FRANCE LAW AND PRACTICE Contributed by: Caroline Silberztein, Benoît Granel, Jean-Baptiste Tristram, Lionel Ochs and Laura Nguyên-Lapierre, Baker McKenzie
point (i) in connection with transactions men - tioned under point (ii); and • the tax regime applying to the transactions mentioned under point (ii) and carried out by enterprises exploited abroad, or companies or groupings mentioned under point (i) in which it owns, directly or indirectly, the major - ity of the capital or of the voting rights. Country-By-Country Requirements The CbCR requirement (Article 223-quinquies C of the FTC) is largely inspired by the OECD/G20 final Action 13 report, Transfer Pricing Docu- mentation and Country-by-Country Reporting , released in 2015. The scope and application of this requirement are specified in Article 46-quar - ter-0 YE of Annex 3 to the FTC. The French CbCR has to be filed by the following two types of entities. • French parent companies that are within the scope of this requirement (ie, they are legally required to establish consolidated accounts; own or control, directly or indirectly, one or more foreign entities or branches; and realise an annual consolidated revenue of EUR750 million or more) for all the consolidated sub - sidiaries and branches. • French subsidiaries of foreign groups, if the foreign parent company would pass the threshold if it were established in France but is not subject to a similar obligation in its own jurisdiction and/or if the country of the foreign parent company does not have an agreement in force with France allowing the automatic exchange of CbCR with the French authori - ties. In such cases, it is still possible for the French subsidiary to avoid the requirement to file the CbCR, if it can demonstrate that the group’s CbCR has already been filed by another group entity situated either in France or in another country that has an agreement
in force with France allowing the automatic exchange of CbCR with the French authori - ties. Article 46-quarter-0 YE of Annex 3 to the FTC lists the required information to be provided in the CbCR. Public Country-By-Country Requirements France transposed European Directive 2021/2101 on public CbCR, applicable to FYs opened on or after 22 June 2024, requiring cer - tain companies and branches to publicly dis - close certain information (largely aligned with the CbCR) relating to corporate income tax (Ordi - nance 2023-483 of 21 June 2023). 9. Alignment With OECD Transfer Pricing Guidelines 9.1 Alignment and Differences French statutory and administrative approaches to TP are generally consistent with the princi - ples set out by the OECD. Article 57 of the FTC is a similar provision to Article 9 of the OECD Model Tax Convention. The OECD Transfer Pric - ing Guidelines are not directly binding under French law. However, the FTA makes express reference to them. In particular, the five OECD- recognised TP methods (see 3.1 Transfer Pric- ing Methods ) are accepted and used by the FTA. The FTA increasingly refers to the OECD Transfer Pricing Guidelines in its published doc - trine and in tax audits (FTA guidelines: BOI-BIC- BASE-80-10-20). 9.2 Arm’s Length Principle There are no circumstances under which the French regulations contemplate a departure from the arm’s length principle.
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