On August 24, 2017, Greece issued Circular 1131 with respect to Law No. 4484-2017 (published in the official gazette on August 1, 2017), which implemented EU Directive 2016/881 (the “Directive”) into Greek legislation regarding the mandatory automatic exchange of country-by-country (CbC) reports. See BEPS Action 13. The Directive amends Directive 2011/16, which was previously amended by 2014/107 and 2015/2376. Directive 2011/16 has been incorporated into Greek legislation by Law 4170/2013. Directives 2014/107 and 2015/2376 have been incorporated into domestic legislation by Law 4378/2016 and Law 4474/2017, respectively.
Law No. 4484-2017 adopts the following provisions of the Directive:
- The ultimate parent entity (UPE) of a multinational group (total consolidated income of at least €750M, or an approximate equivalent amount in local currency in January 2015, in the tax year immediately preceding the reporting tax year) having its tax domicile in Greece, or any other constituent entity, submits the CbC report for the relevant reporting fiscal year within 12 months from the last day of that year.
- The competent authority receiving the CbC report must automatically exchange the report, within the specified time limit, to any member state, in which, on the basis of the report, one or more subsidiaries of the reported entity are either tax domiciled or are subject to tax on business activities carried out through a permanent establishment.
- The CbC report contains the following information about each jurisdiction in which the group operates: (i) aggregate information on the amount of income before tax; income tax paid; income tax payable; share capital; accumulated profits; number of employees; and tangible assets not including cash or cash equivalents and (ii) an identification document for each constituent entity listing the jurisdiction in which it is tax domiciled and, if different, the jurisdiction under which the entity is organized, as well as the nature of its main business activities.
- The CbC report must be exchanged within 15 months of the last day of the group’s reporting tax year. The first report for the tax year starting on or after January 1, 2016 must be exchanged within 18 months of the last day of that tax year.
- A constituent entity resident in Greece, which is not the group’s UPE, submits the CbC report for the group’s reporting tax year if the following criteria are met:
- Entity is a Greek tax resident.
- One of the following conditions applies: (i) UPE is not required to submit the CbC report in its jurisdiction of tax residence; (ii) jurisdiction in which the UPE is domiciled has concluded an international agreement with Greece, but has not entered into any competent authority agreement with Greece by the due date for submission of the CbC report for the reporting tax year; (iii) there has been a systemic failure of the UPE’s jurisdiction of tax residence, and Greece has notified the constituent entity that is tax domiciled in Greece.
On January 27, 2016, Greece was among the 31 countries that signed the OECD Multilateral Competent Authority Agreement for the automatic exchange of CbC reports (the “CbC MCAA”). The CbC MCAA provides that CbC report information will be used to assess high-level transfer pricing and other BEPS-related risks, but not as a substitute for a detailed transfer pricing analysis of individual transactions and prices based on a full functional and comparability analysis.