EUROPE-WIDE Trends and Developments Contributed by: Munshya Mupela, Semra Altıntaş, Shirley Li and Joyce Lo, TPA Global
EU Public CbCR: transparency for a wider audience EU Public CbCR shifts tax disclosures from confi - dential exchanges between tax authorities to pub - lic accessibility. It applies to large EU-based MNEs as well as non‑EU groups with EU operations. The required disclosures largely mirror the information requested under private CbCR. Public CbCR focuses on information related to EU member states, the EEA, and EU-listed non-cooperative jurisdictions, ensuring this information is made available in a transparent and accessible format. GloBE Information Returns (GIR) and how CbCR connects Pillar Two introduces a new level of tax reporting complexity. Through DAC9, the EU has implement - ed the required GIR reporting under Pillar Two. The GIR requires extensive jurisdiction‑level data, includ - ing GloBE income, adjusted covered taxes and tax adjustments. As a result, it is significantly more tax‑accounting‑intensive than CbCR.Fig 4 outlines the GIR sections and their respective focuses and rela - tionships with CbCR. Conclusion Europe’s tax transparency framework is evolving from high-level CbCR data to sophisticated GloBE disclo - sures. CbCR remains the baseline dataset, Public CbCR enhances visibility, and Pillar Two introduces detailed calculations and reconciliations. Although these regimes differ in purpose, they are anchored in an underlying assumption of the arm’s length prin - ciple. As reporting obligations expand, MNEs must develop well‑governed data architectures that con - nect CbCR information with Pillar Two GIR require - ments. Tax reporting has now entered a new level of complexity, requiring strong data management and co-ordinated processes across the organisation. *** This article was produced with the assistance of AI. All substantive content, analysis and conclusions remain the sole work of the authors.
examined and substantiated – or challenged – through VCA, making the combination of both tools essen - tial for demonstrating transparency, substance and defensible transfer pricing positions. The Expanding Tax Transparency Landscape in Europe: From Private CbCR to Public CbCR and DAC 9 and How the Data Intersects Author: Joyce Lo Introduction International tax has expanded rapidly, and MNEs now face deeper and more numerous reporting expecta - tions than ever before. In Europe, the three-tier OECD BEPS Action 13 framework – Country‑by‑Country Reporting (CbCR), Master File, and Local File – has now been supplemented by EU Public CbCR. And then Pillar Two reporting will begin, which brings with it more detailed data requirements. While differing in scope and purpose, these frameworks are built on an underlying assumption of the arm’s length principle: profits should be allocated and taxed fairly across jurisdictions. As their scope continues to broaden, tax transparency has evolved beyond high-level dis - closures towards detailed and structured datasets to support the assessment of fair taxation across juris - dictions. Private CbCR as the original data backbone Since BEPS Action 13, private CbCR has served as an information exchange mechanism between MNEs and tax administrations. In Europe, this is implemented through Directive (EU) 2016/881 and DAC4. Private CbCR provides tax authorities with a jurisdictional breakdown of revenues, profits, taxes paid, employees and tangible assets – making it the baseline dataset for all subsequent European transparency initiatives. Both EU Public CbCR and the Pillar Two GloBE Infor - mation Return (GIR) – implemented through Directive (EU) 2021/2101 and Directive (EU) 2022/2523 – mirror private CbCR’s structure. Their first reporting deadline falls in 2026, marking a pivotal year in which MNEs must establish robust frameworks to manage and rec - oncile all required data.
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