Following the call for stakeholder views by the European Commission (EC) concerning financial reporting on a country-to-country basis by Multinational Companies (MNCs), Eurodad and its members submitted their contributions to the EC public consultation process, launched in November 2010. Accordingly, they call upon the EC to implement a required set of standards in terms of country-by-country reporting that can ensure greater financial transparency as well as minimize tax evasion by MNCs.

Currently, there are no international requirements that can oblige MNCs active in the EU to disclose financial information on a country-by-country basis of the consolidated accounts of the parent company. Recently however, there have been calls for greater transparency, not least from the European Parliament. The European Commission is expected to publish a Communication by September 2011, addressing those issues.

Eurodad has emphasised a number of issues, inter alia demanding that country-by-country reporting should be universal in scope and should apply in all countries in which the company operates. However, it should only concern large, extractive corporations, with significant economic impact, as to avoid the imposition of additional reporting burdens to small companies.

Eurodad and its members contend that country-by-country reporting would greatly contribute to a level playing field for European companies as well as make transparency an international norm. In general, they argue that country-by-country reporting would not prove as costly as it appears at a first glance, as MNCs are likely to already have available these data in order to be tax-compliant.

Eurodad Submission letter (doc) and Explanatory note (doc)

Source:

• Eurodad