BEPS – Where we are now

"Bit of Transfer Pricing"

The Organisation for Economic Cooperation and Development (OECD) presented a report to the secretaries of finance of the G20 countries at a meeting in Chengdu, China on 23 – 24 July 2016.

The OECD report provides inter alia an update of the base erosion and profit shifting (BEPS) project as well as tax transparency. In terms of the BEPS status update, there are 85 member countries and 19 countries that “are likely to join” the G20/OECD Inclusive Framework on BEPS by the end of this year. It is also reported that progress towards the implementation of the BEPS package is underway, with over 50 countries having already taken “concrete steps” to implement Country-by-Country Reporting. In this context, the OECD has released further guidance on the implementation of this action point in June supporting the current transitional period as more and more countries ratify these new requirements all over the world.

Simultaneously, the European Union also adopted a Directive implementing OECD anti-BEPS Action 13, on Country-by-Country Reporting, into a legally binding EU instrument. Based on this the EU Member States shall adopt the laws and regulations necessary to comply with the above mentioned Directive until 4 June 2017 which definitely will further increase the number of countries taking actions towards Action 13.

Therefore, considering that the legislative environment is expanding in terms of the BEPS project, multinationals may find the topic more and more crucial to get familiar with to be able to answer to these new challenges in a timely manner.

Based on COUNCIL DIRECTIVE (EU) 2016/881 of 25 May 2016 and the OECD SECRETARY-GENERAL REPORT TO G20 FINANCE MINISTERS, Chengdu People’s Republic of China, 23 - 24 July 2016