The Organisation for Economic Cooperation and Development (OECD) announced that representatives of the governments of Canada, Iceland, India, Israel, New Zealand, and China signed an agreement for the automatic exchange of country-by-country (CbC) reports, bringing the total number of signatories to 39 countries.
The signing ceremony took place in Beijing, China. The CbC Multilateral Competent Authorities Agreement (MCAA) allows all signatories to bilaterally and automatically exchange Country-by-Country Reports with each other, as contemplated by Action 13 of the BEPS Action Plan. It will help ensure that tax administrations obtain a complete understanding of how large multinational entities - MNEs structure their operations, while also ensuring that the confidentiality of such information is safeguarded.
CbC reporting will require MNEs to provide aggregate information annually, in each jurisdiction where they do business, relating to the global allocation of income and taxes paid, together with other indicators of the location of economic activity within the MNE group. For instance, CbC reporting will cover information about which entities do business in a particular jurisdiction and the business activities of each entity.
