL:
We do not agree with this paragraph. We
want to delete it. Member States should not be
allowed to omit the obligation to disclose the
information referred to in subparagraphs 2 and 3
of that Article on the ground that such information
would, by its very nature, be detrimental to the
undertaking concerned. Such an option would
35
negate the purposes of this Directive with regard
to the disclosure of financial information and
contribute to the strengthening of tax evasion.
4. The report shall
may include
, where applicable DK:
DK:
at group level
, an overall narrative providing
explanations on material discrepancies between the 4. The report shall
may include
, where applicable We believe that it is unnecessary to state that the
amounts disclosed pursuant to points (e) and (f) of at group level
, an overall narrative providing
undertaking can provide more information than
paragraph 2, if any, taking into account if
explanations on material discrepancies between the required in the proposal. As we understand the
appropriate corresponding amounts concerning
amounts disclosed pursuant to points (e) and (f) of proposal it outlines minimum requirements. See
previous financial years.
paragraph 2, if any, taking into account if
above also the draft proposal to delete part of
appropriate corresponding amounts concerning
recital (8a)
previous financial years.
5. The report on income tax information shall be
published and made accessible on the website in at
least one of the official languages of the Union.
6. The currency used in the report on income tax
information shall be the currency in which the
consolidated financial statements
of the ultimate
parent undertaking or the annual financial
statements of the non-affiliated undertaking
are presented. Member States shall not require this
report to be published in a different currency than
the currency used in the financial statements.
7. Where Member States have not adopted the
EL:
euro, the threshold referred to in Article 48b(1)
shall
may be converted into the national currency
.
"…and by
may increase increasing or
decrease
by
Such conversion must applying the exchange
decreasing it
the thresholds by not more than 5
rate as at
[Publications Office- set the date = the
% in order to produce a round sum in the national
date of the entry in force of this Directive]
currencies…"
published in the Official Journal of the European
Where Member States have adopted the euro on
36
Union and by
may increase increasing or
the financial statements prepared in local currency,
decrease decreasing it
the thresholds by not
not to enable variation of 5% for the euro-
more than 5 % in order to produce a round sum in
national currency conversion rate (such as the
the national currencies.
exchange rate published in the EU official journal)
but be drawn at the rate determined on that
The thresholds referred to in Article 48b(3) and (4)
day, without the possibility percent
shall be converted to an equivalent amount in the
fluctuation and which rate of the day to be a
national currency of any relevant third countries by
reference and identification for the preparation of
applying the exchange rate as at
[Publications
financial statements of each type Enterprises
Office - set the date = the date of the entry in
takings (subsidiaries, associated, native,
force of this Directive], rounded off to the nearest
branches).
thousand.
DE:
DE:
NEW 8.
The report shall specify whether it
See above.
was prepared in accordance with paragraph 2
or 2a.
Article 48d
Publication and Accessibility
DK:
Can the Presidency confirm that the proposal does
not specify if the CBCR report should be published
as a part of the annual financial statement or as a
separat report meaning that Member States can
decide to require either option or Member States
can leave it up to the undertakings to decide for
themselves?
1. The report on income tax information shall be
published
within 12 months after the balance
sheet date of the financial year for which the
report is drawn up as laid down by the laws of
each Member State in accordance with Chapter 2 of
Directive 2009/101/EC, together with documents
referred to in Article 30(1) of this Directive and
37
link to page 39
where relevant, with the accounting documents
referred to in
in accordance with Article
7 9 of
Council Directive 89/666/EEC
7.
1a. The report published in accordance with
paragraph 1 shall be made accessible to the
public within 12 months after the balance
sheet date of the financial year for which the
report is drawn up:
(a) on the website of the undertaking when
Article 48b(1) applies, or
(b) on the website of the subsidiary
undertaking or on the website of an affiliated
undertaking when Article 48b(3) applies, or
(c) on the website of the branch or on the
website of the undertaking which opened the
branch or on the website of an affiliated
undertaking when Article 48b(4) applies.
EL:
EL:
d) "to the Commercial Register of the Member 1. Add Case (d) "to the Commercial Register
State"
of the Member State"
1b. Member States may exempt undertakings
DE:
to apply the rules set out in paragraph 1a of
this Article where the report published in
We very much welcome this exception which
7
Eleventh Council Directive 89/666/EEC of 21 December 1989 concerning disclosure requirements in respect of branches opened in a Member
State by certain types of company governed by the law of another State (OJ L 395, 30.12.1989, p. 36).
38
accordance with paragraph 1 is
leads to less costs for companies and a more
simultaneously made accessible to the public
effective enforcement.
on the website of the register referred to in
Article 3(1) of Directive 2009/101/EC. The
DK:
website of the undertakings and branches as
referred to in paragraph 1a shall contain
Denmark is very supportive of this paragraph as it
information on the exemption and the
will reduce administrative burdens for the
reference to the website of the relevant
undertakings concerned if they need only submit
register. The report on the website of the
the CBCR report to the national company register
register must be accessible to any third
and not to publish it themselves on their website.
parties located within the Union and free of
charge.
SE:
It is unclear to whom the last sentence in this
paragraph is directed. The requirements to publish
are directed to the undertakings, but when the last
sentence is in this context it could be read that the
provisions in the last sentence are addressed
towards the register.
2. The report referred to in Article 48b(1), (3), (4)
DK:
DK:
and (6) shall remain accessible on the website for a
minimum of five consecutive years.
2. The report referred to in Article 48b(1), (3), (4)
Proposal for clarification.
and (6) shall remain accessible on the website, cf
paragraph 1a or on the website of the register
mentioned cf paragraph 1b for a minimum of five
consecutive years.
EL:
1. We agree on that. We mark that the
publicity point (commercial puplicity) for all
the entities is business registry ( GEMI in
GREECE). Although we will provide this
specific information free of charge.
Article 48e
39
Responsibility for drawing up, publishing and
making accessible the report on income tax
information
1. Member States shall ensure that the members of
the administrative, management and supervisory
bodies of the ultimate parent undertaking
or the
non-affiliated undertakings referred to in Article
48b(1), acting within the competences assigned to
them under national law, have collective
responsibility for ensuring that the report on
income tax information is drawn up, published and
made accessible in accordance with Articles 48b,
48c and 48d.
2. Member States shall ensure that the members of
AT:
AT:
the administrative, management and supervisory
bodies of the subsidiary undertakings referred to in 2. Member States shall ensure that the members of Alignment to the change in Art 48b(3) last
Article 48b(3) of this Directive and the person(s)
the administrative, management and supervisory
sentence.
designated to carry out the disclosure formalities
bodies of the subsidiary undertakings referred to in
provided for in Article 13 of Directive 89/666/EEC
Article 48b(3) of this Directive and the person(s)
for the branch referred to in Article 48b(4) of this
designated to carry out the disclosure formalities
Directive, acting within the competences assigned
provided for in Article 13 of Directive 89/666/EEC
to them by national law, have collective
for the branch referred to in Article 48b(4) of this
responsibility for ensuring that, to the best of their
Directive, acting within the competences assigned
knowledge and ability, the report on income tax
to them by national law, have collective
information is drawn up
consistently with Article responsibility for ensuring that, to the best of their
48c,
is published and made accessible in
knowledge and ability, the report on income tax
accordance with Articles 48b, 48c and 48d.
information is drawn up
consistently with Article
48c,
is published and made accessible in
accordance with Articles 48b, 48c and 48d.
Where a subsidiary undertaking has to
publish its own report according to the last
sentence of Article 48b(3), its administrative,
management and supervisory bodies shall
have the responsibilities according to
paragraph 1.
40
DK:
DK:
2. Member States shall ensure that the members of We believe that the reference to Article 48c
the administrative, management and supervisory
indicates that members of the management are
bodies of the subsidiary undertakings referred to in responsible for not only
publishing the report but
Article 48b(3) of this Directive and the person(s)
also for the
content of the report as described in
designated to carry out the disclosure formalities
Article 48c. We believe the management should
not
provided for in Article 13 of Directive 89/666/EEC
be responsible for the content – not even to the
for the branch referred to in Article 48b(4) of this
best of their knowledge and ability – and we
Directive, acting within the competences assigned
therefore propose the deletion of the reference to
to them by national law, have collective
Article 48c.
responsibility for ensuring that, to the best of their
knowledge and ability, the report on income tax
We propose to insert a reference to Article 48b,
information is drawn up
consistently with Article paragraph (3) and (4) instead as the responsibility
48c, is drawn up in accordance with Articles
should include the responsibility to ensure whether
48b(3) and 48b(4)
is published and made
the subsidiary or branch is within the scope to
accessible in accordance with Articles 48b(3) ,
publish a report.
48b(4) 48b, 48c and and 48d.
We believe there should be a reference to the
responsibility for the management of the subsidiary
in the situation where the subsidiary exceeds the
thresholds in Article 48b (1) and the ultimate
parent undertaking is not drawing up a report for
the subsidiary to publish cf the last sentence in
Article 48b (3). We have not yet drafted a proposal
though.
IE:
This paragraph may not take full account of the
“comply or explain” element introduced into Article
48b(3) and (4). As worded, it appears to leave
local management exposed even where the
ultimate parent refuses to provide the necessary
information.
EL:
We completely disagree with the wording of
Article 48e, paragraph 2, and we want the
deletion of the phrase in the 6th line "..... to
the best of their knowledge and ability, ....", as this
phrase drastically restricts The responsibility of the
41
management (board of directors or directors /
managers) for drafting and submitting the financial
reporting by country.
Article 48f
CZ:
Article 48f
Independent check
statement
CZ:
Independent check
statement
DE:
DE:
Independent check Statement
BY STATUTORY
”Independent” statement may be misleading.
AUDITOR
DK:
DK:
Independent check
statement
Proposal for clarification.
Statement by the statutory auditor
Member States shall ensure that, where the
CZ:
CZ:
financial statements of an affiliated undertaking
governed by the law of a Member State
Member States shall ensure that, where the
The Czech Republic proposes to delete
Article 48f
referred to in Article 48b(1), (3) and (6)(b)
financial statements of an affiliated undertaking
and related
Article 1a of Directive 2006/43/EC
are
required to be audited by one or more
governed by the law of a Member State
concerning the independent check (or statement)
statutory auditor(s) or audit firm(s) pursuant to
referred to in Article 48b(1), (3) and (6)(b)
and the extension of scope of the audit report.
Article 34(1), the statutory auditor(s) or audit
are
required to be audited by one or more
Requirements introduced in
Article 48f aren´t
firm(s) also check
state(s) in the next audit
statutory auditor(s) or audit firm(s) pursuant to
appropriate for these reasons:
report after publication or, if applicable after
Article 34(1), the statutory auditor(s) or audit
the expiration of the time limit for publication firm(s) also check
state(s) in the next audit
Current wording doesn´t void our concerns
whether
, as of the date of the audit report, the
report after publication or, if applicable after
expressed during negotiation within the working
42
report on income tax information has been
the expiration of the time limit for publication party regarding effectivity (gains) of introduced
provided and made accessible in accordance with
whether
, as of the date of the audit report, the
measure especially wheter this measurement
referred to in Articles 48b, 48c and 48d
has been report on income tax information has been
entails formal verification that the required
published. The statutory auditor(s) or audit
provided and made accessible in accordance with
information has been provided or also a
firm(s) shall indicate in the audit report if the
referred to in Articles 48b, 48c and 48d
has been substantive review of the correctness and accuracy
report on income tax information has not been
published. The statutory auditor(s) or audit
of provided information.
provided or
and made accessible in accordance
firm(s) shall indicate in the audit report if the
with those Articles
48b and 48d.
report on income tax information has not been
Case: What happens if an undertaking
provided or
and made accessible in accordance
discloses the report but it doesn´t fulfil
with those Articles
48b and 48d.
contentual requirements referred to in Article
48c or substantial or all information published
in the report are misrepresented?
Current wording set forth in
Article 48f [check (or
statement)] doesn´t provide to a statutory auditor
or audit firm relevant legal framework how to
check (or statement) requirements set out in the
proposal or doesn´t provide a Member state
particulat legal framework how to fulfil
requierements contain in
Article 48f.
The Czech Republic doesn´t perceive any benefits
from formal verification of CBCR Tax report, let us
say, if it has been published, by statutory auditor
or audit firm.
The current wording could lead to a situation where
a statutory auditor or audit firm has to obtain all
information on a client’s full structure or even
group’s structure world-wide and their
requirements in area of CBCR Tax reporting in
order to identify whether the audit client is subject
to the proposal’s requirements and only then could
provide the appropriate statement in the audit
report.
The Czech Republic still dissents from the
extension of the content of the auditor’s
report stipulated in the Article 28 of the
directive 2006/43/ES for reasons of
ineffectiveness.
43
DE:
DE:
Member States shall ensure that, where the
The statutory auditor should only check
financial statements of an affiliated undertaking
whether there is “a” report.
governed by the law of a Member State
referred to in Article 48b(1), (3) and (6)(b)
are
required to be audited by one or more
statutory auditor(s) or audit firm(s) pursuant to
Article 34(1), the statutory auditor(s) or audit
firm(s) also check
state(s) in the next audit
report after publication or, if applicable after
the expiration of the time limit for publication
whether
, as of the date of the audit report, the
A report on income tax information has been
provided and made accessible in accordance with
referred to in Articles 48b, 48c and 48d
has been
published. The statutory auditor(s) or audit
firm(s) shall indicate in the audit report if the
report on income tax information has not been
provided or
and made accessible in accordance
with those Articles
48b and 48d.
DK:
We propose to have a discussion whether the
Directive should require the auditor to be able to
prove that he has made a useful effort to obtain
the needed information on the basis of which he
could conclude whether the undertaking was under
an obligation to draw up respectively publish and
make accessible a CBCR report.
Further we do not understand the reference to
(6)(b) in article 48b. Perhaps it should have been
(4) instead?
SE:
It is unclear why a requirement is introduced for
the auditors to check if the company has made a
report accessible in accordance with Article 58b
44
and 48d.
It is also unclear if the auditor first must make an
assessment wether the undertaking is an
undertaking that is required draw up a report and
only then could provide the appropriate statement
in the audit report.
Article 48g
Common Union list of certain tax jurisdictions
The Commission shall be empowered to adopt
delegated acts in accordance with Article 49 in
relation to drawing up a common Union list of
certain tax jurisdictions. That list shall be based on
the assessment of the tax jurisdictions, which do
not comply with the following criteria:
(1) Transparency and exchange of information,
including information exchange on request and
Automatic Exchange of Information of financial
account information
(2) Fair tax competition;
(3) Standards set up by the G20 and/or the OECD.
45
(4) Other relevant standards, including
international standards set up by the Financial
Action Task Force.
The Commission shall regularly review the list and,
where appropriate, amend it
to take account of
new circumstances.
Article 48h
Commencement date for reporting on income tax
information
Member States shall ensure that laws, regulations
and administrative provisions transposing
Articles 48a to 48f apply, at the latest, from the
commencement date of the first financial year
starting on or after
[Publications Office- set the
date = one year after the transposition deadline].
Article 48i
Report
The Commission shall report on the compliance
EL:
EL:
with and the impact of the reporting obligations set
out in Articles 48a to 48f. The report shall include
‘Two years after the transposition date of this
The deadline for submitting the financial reference
46
an evaluation of whether the report on income tax
Directive’
to the European Parliament and the Council
should
information delivers appropriate and proportionate
be reduced to two (2) years from the final
results, taking into account the need to ensure a
date for the transposition of the Directive.
sufficient level of transparency and the need for a
competitive environment for undertakings.
The report shall be submitted to the European
Parliament and to the Council by [
Publications
Office- set the date =
five years after the
transposition date of this Directive].’
(3) Article 49 is amended as follows:
(a) Paragraphs 2 and 3 are replaced by the
following
‘2. The power to adopt delegated acts referred to in
Article 1(2), Article 3(13),
and Article 46(2) and
Article 48g shall be conferred on the Commission
for an indeterminate period of time from the date
referred to in Article 54.
3. The delegation of power referred to in Article
1(2), Article 3(13) ,
and Article 46(2) and Article
48g may be revoked at any time by the European
Parliament or by the Council. A decision to revoke
shall put an end to the delegation of the power
specified in that decision. It shall take effect the
day following the publication of the decision in the
Official Journal of the European Union or at a later
date specified therein. It shall not affect the validity
of any delegated acts already in force.’
47
link to page 49
(b) The following paragraph 3a is inserted:
‘3a. Before adopting a delegated act, the
Commission shall consult experts designated by
each Member State in accordance with the
principles laid down in the Interinstitutional
Agreement on Better Law-Making of
13 April
2016 8[
date].’
(c) Paragraph 5 is replaced by the following:
‘5. A delegated act adopted pursuant to Article
1(2), Article 3(13) ,
and Article 46(2) and Article
48g shall enter into force only if no objection has
been expressed either by the European Parliament
or by the Council within a period of two months of
notification of that act to the European Parliament
and the Council or if, before the expiry of that
period, the European Parliament and the Council
have both informed the Commission that they will
not object. That period shall be extended by two
months at the initiative of the European Parliament
or of the Council.’
Article 1a
CZ:
Article 1a
8
OJ L 123, p. 1.
48
link to page 50 link to page 50
Amendment of Directive 2006/43/EC as
CZ:
regards the audit report
Amendment of Directive 2006/43/EC as
regards the audit report
Directive 2006/43/EC is amended as follows:
CZ:
CZ:
Directive 2006/43/EC is amended as follows:
see comments to the
Article 48f
Point (h) is added in paragraph 2 of Article
CZ:
28:
Point (h) is added in paragraph 2 of Article
"(h) where applicable, provide the statement
28:
referred to in Article 48f of
Directive 2013/34/EU9."
"(h) where applicable, provide the statement
referred to in Article 48f of
Directive 2013/34/EU10."
Article 2
Transposition
9
Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated
financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament
and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC.
10 Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated
financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament
and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC.
49
1. Member States shall bring into force the laws,
EL:
EL:
regulations and administrative provisions necessary
to comply with this Directive by
[Publications Office “one year after entry into force”
1. The time for transposition of the Directive
into
- set the date = one two years after entry into
one year after its vote.
force] at the latest. They shall forthwith
communicate to the Commission the text of those
provisions.
When Member States adopt those provisions, they
shall contain a reference to this Directive or be
accompanied by such a reference on the occasion
of their official publication. Member States shall
determine how such reference is to be made.
2. Member States shall communicate to the
Commission the text of the main provisions of
national law which they adopt in the field covered
by this Directive.
Article 3
Entry into force
This Directive shall enter into force on the
twentieth day following that of its publication in the
Official Journal of the European Union.
Article 4
50
Addressees
This Directive is addressed to the Member States.
Done at Strasbourg,
For the European Parliament For the Council
The President The President
EL:
FURTHER GENERAL COMMENTS on the DRAFT REPORT of the Committee on Economic and Monetary Affairs
Committee on Legal Affairs of the European Parliament (2016/0107(COD)
1. In the DRAFT REPORT OF THE COMMITTEE ON ECONOMIC AND MONETARY AFFAIRS / COMMITTEE ON LEGAL AFFAIRS (DOCUMENT 2016/0107 (COD)
p.27, second paragraph) it is noted
that the scope should in no case be limited to information relating to the Community MS, But instead
have a global character and in addition companies and / or groups should provide global information in every jurisdiction, including tax
havens. Therefore, financial reporting will be complete (since it will be global) and taxes will be paid where earnings are generated by ensuring fairer
and more sustainable tax-based national systems.
We agree with the above position of the EC Committee on Economic and Monetary Affairs.
And we support it as it is in the right direction.
2.
A SINGLE DECLARATION FORM (page 27, fourth paragraph, of the above report) for the disclosure of data, in order to ensure comparability of
financial data, a central element of the Accounting Directive (2013/34 / EU).
We agree with the above position of the EC Committee on
Economic and Monetary Affairs. And we support it as it is in the right direction.
51
