BEPS Action 13: Country implementation summary. Last updated: January 20, 2017

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1 BEPS Action 13: implementation summary Last updated: January 20,

2 BEPS action 13: implementation summary Belgium CbCR/MF/LF Final Legislation Denmark CbCR/MF/LF Final Legislation Norway CbCR Draft MF/LF intentions Sweden CbCR/MF/LF Draft Legislation Finland CbCR/MF/LF Draft Legislation United Kingdom Netherlands Poland Russia Canada CbCR Final Legislation United States Mexico CbCR Final Legislation Bermuda Colombia Peru Chile CbCR/MF/LF Final Legislation Costa Rica CbCR intentions CbCR intentions CbCR/MF/LF Final Legislation CbCR/MF/LF Final Legislation CbCR Final LF intentions CbCR Final Ireland MF/LF intentions CbCR Final Legislation Luxembourg CbCR Final Legislation France CbCR estonfinal Legislation Uruguay CbCR/MF/LF Final Legislation Iceland CbCR Final CbCR/MF Draft Legislation Brazil MF/LF intentions Spain Portugal CbCR Final Nigeria CbCR/MF/LF Final Legislation MF/LF intentions CbCR intentions CbCR Final Legislation Switzerland Italy South Africa CbCR Final CbCR Draft Austria Germany MF/LF intentions CbCR Draft Legislation Israel CbCR/LF Draft MF/LF intentions CbCR/MF/LF Final Legislation CbCR/MF/LF Final Legislation CbCR/MF/LF Final Legislation India CbCR Final MF intentions Malaysia CbCR Draft China MF/LF Draft Indonesia MF/LF intentions CbCR/MF/LF Final Legislation CbCR/MF/LF intentions Australia CbCR/MF/LF Final Legislation Japan CbCR/MF/LF Draft Legislation CbCR/MF/LF Final Legislation South Korea Hong Kong CbCR/MF/LF Final CbCR/MF/LF Public Consultation Vietnam CbCR/MF/LF Draft Legislation Singapore CbCR Draft Legislation New Zealand CbCR/MF/LF intentions Key: Implemented Draft bills/public discussion draft intentions to Implement Source: KPMG International member firms 1

3 BEPS Action 13: implementation summary 2

4 BEPS Action 13: implementation summary (1) Dates provided as an example for an entity with December 31st fiscal year end. (2) If a CbyC effective date is listed and filing date is BLANK, please see the Detail tab to determine the first filing deadline. 3

5 Countries with Final and Draft Legislation / Regulations / Public Discussion Draft 4

6 Australia -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding AUD 1 billion. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -It will still be determined in what language CbCR needs to be filed and Australia has adopted the OECD's XML Schema standardized electronic format. -The local entity will need to notify the local tax authority that the filing requirement will be satisfied through a parent/surrogate filing. Early indications are that the Australian entity will need to make a disclosure in the Local File to indicate which entity will be lodging the CbCR and MF. -The government announced a proposed increase of the maximum penalty for failure to file CbCR to A$450,000 (from a current maximum of A$4,500) and double the penalties for making false and misleading statements to the ATO. Criminal penalties could be due in exceptional cases. Master File -MF first filing year, filing requirements, revenue threshold, filing dates, and penalties are the same as for CbCR. Local File -LF revenue threshold, filing dates, and penalties are the same as for CbCR. -The requirement to submit a LF remains even if Australian entity has received a transitional exemption from the CbCR and/or MF obligation because the parent is not currently required (either because the rules have not been announced, or have been announced but not yet implemented, in the home jurisdiction) to provide a CbCR and/or MF in its home jurisdiction. -The ATO is proposing to implement two 'tiers' of the LF, which will limit the information to be disclosed, based on the size of international related party dealings (IRPDs), overall revenue of the Australian entity and transfer pricing risk of the entity. The LF requirements are in addition to existing transfer pricing compliance obligations. 5

7 Austria -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million for the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Only if an Austrian resident legal entity is required by formal notification to fulfill the obligations of the CbC report, the report can be based on 2017 information. -Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR should be filed in German, but English will also be accepted. Adoption of OECD's XML Schema standardized electronic format is anticipated. -Austrian entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. No specific form in the TPDC, however the Austrian Federal Ministry of Finance has published the form VPDG 1 on its homepage. This paper form can be used to meet the notification requirements. General penalties apply for failure to comply with notification requirements. -A maximum penalty of 50,000 applies for intent and up to 25,000 for gross negligence with CbCR. Master File -An Austrian entity will only fall under the MF documentation requirement if it has turnover exceeding EUR 50 million in each of the two preceding years. However, a MF must also be presented even if the Austrian entity will not exceed the revenue threshold but there is another group entity that must prepare a MF. -MF applies for fiscal years beginning on or after 1 January MF needs to be filed upon request by the tax authorities within 30 days. A request can only be made after the filing of the tax return for the relevant year. -Information to be presented in the MF should be in line with the new OECD standard and reflect the information specified in Annex I of the OECD s BEPS Action 13 final recommendations. -In general, the transfer pricing documentation is to be prepared in the German language. Master File and Local File according to TPDC are also acceptable in English language. No translation is required. Local File -Under the new legislation, an Austrian entity will only fall under the new LF documentation requirement if it has had a turnover exceeding 50 million in each of the two preceding years. For entities not exceeding this threshold, the documentation rules would remain unchanged, i.e., these entities would have to prepare transfer pricing documentation based on the administrative guidelines (but without the obligation to follow the formal requirements for preparing a separate MF and LF; the tax auditor could request a German translation). -LF timing, language and filing requirements are the same as for MF 6

8 Belgium -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -Filing in local language is not required and adoption of OECD's XML Schema standardized electronic format is anticipated. -Belgium entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. For fiscal year 2016 only, an extension until 30 September 2017 has been granted to file the notification. A notification form is available. -Penalties ranging from 1,250 to 25,000 will apply for noncompliance with CbCR and notification requirements. Master File -MF applies to a Belgium company or permanent establishment of a MNE group that satisfies one of the following criteria: 1) a sum of operational and financial income of 50 million; 2) balance sheet total larger than 1 billion; 3) FTEs exceeding MF first filing year, filing deadlines, and penalties are the same as for CbCR. -MF is required to be submitted to the tax authorities within a period of 12 months after the close of the reporting period of the group. Filling in English will be accepted. Local File -LF contents will have to be provided in a specific format consisting of two parts: i) general information that will have to be completed and filed by all companies or permanent establishments satisfying one of the three thresholds (listed above); and ii) more detailed information, providing mainly qualitative and quantitative information on the various sorts of intercompany transactions, will only be completed and filed by companies or permanent establishments that have cross-border intra-group transactions exceeding in total a value of EUR one million. Details on the format/content of the Local File are subject to the royal decree is anticipated. -LF should be filed together with the Belgian income tax return. -LF first filing year, filing threshold, language and penalties are the same as for MF. 7

9 Brazil -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding BRL 2,260,000,000 in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed with the corporate tax return (July 31st after calendar year closing). -CbCR will need to be provided in either Portuguese, Spanish or English. The OECD's XML Schema standardized electronic format has been adopted. -Notification should be provided in the same electronic file released by Federal Revenue which will contain the CbCR information and at the same date as the CbCR. -Two categories of penalties will apply: (i) BRL per month for failing to file or for not answering tax authority s request/clarification; and (ii) 3% on value of transaction for providing incorrect information/data. 8

10 Bulgaria -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding BGN 100 million (approx. 51 million) if the ultimate parent of the group is resident in Bulgaria, or BGN 1,466,872,500 (approx. 750 million) if the ultimate parent of the group is not resident in Bulgaria. -The effective date of CbCR depends on the date on which the draft legislation would enter into force. -Must be filed electronically no later than 12 months after the last day of the reporting fiscal year of the MNE group. -It needs to be determined in what language CbCR needs to be filed. -Bulgarian entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. -A filing entity that does not submit the report or fails to notify that it is unable to submit, is subject to a penalty of BGN 200,000. A penalty of BGN 150,000 applies if incomplete or incorrect data is submitted or when the ultimate parent of the MNE refused to provide the data. 9

11 Canada -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year end. -CbCR will need to be provided in local language and adoption of OECD's XML Schema standardized electronic format is anticipated -Canadian entities are allowed to act as a surrogate. -The legislation does not specify the need notify the local tax authority. The legislation only contemplates the notification by a surrogate parent entity to its local tax authority. -A penalty for failing to file the report would be CAD 500 per month for up to 24 months where no demand has been made. Where CRA has demanded the filing, the penalty is CAD 1,000 per month. 10

12 Chile -by-country reporting -Applies to MNEs headquartered in Chile with annual consolidated group revenue equal to or exceeding 750 million in the previous year. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 6 months after the last day of the reporting fiscal year of the MNE group. -CbCR must be filed in Spanish and it has not been determined whether the OECD's XML Schema standardized electronic format will be adopted. -Chilean entities are allowed to act as a surrogate. -Notifications need to be submitted 30 days before filing deadline of the CbCR. Notifications are only required by Chilean headquartered companies and need to be submitted in Spanish in a template defined by the tax authorities. -A maximum penalty of CLP 27,500,000 and criminal penalties may apply for noncompliance with CbCR and notification. Local File -Intention to require LF through the filling of a questionnaire (e.g. as an appendix to the current transfer pricing sworn return). 11

13 China -by-country reporting -Applies where an enterprise is the ultimate holding company (UHC) of a MNE and the group has consolidated revenue equal to or exceeding RMB 5.5 billion in the previous year, or the entity has been designated by the MNE group. -Applies for fiscal years beginning on or after 1 January CbCR must be filed together with PRC Annual Reporting Forms on related party transactions (RPT) on May 31 of the year following the covered tax year. -CbCR will need to be provided both local language and English and adoption of OECD's XML Schema standardized electronic format is anticipated. -Chinese entities are allowed to act as a surrogate. -The local entity needs to notify the name of its ultimate holding company to the local tax authority on RTP Form. The RTP Form should be filed before 31 May each year. There is no explicit requirement to notify the local tax authority that the filing requirement will be satisfied through a parent/surrogate filing. -Filing of a substantially incomplete/inaccurate report would be subject to penalties of RMB 10,000 and in serious cases, up to RMB 50,000. Master File -MF must be prepared if (i) the cross-border RPT and the group to which the enterprise s UHC belongs has already prepared a MF, or (ii) total annual amount of RPT exceeds RMB 1 billion. -MF applies for fiscal years beginning on or after 1 January MF must be prepared within 12 months of the year end and shall be submitted within 30 natural days of request. -MF must be prepared in Chinese or translated into Chinese. -A penalty of RMB 10,000 will apply for noncompliance. -The MF requirements are broadly in line with the BEPS proposals and includes an additional requirement to provide the name and the location of the legal entity preparing and filing CbCR for the group. Local File -LF must be prepared if (i) transfers of tangible assets exceed RMB 200 million; (ii) transfers of financial assets exceed RMB 100 million; (iii) transfer of ownership of intangible assets exceed RMB 100 million; or (iv) all other RPT exceed RMB 40 million. -LF effective year, language and penalties are the same as for MF. LF must be prepared by 30 June following the tax year in question and shall be submitted to the tax authorities within 30 natural days of request. -The Chinese LF rules include elements in addition to what the BEPS LF requires (e.g., Value Chain Analysis, location specific advantages, etc.). 12

14 Colombia -by-country reporting -Applies to MNEs with a tax residence in Colombia and annual consolidated group revenue equal to or exceeding UVT 81 million (approx. COP 2,400 billion) in the previous year. -Applies for fiscal years beginning on or after 1 January Annual filing date and details, language requirements, the possibility to act as a surrogate, notification requirements, and penalties have not been determined yet. Master File/Local File -A tax reform bill introducing MF and LF as part of the transfer pricing supporting documentation was enacted. Further details are yet to be released. 13

15 Croatia -by-country reporting -Applies to MNEs headquartered in Croatia with annual consolidated group revenue equal to or exceeding 750 million in the previous year. -CbCR applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. First report for the fiscal year that starts on or after 1 January 2016, is due within 18 months after the end of the fiscal year. -The language has not been specified and Croatia has not adopted the OECD's XML Schema standardized electronic format yet. -Current law does not provide for surrogate reporting or notification requirements. This might change when new regulations are published (expected by the end of January 2017). -Penalties ranging between HRK 2,000 to HRK 200,000 will apply for noncompliance. 14

16 Cyprus -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January The annual filing date is 15 months as from the end of the reporting fiscal year. The filing date of the first fiscal year is extended by 3 months. -Language requirements have not been determined yet and Cyprus has adopted the OECD's XML Schema standardized electronic format. -Cyprus entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. An extension has been granted for the first fiscal year. The deadline is 20 October Penalties have not been determined yet. 15

17 Czech Republic -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in local language and it is unclear whether it will be possible to report in English. Adoption of OECD's XML Schema standardized electronic format is anticipated. -Czech entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year and within 15 days if any change in reporting entity occurs. An extension for the first fiscal year has been granted. The new deadline is 30 September The notification duty will be fulfilled by filing a notification form, which will be published by the Ministry of Finance. -Penalties up to CZK 3 million will apply for noncompliance. Master File -There is no clear indication that the tax authority will require obligatory annual filing requirements for transfer pricing documentation in Local File -Same as MF 16

18 Denmark -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding DKK 5.6 billion in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal year beginning on or after 1 January For groups where the ultimate parent company/surrogate/representative is not resident in Denmark, the rules apply on or after 1 January Must be filed no later than 12 months after the last day of such reporting year. -CbCR can be provided in Danish, Norwegian, Swedish, or English and Denmark has adopted the OECD's XML Schema standardized electronic format. -Danish entities are allowed to act as a surrogate. -Danish entities are required to notify the tax authorities by the end of the fiscal year whether the company itself is required to submit CbCR in Denmark or which group company is required to file CbCR. Notification must be submitted in a standardized format, i.e. Form , through the secure digital communication line via "Kontakt" in "TastSelv Erhverv". The form is in Danish and English. -Legislation makes it formally possible to issue penalties but it is not currently possible to determine the actual amount. Master File -Group will be exempt from MF (and LF) if all group entities, i.e. not only group entities in Denmark, have less than 250 employees, and, either a total balance of less than DKK 125 million, or, a turnover less than DKK 250 million. There are certain exemptions from this. -Taxpayers are required to prepare the documentation contemporaneously, as the company is required to be able to submit the documentation at the same time as the tax return. However, the documentation need only to be submitted after request and within 60 days from the day the company received such request. -Penalties apply at a base price of DKK 250 million per year plus additional penalty which is linked to the income adjustment, if any (additional 10 percent of increased income). -The documentation is required to follow the OECD Action 13 guidance for MF. - MF can be provided in Danish, Norwegian, Swedish, or English Local File -LF revenue threshold, filing dates, language and penalties are the same as for MF. 17

19 Estonia -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the preceding year. Regulations extend to subsidiary entities. -Applies to reporting fiscal year The first filing date is the end of year 2017 for the report covering the reporting entity's fiscal year It needs to be determined in what language CbCR needs to be filed and adoption of OECD's XML Schema standardized electronic format is anticipated. -Estonian entities are allowed to act as a surrogate. -The entity needs to notify the local tax authority within six months starting from the end of the entity's reported FY. Failing to provide the notification within the required time frame, may result in the local entity belonging to the reporting group tax being required to provide the CbC report. -A penalty of 3,300 applies. 18

20 Finland -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can be provided in Finish, Swedish, or English and adoption of OECD's XML Schema standardized electronic format is anticipated. -Finnish entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. An extension has been granted for the first fiscal year. The new deadline is 31 May There will be two alternative ways to submit CbCR and the notification. An internet page will be launched in the beginning of the year 2017 and the second alternative will be released later in the spring 2017 utilizing Katso identification system. The second alternative will be following the OECD XML schema recommendation and will be code based (all electronic filing) in contrast to the first option. -A maximum penalty up to 25,000 will apply for noncompliance with CbCR and notifications. Master File -No specific thresholds apply. If the entity is liable to prepare a transfer pricing documentation, the Master File needs to be prepared. Small and medium sized companies as defined in EU Commission Recommendation (2003/361/EC) are exempted from preparing transfer pricing documentation. -MF applies for fiscal years beginning on or after 1 January MF and LF need to be prepared on a annual basis, but only provided to the tax authorities upon request. -Penalties and language are the same as for CbCR. Local File -LF revenue threshold, filing dates, language and penalties are the same as for MF. 19

21 France -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the current year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can be provided in English, but the French tax authorities have the right to request translation into French. France has not adopted the OECD's XML Schema standardized electronic format yet. -French entities are allowed to act as a surrogate. -The French entities subject to the CbCR obligation must mention in their annual corporate income tax return whether they have this obligation, as well as indicating whether they will be making the filing. When another entity has been elected to file the CbCR, the name and location of this entity must be indicated on the French company s corporate income tax return. -A penalty of maximum 100,000 will apply for noncompliance with CbCR and notification requirements. -A failure to file CbCR could potentially trigger tax audits. 20

22 Germany -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning after 31 December Surrogate rules and filing obligation for local entity will only apply with one year delay. -Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -It needs to be determined in what language CbCR needs to be filed and adoption of OECD's XML Schema standardized electronic format is anticipated. -German entities are allowed to act as surrogate entities. -The subsidiary has to declare in its tax return the name of the MNE's headquartered entity and the competent authority to which it has submitted the CbCR. Notification needs to be made in German. -A maximum penalty of 10,000 applies. Master File -MF required if German taxpayer's sales exceed 100 million. -MF applies for fiscal years beginning after 31 December Submission to the local tax authorities is not required. Typically to be submitted upon request during a tax audit. -Standard sanctions for non or insufficient MF documentation will apply, including penalties and reversal of burden of proof. Local File -Decree law of LF expected later in Content expected to overlap largely with existing German documentation requirements, though timing and frequency of preparation may change. -First filing year and penalties are the same as for MF. -LF should generally be filed in German but foreign language (typically English) may be applied for. 21

23 Hungary Master File / Local File -The Hungarian authorities plan to implement any measure of BEPS Action 13 early A first non-public draft on MF and LF is already available. CbCR is not mentioned in this draft. 22

24 Iceland -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding ISK 100 billion in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed before the end of the calendar year (31 December) following the accounting year of the Company. -It needs to be determined in what language CbCR needs to be filed and Iceland has not adopted the OECD's XML Schema standardized electronic format yet. -It has not been determined whether Iceland will act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. A notification form has not been released yet. -Applicable penalties have not been determined yet. Master File -Regulations are expected to be ready and enter into force 1 January Local File -Regulations are expected to be ready and enter into force 1 January

25 India -by-country reporting -CbCR is expected to apply to MNEs with annual consolidated group revenue equal to or exceeding 750 million. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 April CbCR should be filed with the income return within eight months following the last day of the fiscal year end (31 March 2017) i.e. by 30 November It still needs to be determined in what language CbCR needs to be filed and India has not adopted the OECD's XML Schema standardized electronic format yet. -Indian entities are allowed to act as a surrogate. -The Indian entity with a foreign parent has to notify the Indian prescribed authority in the form and manner, on or before such date, as may be prescribed (detailed guidelines awaited), whether it is the alternate reporting entity (surrogate) of the international group, or, the details of the parent entity or the alternate reporting entity (surrogate), of the international group, and the country or territory of which the said entities are resident. -Penalties up to INR500,000 will apply. Master File -MF is expected to be adopted; however, the detailed guidelines/rules as to form, threshold etc. of MF will be released later. -First fiscal year and penalties are the same as for CbCR. Local File -The Finance Bill 2016 stated that new prescribed documentation will be adopted in India and may be defined in detailed guidelines/rules to be released at a later date. LF will be a part of this, more information to follow once released. -First fiscal year is the same as for CbCR. 24

26 Ireland -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Exemptions are only permitted if the Ultimate Parent's home country has a voluntary CbC reporting framework under which the Group agrees to file under. -Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in local language and Ireland has not adopted the OECD's XML Schema standardized electronic format yet. -Irish entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year via Revenue Online System (ROS). No penalties currently associated with the failure to notify. -Penalties of 19,045 plus 2,535 per day that the filing is late will apply. 25

27 Israel -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding ILS 3.4 billion. Regulations extend to subsidiary entities. -CbCR is expected to apply as of Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -The language has not been specified yet, but English should be acceptable. Adoption of OECD's XML Schema standardized electronic format is anticipated. -It has not been determined whether Israel will act as a surrogate. -Penalties will apply. Local File -The draft legislation in Israel was released very recently and is exceptionally brief. It is currently understood that the intention is to remain faithful to OECD Action 13 guidance. Further detail is expected as the regulations are finalized. 26

28 Italy -by-country reporting -Applies to MNEs headquartered in Italy with annual consolidated group revenue equal to or exceeding 750 million. -CbCR likely applies for fiscal years beginning on or after 1 January Filing of CbCR will likely be with the tax return submission date, i.e., the end of the ninth month after year end. -The language has not been specified yet and adoption of OECD's XML Schema standardized electronic format is anticipated. -It has not been determined whether Italy will act as a surrogate. -Notification requirements have not been determined yet. -A penalty of maximum 50,000 will apply. 27

29 Japan -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding Yen 100 billion in the previous year. Regulations extend to subsidiary entities or and foreign owned entities (or permanent establishments) under certain conditions. -Applies for fiscal years beginning on or after 1 April Must be filed via E-Tax no later than 12 months after the last day of the ultimate parent fiscal year end. -CbCR cmust be provided in English and Japan has adopted the OECD's XML Schema standardized electronic format. -The tax authority can technically act as a surrogate to accept and disperse the CbCR information of foreign multinational groups obtained in Japan through the Japanese affiliate to foreign tax authorities under the automatic information exchange treaties, although, it is not certain if the tax authority will act as a surrogate on a regular basis. -The entity needs to notify the tax authorities regarding surrogate filings via e-tax by the last day of parent's fiscal year. Entities with fiscal years ending after January but before April 1, 2016, will not have a notification requirement for the current year -A maximum penalty of JPY 300,000 will apply for noncompliance. Master File -First filing year, revenue threshold, filing dates and penalties are the same as for CbCR. -Virtually the same as Master File proposed in the OECD Action 13 -MF must be prepared in Japanese or English and submitted electronically via e-tax. Local File -A taxpayer with intercompany transactions of less than JPY 5 billion for the prior fiscal year (i.e., the total amount of both payment and receipt) and intangible transactions of a value of less than JPY 300 million in the prior fiscal year is exempt from the LF. Additional support may be required for intercompany prices if LF is not required. -There is no requirement for the scheduled submission of the LF. However, LF must be prepared on an annual basis by the due date for filing the taxpayer s tax return and submitted upon request within 45 days. -Applies for fiscal years beginning on or after 1 April A penalty in the form of a presumptive taxation may be imposed when a taxpayer fails to submit the LF upon request. 28

30 Jersey -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. Consideration is being given to extending the date by which first report must be submitted. CbCR language has not been specified yet, but will likely be required in English since legal documents in Jersey are required to be maintained in English. Adoption of OECD's XML Schema standardized electronic format is anticipated. -Jersey entities are allowed to act as a surrogate. -The Jersey entity is required to notify the Comptroller of Taxes on or before the last day of its accounting period of its intention to file CbCR in respect of its accounting period. -The following penalties will apply: i) failure to file CbCR by the due date or failure to notify the Comptroller of Taxes on or before the due date of the intention to file a CbCR in respect of a certain accounting period - 300; ii) Failure to file CbCR by the due date - 60 per day but may be increased to an amount not exceeding 1,000 per day should the default continue for more than 30 days; and iii) knowingly providing inaccurate information when filing CbCR and failing to inform the Comptroller of Taxes or after discovering such inaccuracy failing to take reasonable steps to inform the Comptroller of Taxes - amount not exceeding 3,

31 Lithuania -by-country reporting -Applies to Lithuanian entities with annual consolidated group revenue equal to or exceeding 750 million in the previous year. There is no text stating that CbCR must be filed by the parent company. -The effective year has not been determined yet. -Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -It needs to be determined in what language CbCR needs to be filed and the OECD's XML Schema standardized electronic format has not been adopted yet. -It has not been determined if entities are allowed to act as a surrogate. -Notification information is not available yet. -Penalties ranging between 150 to 300 will apply. 30

32 Luxembourg -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can be filed in English and Luxembourg has not adopted the OECD's XML Schema standardized electronic format yet. -Luxembourgish entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year (deadline however exceptionally extended to March 31, 2017 instead of December 31, 2016). Notification is to be made via e-notification through "guichet.lu". -A maximum penalty of 250,000 in case of wrong/late filing can be applied. In addition the extended statute of limitations for tax audits may be extended to 10 years. 31

33 Malaysia -by-country reporting -Malaysia Inland Revenue Board is keen to adopt CbCR. CbCR would form part of the Malaysian tax legislation once the recently introduced Finance Bill 2016 is gazetted. Revised guidelines and new legislation have not yet been introduced. However, these are expected to be in line with OECD BEPS Action 13 without major changes or alterations, to the extent applicable locally. -Expected to apply to MNEs (parent/surrogate) with annual consolidated group revenue equal to or exceeding 750 million (RM 3 billion) in the previous year. -Expected to apply for fiscal years beginning on or after 1 January CbCR should be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. CbCR should be provided in English and adoption of OECD's XML Schema standardized electronic format is anticipated. -Malaysian entities are expected to be allowed to act as a surrogate. -Notification requirements have not been determined yet. -Penalties between RM20,000 to RM100,000 will apply. Imprisonment for a term not exceeding 6 months is possible. Master File -Expected to apply for fiscal years beginning on or after 1 January The current timeline for the submission of local transfer pricing documentation is 30 days upon such request. This timeline is expected to remain unchanged. -Language requirement is expected to be in line with that of the local transfer pricing documentation requirement, English or Bahasa Malaysia. 32

34 Malta -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January If the ultimate parent entity is not obliged to file CbCR in its home country, the Maltese constituent entity is exempted from filing the first year's CbCR. -Must be filed within nine months of the last day of the fiscal year of the MNE group. -Filing in local language is not required and adoption of OECD's XML Schema standardized electronic format is anticipated. -Maltese entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the last day of filing the tax return for the relevant fiscal year. There is no specific form of notification provided in the implementing regulations. The Maltese tax authorities will typically accept a letter from a director of the local entity. -A maximum penalty of 50,000 will apply for noncompliance. 33

35 Mexico -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding MXN 12,000 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in Spanish and Mexico has not adopted the OECD's XML Schema standardized electronic format yet. -Mexican entities are allowed to act as a surrogate. -Notification to the SAT only takes place if a Mexican subsidiary has been appointed to file CbCR. -Penalties ranging between MXN 140,540 to MXN 200,090 will apply for noncompliance. The extended statute of limitations for tax audits may be extended to 10 years. Other penalties include a ban to be a supplier of the public sector, withdrawal of the importer permit, and limitation to use the Tax identification number. Master File -MF applies to taxpayer with revenues equal to or exceeding MXN 644,599,005; Corporate taxpayers whose shares are listed and quoted on public stock exchanges; Taxpayers subject to the Optional regime for groups of corporate taxpayers that are subject to certain provisions ; Government entities; and, Foreign taxpayers with PE in Mexico, but only with respect to the activities conducted by that PE. -MF first fiscal year and penalties are the same as for CbCR. -MF is required to be submitted annually by December 31 of the following year for which the report is required. -MF needs to be filed in local language. Local File -LF first fiscal year, language and penalties are the same as for MF. -LF must be submitted by December 31, 2017 with regard to the information of fiscal year ending December 31, 2016, but transfer pricing documentation must be contemporaneous with the 2016 income tax return. -There are some formal documentation requirements included in the documentation report that are not part of the LF and vice versa. 34

36 Netherlands -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can to be provided in English and the Netherlands have adopted the OECD's XML Schema standardized electronic format. -Dutch entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. An extension has been granted for the first fiscal year. The new deadline is 1 September Penalties will be imposed in instances of intentional non-compliance or serious misconduct with CbCR, with a potential maximum penalty in the amount of 20,250, in addition to possible criminal prosecution. Master File -MF applies to MNEs with annual consolidated group revenue equal to or exceeding 50 million. -MF applies for fiscal years beginning on or after 1 January Requirement to maintain a MF within the deadline imposed for the filing of corporate income tax return for the year to which the tax return relates. The MF can be prepared in English. -Non compliance would result in a reversal of the burden of proof. Local File -LF filing requirements, language and penalties are the same as for MF. -Regular transfer pricing documentation must be maintained if annual consolidated revenue is less than EUR 50 million. 35

37 Norway -by-country reporting -Applies to Norwegian ultimate parent companies of a multinational group with annual consolidated group revenue equal to or exceeding NOK 6.5 billion in the previous year. Regulations extend to subsidiary entities. The reporting requirement could also affect foreign group entities that are resident in Norway, if certain conditions are met. -Applies for fiscal years beginning on or after 1 January Secondary filing applies for years starting 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can be provided in English and adoption of OECD's XML Schema standardized electronic format is anticipated. -It will be determined if Norwegian entities can act as a surrogate. -The parent is required to notify its local authority and the relevant country must have entered into an agreement on automatic exchange with Norway. When a foreign parent company in the group has an obligation to file CbCR in its country of residence, the Norwegian entity must notify the Norwegian tax authorities within the same time period as that for tax reporting i.e., by 31 May. The duty to notify will be in effect from fiscal year 2016 and will be part of the annual tax reporting from the company (i.e., the first time by end of May 2017). -Failing to file a report within the statutory deadlines are covered by the general sanctions in the tax administrative law. There will not automatically be a penalty imposement. Albeit non-filing or filing of misleading report will be taken into consideration in the total evaluation concerning penalty imposement. 36

38 Pakistan -by-country reporting -Applies to all taxpayers who have entered into any transaction with an associate. The format of CbCR has not been specified yet. -Applies for fiscal years beginning on or after 1 July Filing is on 'demand' basis, when required by the Commissioner. -CbCR can be provided in English and the adoption of the OECD's XML Schema standardized electronic format is anticipated. -It has not been determined if Pakistan will act as a surrogate. -There are no notification requirements -The penalty for non-maintenance of records required by the law or the tax rules is higher of Rupees 10,000 or five percent of tax on income. Master File -MF will be effective on or after 1 July 2016, however a format has not been specified yet. -MF is to be maintained for all transactions without any minimum requirement of threshold. -MF needs to be submitted within 30 days of demand by the Commissioner. -Penalties are the same as for CbCR. Local File -Filing deadlines, threshold, effective date and penalties are the same as for MF. 37

39 Papua New Guinea -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 2 million Kina in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in English and Papua New Guinea has not adopted the OECD's XML Schema standardized electronic format yet. -Entities are allowed to act as a surrogate. -The entity needs to notify the tax authorities by the end of the fiscal year. No details are available yet. For CbCR itself, it must be "in a form identical to and applying the definitions and instructions contained in the standard template set out at Annex III of Chapter V of the OECD Guidelines as modified from time to time and Annex III of the final report on BEPS Action 13. -Penalties have not been determined yet. 38

40 Peru -by-country reporting -Applies to taxpayers that are part of a multinational group. Threshold has not been defined yet. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January The annual filing date has not been determined yet. -CbCR must be filed in local language and adoption of the OECD's XML Schema standardized electronic format is anticipated. -It has not been determined whether Peru will act as a surrogate. -Notification requirements have not been determined yet. -The penalties for failing to report have not been published yet. However, the penalty for failing to keep the information related to CbCR is US$ 25,000 Master File -MF applies to companies which belong to an economic group with consolidated revenues higher than 20,000 Tax Unites (equivalent to US$ 20 MM). -The first fiscal year requiring MF preparation is The exact deadlines, thresholds and penalties for non-compliance have not been defined yet. However, the penalty for failing to keep the information supporting the MF Informative Return is around US$ 25,000. -Language requirement is the same as for CbCR. Local File -The LF Informative Return is mandatory for companies with revenues greater than US$ 2.3 MM (approx.). -The first fiscal year requiring LF preparation is FY The exact deadlines, thresholds and penalties for non-compliance have not been defined yet. However, the penalty for failing to keep the information supporting the MF Informative Return is around US$ 25,000. -Language requirement is the same as for CbCR. 39

41 Poland -by-country reporting -Under the current regulations, CbCR applies to MNEs headquartered in Poland with annual consolidated group revenue equal to or exceeding 750 million. Regulations extend to subsidiary entities in proposed regulations. -Applies for fiscal years beginning after 31 December Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR needs to be provided in local language and adoption of OECD's XML Schema standardized electronic format is anticipated. -Poland does not provide for the possibility to act as a surrogate in current regulations but the possibility is being introduced in proposed regulations. -There are no notification requirements in current regulations but the possibility is being introduced in proposed regulations. Under the proposed regulations for the reporting period beginning after 31 December 2015 but no later than on 31 December 2016 the notification is to be filed within 10 months since the end of that period. -Potential penalties stem from the Penal-Fiscal Code and could include (i) a maximum penalty of PLN 17,760,960; (ii) prohibition of conducting certain business activities; (iii) imprisonment; forfeiture of property. Master File -MF applies to taxpayers with revenues/cost in the previous year exceed 20,000,000. -MF applies for fiscal years beginning after 31 December No requirement to submit the MF but Taxpayers should be in possession of the MF no later than the filing of the annual tax return. Upon request, the MF has to be submitted upon request within 7 days. -Failure to submit the MF within the specified deadline might result in a 50 percent tax rate to the assessed income. -MF will need to be provided in Polish. Local File -LF applies for taxpayers whose revenues/costs are equal to or exceed 2,000,000 (benchmarking analyses: 10,000,000). Additionally, a materiality threshold applies. -LF should be prepared by the day of filing of the annual tax return. Together with the tax return, taxpayers file a statement that they are in possession of the LF. -LF filing requirements and first fiscal year are the same as for MF. Penalties and language are the same as for MF and CbCR. 40

42 Portugal -by-country reporting: -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -It is expected that the CbyC report will be submitted in Portuguese language. -Portugal has not adopted the OECD's XML Schema standardized electronic format yet. -Portuguese entities are allowed to act as a surrogate. -Taxpayers need to notify the tax authorities by the end of the fiscal year the identification and the country or tax jurisdiction of the reporting entity. An extension has been granted for the first fiscal year. The new deadline is 31 May Penalties up to 10,000 will apply. 41

43 Russia -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding RUB 50 billion. Regulations extend to subsidiary entities. -CbCR is going to be mandatory applicable for fiscal years beginning on or after 1 January CbCR is going to be optional for calendar year Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR needs to be provided in local language. The current draft law allows filing CbCR in foreign language for groups whose parent entity is not a Russian resident. Adoption of OECD's XML Schema standardized electronic format is anticipated. -It has not been determined whether Russia will act as a surrogate. Russia will still require a taxpayer to file CbCR even if it is not required in the jurisdiction of its parent entity; however, there is no information whether Russia will distribute it further. -The current draft law frees a local tax resident from filing CbCR if the Group already filed it in the jurisdiction which is a part of automatic CbCR exchange treaty and does not systematically fail to share CbCR with other countries -All constituent entities resident in Russia are required to provide a notice of participation in a multinational group to the Russian tax authorities within 3 months since the end of the last financial year. Failure to provide the notice or providing incorrect information will result in a penalty of up to RUB 50,000 (penalty not applicable for ). -Penalties up to RUB 100,000 will apply for failing to submit CbCR when required or submitting incorrect information (penalty not applicable for ). Master File -MF revenue threshold and penalties are the same as for CbCR. -The MF must be provided by the Russian tax payer which is member of the MNE, or by a parent company or an authorized member of the MNE in case they are Russian tax residents, if required by the tax authorities, and turned over within three months from the date of the tax authorities request, but not earlier than 15 months from the date on which the financial year ends. Local File -LF revenue threshold is the same as for CbCR. -The LF must be provided by a Russian company or a foreign company that is a Russian tax resident if required by the tax authorities, and turned over within three months from the date of the tax authorities request, but not earlier than 15 months from the date on which the financial year ends. 42

44 Singapore -by-country reporting -Applies to MNEs headquartered in Singapore with annual consolidated group revenue equal to or exceeding SGD 1,125 million. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR to be provided in English. Adoption of OECD's XML Schema standardized electronic format is anticipated. -Singapore does not see a need to provide for surrogate filing for foreign MNE groups. Only Singapore MNE groups are required to submit CbC reports to IRAS. - Notifications are not required but further details are to be announced by IRAS. -If a company required to file CbCR fails to do so by the due date, IRAS may take the following actions: (I) Impose a fine of up to $1,000, (ii) If this fine is not paid, the person responsible for the offence may be imprisoned for up to six months, (iii) Impose a further fine of up to $50 for every day during which the offence continues after conviction. A company which provides false or misleading CbC information may face the following consequences: (i) A fine of up to $10,000; and/ or (ii) Person responsible for the offence may be imprisoned for up to two years. 43

45 Slovakia -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities -Applies for fiscal years beginning on or after 1 January For groups where the ultimate parent company is not resident in Slovakia, the rules may only apply to fiscal years commencing on 1 January 2017 or later. -Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in local language and adoption of OECD's XML Schema standardized electronic format is anticipated. -Slovakian entities are allowed to act as a surrogate. -Deadline for notification is same as deadline for submission of the corporate income tax return, i.e. 3 months following the end of the fiscal year (3 or 6 month extension is available). The notification has to be in the Slovak language, no specific form. Penalties up to 3,000 apply for failing to submit the notification. -Penalties up to 10,000 will apply for noncompliance with CbCR requirements. 44

46 Slovenia -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January There are no requirements (also for CbC notifications) in Must be filed no later than 12 months after the last day of the reporting fiscal year. -Slovenian entities are allowed to act as a surrogate. -Further information regarding CbCR format (including notification form and filling deadlines) will be provided by Slovene Ministry of Finance in the beginning of According to informal information notifications in respect to FY 2016 should be submitted to Slovene Tax Authorities as part of the regular CIT return (i.e. as an Appendix), this is in general until March if the FY is the same as the calendar year. -Penalties up to 30,000 for legal entity and up to 4,000 for responsible person of the legal entity will apply. 45

47 South Africa -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding ZAR 10 billion in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR can be provided in English and adoption of OECD's XML Schema standardized electronic format is anticipated. -South African entities are allowed to act as a surrogate. Where the ultimate holding company is not resident for tax purposes in South Africa, the revenue threshold is EUR 750 million. -Notification to the South African tax authorities is required no later than 12 months after the last day of the Reporting Fiscal Year. -Penalties are applied on a sliding scale per month, depending on the taxable income (or if assessed loss) for the preceding year. The maximum monthly penalty is ZAR 16,000. Master File/Local File -Adoption of Master File/Local File format is anticipated. 46

48 South Korea -by- reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding KRW 1 trillion in the current year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -The language has not been specified yet and South Korea has not adopted the OECD's XML Schema standardized electronic format yet. -South Korean companies can act as a surrogate. -Reporting entity notification form must be filed no later than 6 months after the last day of the reporting fiscal year of the MNE group. CbCR notification requirement will be controlled by the fiscal period of Korean subsidiary, and that of ultimate parent company will not affect to the CbCR notification requirement which Korean subsidiary shall comply to. -Penalty of KRW 10,000,000 will apply for if the threshold is met and the report is not submitted. Master File -MF applies to all domestic corporations and foreign corporations with permanent establishments in Korea having where the Korean entity has net sales greater than KRW 100 billion and that conduct cross border related party transactions exceeding KRW 50 billion per year. -First fiscal year and filing requirements are the same as for CbCR. -MF is required to be submitted to tax authority 12 months after fiscal year end. -MF may be initially submitted in English but must be submitted in Korean within one month of the submission of the English MF. -Penalties are the same as for CbCR. Additional documents that Korean tax authorities requests must be submitted with 60 days. Otherwise, the taxpayer may be subject to a noncompliance penalty of up to KRW 100 million. Local File -First fiscal year, filing deadlines, revenue threshold, and penalties are the same as for MF. -LF has to be submitted in Korean. 47

49 Spain -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year end. -It will still be determined in what language CbCR needs to be filed and if Spain will adopt the OECD's XML Schema standardized electronic format. -Spanish entities are allowed to act as a surrogate. -Spanish legal entities are required to notify the Spanish tax authorities before their fiscal year end which legal entity of the MNE will be filing CbCR and in what capacity (parent, surrogate or required affiliate). An online form is available. -It will still be determined if penalties apply. Master File -Applies to Spanish MNEs with revenues equal to or exceeding 45 million. -Applies for fiscal years beginning on or after 1 January MF should be available to the tax authorities by the income tax return filing deadline (six months and 25 days after the taxpayer's fiscal year-end). Taxpayers are not required to file their documentation, but the Spanish tax authorities may request the document after the CIT deadline. -The Spanish tax authorities may require the document in Spanish. -The lack of a MF may result in a formal penalty of 1,000 per omitted, wrong or false data item, or 10,000 per 'group' of data items. The formal penalties are capped at the least of 10 percent of taxable income or one percent of net revenue. Further, if the tax authorities assess a transfer pricing adjustment and the taxpayer does not have a MF, a penalty of 15 percent of the assessment will be levied. Local File -LF effective year, language and penalties are the same as for MF. -Regulations allow for the preparation of a 'simplified' LF for taxpayers with an aggregate group revenue that does not exceed 45 million. A super simplified LF may be filed by taxpayers with revenue of less than 10 million. -The LF requirements are aligned with Action 13 and are largely consistent with the transfer pricing documentation requirements applicable until December 31,

50 Sweden -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding SEK 7 billion in the previous year. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in Swedish, Danish, Norwegian, or English and Sweden has adopted the OECD's XML Schema standardized electronic format. -Swedish entities are allowed to act as a surrogate. -Swedish entities must notify STA at the end of year which group entity will be filing CbCR for the group. An extension has been granted for the first fiscal year. The new deadline is April 30, The draft legislation does not yet provide additional detail on the form of notification. -It will still be determined if penalties apply. Master File -Applies to companies with more than 250 employees and a group turnover of less than SEK 450 million, or a consolidated balance sheet total of less than SEK 400 million. -Applies for fiscal years beginning on or after 1 April The documentation should be available by the time when the tax return should be filed (normally 1 July). No monitoring will be performed (unless the documentation is requested when reviewing the tax return or in a tax audit). -MF can be prepared in Swedish, Danish, Norwegian or English. Local File -LF first fiscal year, revenue threshold, filing dates, language and penalties are the same as for MF. 49

51 Switzerland -by-country reporting - Applies to MNEs with annual consolidated group revenue equal to or exceeding CHF 900 million in the previous year (EUR 750 million equivalent based on FX rate on 1 January 2015). Regulations extend to subsidiary entities. - Applies for fiscal years beginning on or after 1 January 2018 (depending timely enacting of new law). - Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. For years prior to 2018, Swiss ultimate parent companies can file their CbCR voluntarily with the Swiss competent authorities (depending timely enacting of the new law until end of 2017). -CbCR can be provided in English, German, French, Italian, or Romansh and adoption of OECD's XML Schema standardized electronic format is anticipated. - Swiss entities are allowed to act as a surrogate. - The entity needs to notify the tax authorities by the end of the fiscal year from 2018 onwards. Before, notification as filer with Switzerland for FY2016 reports is to be done no later than 31 December 2017 i.e. with the voluntarily filing of the FY2016 report. - Penalties up to CHF 250,000 will apply for non-compliance with the new law once enacted. 50

52 Turkey -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding TRY 2.37 billion. Regulations extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR will need to be provided in local language and adoption of OECD's XML Schema standardized electronic format is anticipated. -It has not been determined whether Turkish entities can act as a surrogate. -Notification requirements have not been determined yet. -A penalty of TRY 1,370 will apply. Master File -MNEs having (1) an asset value of a minimum of TRY 250 million at the close of the previous fiscal year and (2) a turnover of TRY 250 million or more, are required to prepare a MF by the end of the second month following the due date for filing of the corporate income tax return. -First filing year and penalties are the same as for CbCR. Local File -All group entities that are tax residents in Turkey and which have cross-border intercompany transactions are required to file a LF. In addition, companies with a minimum asset value at the end of previous fiscal year and turnover of TRY 100 million, would be required to submit a form providing detailed information regarding related parties and related party transactions. -LF should be prepared by the end of the corporate tax return filing (April 25 for calendar year accounting periods) but submitted upon the request of tax authorities within 15 days (might be extended to 30 days). -There is no material deviation from the LF content of Turkish law and OECD Action 13 LF content. -First filing year and penalties are the same as for CbCR. 51

53 United Kingdom -by-country reporting -Applies to MNEs with annual consolidated group revenue equal to or exceeding 750 million in the previous year. Regulations extend to subsidiary entities. The scope of the report in this case is limited to the sub-group beneath the top UK entity. -Applies for fiscal years beginning on or after 1 January Must be filed no later than 12 months after the last day of the reporting fiscal year of the MNE group. -CbCR language has not been specified yet and adoption of OECD's XML Schema standardized electronic format is anticipated. -Possibility to act as a surrogate as long as there is a U.K. constituent entity to act as surrogate and a relevant election is made before the filing date for the CbCR. -The entity needs to notify the tax authorities on or before the CbCR filing deadline for that U.K. constituent entity. -Penalties for noncompliance with CbCR and notification requirements ranging from 300 to 3,000 with daily penalties for continued failure to provide information. -All UK constituent entities are required to file CbCR unless they qualify for an exemption. A condition of the exemption is that notification is made to HMRC. Therefore failure to notify results in the entity being required to submit a UK CbCR, and the normal late filing penalties may apply. 52

54 United States -by-country reporting -Applies to MNE in the U.S. with annual consolidated group revenue equal to or exceeding $850 million in the previous year. A U.S. territory ultimate parent entity may designate a U.S. business entity that it controls to file on its behalf. -Applies for fiscal years beginning on or after 30 June Must be filed on or before the due date (including extensions) for the annual tax return. -Must be provided in English and the United States has not adopted the OECD's XML Schema standardized electronic format yet. -The United States does not provide for the possibility to act as a surrogate. -Penalties ranging between $10,000 and $50,000 will apply for noncompliance with CbCR, including reasonable cause relief for failure to file. 53

55 Uruguay -by-country reporting -CbCR revenue threshold has not been determined yet. Regulations likely extend to subsidiary entities. -Applies for fiscal years beginning on or after 1 January Filing dates are not available yet. -Filing language has not been determined yet and adoption of OECD's XML Schema standardized electronic format is anticipated. -Uruguay entities are allowed to act as a surrogate. -Notification requirements have not been determined yet. -Penalties up to $250,000 will apply. Master File -First fiscal year and penalties are the same as for CbCR. 54

56 Vietnam -The Ministry of Finance in Vietnam released a draft decree on Transfer Pricing for public consultation, which would introduce country-by-country reporting, Master file, and Local file. 55

57 Countries anticipating implementation of BEPS Action 13 56

58 Bermuda Costa Rica Curacao Georgia Greece Guernsey Hong Kong Indonesia Isle of Man Kenya Latvia Liechtenstein -Ministry of Finance announced intention to adopt CbCR. -Bermuda has signed the MCAA for the automatic exchange of CbCR. -Regulations are expected to be forthcoming. - Adoption of CbCR is anticipated and the regulations for filling CbCR following Action 13 recommendations are expected to be enacted before April Adoption of BEPS Action 13 is anticipated. -Adoption of BEPS Action 13 is anticipated. - Adoption of BEPS Action 13 is anticipated. -Adoption of BEPS Action 13 is anticipated. - Adoption of BEPS Action 13 is anticipated. - The Hong Kong Government launched a public consultation exercise on 26 October 2016 to gauge views on the implementation of the OECD s BEPS initiatives, including Action 13. -Further guidance was published on 23 December Directorate General of Taxation informally announced the intention to implement the recommendations of Action 13. -OECD Action 13 recommendations are anticipated. No public information is currently available. -Adoption of BEPS Action 13 is anticipated in Adoption of BEPS Action 13 is anticipated. -CbCR would apply to MNE groups if consolidated revenue exceeds CHF 900 million. 57

59 Namibia New Zealand Nigeria Panama Romania Taiwan Uganda - Action 13 adoption is anticipated. -by- Reporting -New Zealand Inland Revenue are not expected to make legislative changes necessary to implement CbCR. Instead they are leveraging their current powers under the NZ Tax Act to directly request CbC reports from NZowned groups which meet the OECD's CbC reporting threshold (MNEs with annual consolidated group revenue equal to or exceeding 750 million). -The informal adoption of CbC makes the filing requirements apply for fiscal years beginning on or after 1 January Filing deadline currently believed to be no later than 12 months after the last day of the reporting fiscal year of the MNE group. -Adoption of OECD's XML Schema standardized electronic format is anticipated. -No current requirement to notify New Zealand Inland Revenue regarding global group CbC obligations unless specifically requested to do so. Master File and Local File -MF and LF structure will be expected in practice, however legislation is considered unlikely at this stage. MF and LF may not be applicable for smaller MNEs. -It is expected that a bill to transpose CbCR into Nigerian law will be presented to the National Assembly soon. -Adoption of CbCR is anticipated. -by-country Reporting -Adoption of CbCR is anticipated. Master File -No separate document called 'Master File' is required, but some of the Action13 Master File (MF) content is required in the transfer pricing documentation. - Draft Guidelines to CbCR are anticipated to be released at the end of December 2016, and are anticipated to be generally similar to the OECD Guidelines. - Adoption of BEPS Action 13 is anticipated. 58

60 Countries that signed the MCAA on CbCR 59

61 Countries that signed the MCAA on CbCR Most of the signatories to the Common Reporting Standard Multilateral Competent Authority Agreement (MCAA) have adopted or indicated an intent to adopt CbCR, but some signatories have not. However, we believe signing the MCAA indicates a general intent to adopt CbCR. Argentina Estonia Japan Poland Australia Finland Jersey Portugal Austria France Korea Senegal Belgium Germany Latvia Slovak Republic Bermuda Georgia Liechtenstein Slovenia Brazil Greece Luxembourg South Africa Canada Guernsey Malaysia Spain Chile Iceland Mexico Sweden Costa Rica India Netherlands Switzerland Curacao Ireland New Zealand United Kingdom Cyprus Isle of Man Nigeria Uruguay Czech Republic Israel Norway Denmark Italy People s Republic of China Last updated: December 7, 2016 Total 50 countries 60 Source: OECD,

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