Considerations on COM(2024)497 - Amendment of Directive 2011/16/EU on administrative cooperation in the field of taxation

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dossier COM(2024)497 - Amendment of Directive 2011/16/EU on administrative cooperation in the field of taxation.
document COM(2024)497 EN
date April 14, 2025
 
table>(1)Council Directive (EU) 2022/2523 (3) implements the agreement reached on 8 October 2021 by the OECD/G20 Inclusive Framework (‘OECD/G20 IF’) on base erosion and profit shifting (‘BEPS’) and closely follows the Global Anti-Base Erosion Model Rules (Pillar Two) of Organisation for Economic Co-operation and Development (OECD) (‘OECD Model Rules’) agreed by the OECD/G20 IF on 14 December 2021. Directive (EU) 2022/2523 introduces a qualified income inclusion rule (‘IIR’) and a qualified undertaxed profit rule (‘UTPR’). That Directive also allows Member States to introduce their own qualified domestic top-up tax (‘QDTT’).
(2)Directive (EU) 2022/2523 already establishes the rules for filing Top-up tax information returns and outlines broadly the information categories to be reported by the multinational enterprise (‘MNE’) groups and large-scale domestic groups covered by that Directive. The tax administrations need those Top-up tax information returns to perform an appropriate risk assessment, to evaluate the correctness of the tax liability and to monitor whether MNE groups and large-scale domestic groups apply the rules established in Directive (EU) 2022/2523 correctly.

(3)It is therefore appropriate to amend Council Directive 2011/16/EU (4) to establish new rules on the automatic exchange of information to facilitate the exchange of information with respect to the Top-up tax information return and thereby establish the framework for the operational implementation of the filing obligations laid down in Directive (EU) 2022/2523, in line with the OECD/G20 IF Multilateral Competent Authority Agreement on the Exchange of GloBE Information and its commentary and the GloBE Information Return (‘GIR’) to the extent that such new rules are consistent with the filing obligations laid down in Directive (EU) 2022/2523 and with Union law.

(4)While the general rule is that a constituent entity files a Top-up tax information return with its tax administration (‘local filing’), Directive (EU) 2022/2523 provides a derogation pursuant to which a constituent entity is not obliged to file a Top-up tax information return with its tax administration if a Top-up tax information return has been filed by the ultimate parent entity or by a designated filing entity located in a jurisdiction that has, for the Reporting fiscal year, a qualifying competent authority agreement in effect with the Member State in which the constituent entity is located (‘central filing’). This Directive constitutes such a qualifying competent authority agreement between Member States.

(5)The new rules on automatic exchange of information should enable the central filing of the Top-up tax information return in accordance with Directive (EU) 2022/2523, and may also serve for filing purposes in each jurisdiction that is implementing the OECD Model Rules (‘implementing jurisdiction’) (5). Tax administrations of each relevant Member State should receive the necessary information under the standardised information return.

(6)Member States should take the necessary measures to require the filing constituent entities of MNE groups to use the standard template set out in Directive 2011/16/EU to fulfil their filing obligations under Directive (EU) 2022/2523. The Member States have discretion regarding which template is to be used by large-scale domestic groups to fulfil their filing obligations laid down in Directive (EU) 2022/2523, except in the limited situations when there is a need for exchange of information.

(7)When a Member State receives a Top-up tax information return from the ultimate parent entity or the designated filing entity of an MNE group under central filing in accordance with Directive (EU) 2022/2523, that Member State should communicate to other Implementing Member States or QDTT-only Member States, no later than 3 months after the filing deadline, or – in the case of receipt of a Top-up tax information return after the filing deadline – no later than 3 months after such receipt, the relevant specific parts of the Top-up tax information return in accordance with the dissemination approach approved by the OECD/G20 IF. As regards the first Reporting fiscal year, the deadline for communication of those relevant specific parts of the Top-up tax information return should be prolonged to 6 months after the filing deadline. Additionally, in order to accommodate any delays in the new system of exchange, in any case (i.e. for the first and next Reporting fiscal years) the first exchange will take place no earlier than 1 December 2026.

(8)The Member State of the ultimate parent entity of the MNE group should receive the full Top-up tax information return. The Implementing Member State should be provided with the General section of the Top-up tax information return, provided that there is a constituent entity of the MNE group located in its territory. The QDTT-only Member State, where constituent entities of the MNE group are located, should be provided with the relevant parts of the General section of the Top-up tax information return, although QDTT-only Member States should not send any information in respect of the Top-up tax information return by automatic exchange of information.

(9)Jurisdictional sections should be provided to the Member State with taxing rights under Directive (EU) 2022/2523, including the QDTT, in accordance with the dissemination approach.

(10)Directive (EU) 2022/2523 allows Member States in which no more than twelve ultimate parent entities of groups within the scope of that Directive are located, to elect not to apply the IIR and UTPR for a limited period of time. In such cases, a Member State, if it is not a QDTT-only Member State, should only start applying the rules on exchange of Top-up tax information returns (i.e. receive and send the information) when the election period under Directive (EU) 2022/2523 ends.

(11)In order to ensure uniform conditions for the implementation of this Directive and in particular, for the automatic exchange of information between competent authorities, implementing powers should be conferred on the Commission to adopt the necessary practical arrangements, as part of the procedure for establishing the standard computerised form. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (6).

(12)The receiving competent authority should notify the sending competent authority when there is reason to believe that the information included in a Top-up tax information return, being subject of the exchange, requires correction. Since such notification normally takes place before a more thorough risk assessment or tax examination, the sending competent authority should be notified only of manifest errors identified. The corrected information should be exchanged without undue delay with all competent authorities for which that information is subject to exchange in accordance with this Directive. This procedure does not preclude tax administrations from requesting necessary corrections in follow-up requests to verify compliance with Directive (EU) 2022/2523 under their national law.

(13)If a competent authority does not receive an exchange that was expected pursuant to a notification from an MNE group, it should notify the competent authority that was expected to send the information of the missing exchange. The competent authority that was expected to send the information should without undue delay determine the reason for not exchanging the relevant information and inform the competent authority that notified the missing exchange of that reason within 1 month, indicating, where relevant, the expected new date for the exchange. In order to ensure the effective operation of Directive 2011/16/EU, it is understood that the exchange should take place as soon as possible to avoid causing additional delays for Member States. The expected exchange date should be set for a date no later than 3 months from the date of the receipt of notification of the missing exchange.

(14)If the Top-up tax information return has not been filed centrally by the ultimate parent entity or the designated filing entity of an MNE group and the information is not received by the new expected date for exchange, it is understood that the competent authority that notified the missing exchange may require local filing since the conditions for central filing under Directive (EU) 2022/2523 have not been fulfilled.

(15)Directive 2011/16/EU, including Annex VII thereto, as amended by this Directive, should be read together with Directive (EU) 2022/2523. The terms set out for the purposes of exchange of information with respect to the Top-up tax information return under this Directive should have the same meaning as those in Directive (EU) 2022/2523. Furthermore, this Directive contains additional definitions that are necessary to reflect international developments made in the context of the exchange of information in the field of taxation.

(16)In implementing this Directive, Member States should use the Multilateral Competent Authority Agreement on the Exchange of GloBE Information and its commentary, the OECD Model Rules and the explanations and examples in the Commentary to the Global Anti-Base Erosion Model Rules (Pillar Two) released by the OECD/G20 IF on BEPS, as well as the GloBE Implementation Framework, and any updates thereto, as a source of illustration or interpretation in order to ensure consistency in application across Member States to the extent that those sources are consistent with this Directive, Directive (EU) 2022/2523 and Union law. Consequently, the OECD/G20 IF on BEPS instructions for the filing of the standard template, such as the introduction and explanatory guidance to the GIR, including the basis for information reported in the GIR and transitional simplified jurisdictional reporting framework (for fiscal years beginning on or before 31 December 2028, but not including a fiscal year that ends after 30 June 2030), should, to the extent that those sources are consistent with this Directive and Union law, be used as a source of illustration and interpretation for the MNE groups to file the Top-up tax information return in order to ensure consistency of application. It is therefore appropriate to supplement Directive 2011/16/EU with an additional annex that contains a standard template, in line with the standard template developed by the OECD/G20 IF on BEPS, for the filing of the Top-up tax information return under Directive (EU) 2022/2523, as provided for by this Directive.

(17)The standard template for the Top-up tax information return set out in this Directive ensures that the information and tax calculations that an MNE group is required to file under the Top-up tax information return are sufficiently comprehensive to allow tax administrations to perform an appropriate risk assessment and to evaluate the correctness of a constituent entity’s tax liability under Directive (EU) 2022/2523. At the same time, it is sought to avoid imposing unnecessary information collection, computation and reporting requirements on MNE groups and to avoid exposing taxpayers to multiple, uncoordinated requests for further information in each implementing jurisdiction. A standardised Top-up tax information return does not affect the ability of a tax administration to require a routine domestic tax return or to collect information for the purposes of the preparation of the domestic top-up tax return, therefore Member States, in some cases, should be able to require additional data points to be reported beyond the Top-up tax information return for purposes of the preparation of the tax return (for example, to convert the top-up tax liability into the domestic currency). However, the Member States should generally refrain from requiring the reporting of additional data points beyond the Top-up tax information return as part of their routine domestic tax return and payment requirements and any such information should relate, for example, to liability, timing and method of payment or identification of the taxpayer and contact details, rather than the calculation of a constituent entity’s top-up tax liability. This Directive does not apply to domestic tax audit procedures and does not preclude tax administrations from requesting necessary supporting information in follow-up requests to verify compliance with provisions transposing Directive (EU) 2022/2523 under their national law.

(18)To ensure the exchange of information regarding joint ventures and equal treatment, in rare cases where a parent entity of a large-scale domestic group holds a direct or indirect ownership interest in a joint venture or joint venture affiliate and that joint venture or joint venture affiliate is subject to a QDTT in another Member State, Member States should require that such a large-scale domestic group use the same standard template as an MNE group, i.e. standard template for the Top-up tax information return set out in this Directive, when filing their Top-up tax information return. Consequently, Member States should ensure that the provisions on exchange of information are applied in such cases.

(19)Furthermore, recognising the need to provide a complete legal framework, so that it covers the amendments introduced into Directive 2011/16/EU by Council Directive (EU) 2023/2226 (7) as regards the mandatory automatic exchange of information on financial accounts, it is essential to amend Article 8(3a) of Directive 2011/16/EU accordingly. The scope of information to be exchanged should take into account the transitional measures set out in Section XI of Annex I to Directive 2011/16/EU.

(20)Since the objective of this Directive, namely to provide the framework for the operational implementation of the filing obligations laid down in Directive (EU) 2022/2523 on the basis of the common approach contained in the OECD Model Rules and to ensure that respective information on financial accounts is subject to a mandatory automatic exchange, cannot be sufficiently achieved by the Member States, because independent action by Member States would risk fragmenting the internal market, but can rather, given the scale of the global minimum tax reform and the critical importance of adopting solutions that function for the internal market as a whole, 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.

(21)Given that Member States need to act within a very short period of time to begin transposition of rules on the Top-up tax information return, this Directive should enter into force as a matter of urgency.

(22)Directive 2011/16/EU should therefore be amended accordingly,