Country-by-Country Reporting (CbC)

​Interpretation

The Jersey authorities will interpret the Country-by-Country Reporting Regulations in a manner that is consist​ent with the Organisation for Economic Co-operation and Development's (OECD) Guidance on the implementation of country-by-country reporting, as it may be amended from time to time.

You should be aware of the following:

1. for the purposes of clarit​y, the interpretation of terms in the Regulations, the OCED Multilateral Competent Authority Agreement on CbC and all bilateral agreements between Jersey and other jurisdictions regarding exchange of CBC reports shall be consistent with guidance published by the OECD on the implementation of CbC report under Base Erosopn and Profit Shifting (BEPS) Action 13. This includes, for instance, clarification on the definition of Related Parties that shall be in accordance with guidance published in April 2017, which confirms a related party (to be included in the third column of table 1 of the model template for CbC Report), which are defined as 'associated enterprises' in the BEPS Action 12 report, are interpreted as the Constituent Entities (CE) listed in table 2 of the model template of the CbC Report
2. the definition of a Multinational Enterprise (MNE) Group contained in the Regulations will be applied in a manner consistent with the OECD guidance on currency fluctuations in respect of an MNE Group whose Ultimate Parent Entity is in a jurisdiction other than Jersey. For further guidance on this matter see Question IV. 1. Impact of currency fluctuations on the agreed EUR 750 million threshold (June 2016) of the guidance on the implementation of country-by-country reporting
3. The Comptroller will assess whether exchange relationships are operating effectively for the purposes of Regulations 5 and 6 in line with the references to 'systemic failure' in the Multilateral Competent Authority Agreement (MCAA) and OECD’s guidance
4. The Comptroller interprets Regulation 6(b) so that this condition is met where an agreement to automatically exchange tax information is in place between Jersey and the jurisdiction in which the ultimate parent entity is resident for tax purposes, but where no competent authority agreement or equivalent is in place regarding the exchange of Country-by-Country Reports between the two jurisdictions for the financial period in question. For this purpose, an 'agreement to automatically exchange tax information' includes bilateral or multilateral exchange agreements providing for automatic exchange of information. For the avoidance of doubt, this test is not met where there is no exchange of information agreement in place between Jersey and the other jurisdiction
   

Country-by-country reporting for tax purposes on OECD

​BEPS Action 13 minimum standard

BEPS Action 13 minimum standard forms part of the OECD and G20 Base Erosion and Profit Shifting (BEPS) project, establishing​ a global standard for transfer pricing documentation and Country-by-Country Reporting (CbCR).

Its main goal is to improve transparency for tax authorities by requiring large MNEs to report key financial data, such as revenues, profits, taxes paid, and economic activity, on a country-by-country basis. This helps tax administrations assess transfer pricing risks and detect profit shifting to low-tax jurisdictions.

The Action 13 standard includes a three-tiered documentation approach:

• a Master File (providing an overview of the MNE group)
• a Local File (detailing transactions in each jurisdiction)
• the CbC Report (summarizing global allocation of income and taxes)
  

It is a minimum standard, meaning all members of the OECD Inclusive Framework are required to implement it and undergo annual peer reviews to ensure consistency, confidentiality, and appropriate use of the data. 

​ Guidance on the implementation of country-by-country reporting: BEPS Action 13 on OECD

​Definitions

Country-by-Country Report (CbCR)

A standardised template that Multinational Enterprises (MNEs) must file, showing financial data, such as revenue, profit, taxes paid and number of employees, for each country where they operate.

Constituent Entity (CE)

Any separate business unit within an MNE group, such as subsidiaries and branches, that is included in the CbC Report.

​Ultimate Parent Entity (UPE)

The top-level company in an MNE group that is required to file the CbC Report if its consolidated group revenue exceeds the threshold (usually €750 million).

​​Related Party

Entities within the same MNE group that engage in transactions with each other. These are also referred to as 'associated enterprises' in OECD guidance.

Systemic Failure

A situation where a jurisdiction fails to exchange CbC Reports as required, or fails to notify other jurisdictions of such failure, affecting the reliability of automatic exchange agreements.

​Multilateral Competent Authority Agreement (MCAA)

An international framework that allows jurisdictions to automatically exchange CbC Reports securely and consistently.

​Guidance

There is no obligation to file a Jersey CBC report if any of the following apply:

• The ultimate parent entity of the Jersey entity is resident in a jurisdiction which requires it to file a CBC report, and there is an agreement in force that permits that jurisdiction to provide details of the Jersey entity to the Comptroller of Revenue
• Its details will be included in a report filed by another Jersey group member, or its details will be included in a CBC report filed in another jurisdiction by another group member, and there is an agreement in force that permits that jurisdiction to provide details of the Jersey entity to the Comptroller of Revenue 

In all cases, the Jersey entity must notify the Comptroller of Revenue of the name of the group entity which will be reporting its details and must do so by the end of the accounting period in respect of which the report must be filed.

Country-by-country reporting: Handbook on effective implementatioon OECD

Guidance on the appropriate use of information contained in CbC reports on OECD

Signed CbC Competent Authority agreements with other jurisdictions

Jersey US agreement on the exchange of Country-by-Country Reports

Jersey UK agreement on the exchange of Country-by-Country Reports

Jersey Guernsey agreement on the automatic exchange of financial account information

Jersey Hong Kong China MOU in force 31 December 2018

​Where no agreement is in place

In accordance with Regulation 5, where no CbC Competent Authority Agreement is in place, local filing ​of CbC reports will be required by any Jersey member of a multinational group of companies whose annual profits exceed €750 million.

If a jurisdiction does not have a Country-by-country Competent Authority Agreement in place with Jersey, then Jersey entity must either file its CbC report directly in Jersey by the deadline or choose a surrogate parent in another country that does have a CbC agreement with Jersey.

Text of the CbC Multilateral Competent Authority agreement on OECD

Signatories of the Multilateral Competent Authority agreement on the exchange of country-by-country reports on OECD

​CbC registrations

Entities intending to submit CbC notifications will need to apply for a CbC registration through the Jersey AEOI portal.

Log in Jersey AEOI portal

Once you have completed your application to register, if approved, you will receive an email notification providing you with a User ID and activation pin. The first time you log in you will be prompted to set your password. 

Only one registration is required per MNE Group. When you complete the registration form in the section that asks for contact information of the Jersey Entity, use the details of the main entity in Jersey. 

Once the registration is complete, you can add the details of any other Jersey entity in the CbC notification tab. Please note you can only submit CbC notifications once you have activated your CbC account. 

If you already have an account on the AEOI portal that was used for FATCA, CRS, or CARF you will not be permitted to use this account for CbC purposes and you will be required to complete a separate application. FATCA, CRS and CARF data is held separately to CbC data and anyone who is only registered to your CbC account cannot access your FATCA, CRS or CARF report history or any data.

​​XML schema

All CbC reports must be submitted using the CBC reporting XML schema developed by the OECD. Guidance on the use of the schema can be obtained from the OECD website. 

Country-by-country reporting status message XML schema: User guide for tax administrations, version 2.0: June 2019 on OECD

A test portal site is available on the Jersey AEOI portal to validate anonymised dummy reports before submitting completed reports through the live portal.  

To use the test portal, you must register separately from the live portal.

Live client data must not be subm​itted to the test portal.

Jersey AEOI test portal

​CbCR common errors

Jersey has a robust validation process to ensure that errors within CbC reports are identified prior to onward exchange. The reporting Muti-National Entities (MNEs) are required to correct any errors identified within the report. Below is a list of common errors made by MNE groups when submitting reports. It is essential that reporting MNEs are aware of these errors to ensure a smooth exchange. 

Common errors made by MNEs when preparing Country-by-Country reports on OECD

​Questions and additional guidance

If you have any questions or require additional support or guidance, call​ the AEOI Team on + 44 (1534) 440605 or email AEOI@gov.je.