Exclusion of EU Countries from the List for Exchange of Country-by-Country Reports with Russian Tax Authorities

12.09.2024

Russia will exclude EU countries from the list of countries that will exchange country-by-country (CBC) reports with Russian tax authorities.

In practice, this means that Russian tax authorities are unable to obtain CBC reports officially from abroad because EU counties do not agree to provide these reports.

As a result, subsidiaries of multinational enterprises with a consolidated income of more than EUR 750 million may be requested to file these reports in Russia themselves that we already faced in practice.

This is also applicable with certain limitations to companies in the process of liquidation. This can lead to a postponement of the liquidation and create practical difficulties due to the company's lack of funds at the final stage of liquidation.

If the foreign head office is unwilling to share the full CBC report in Russia, because it contains information on the whole group, the Russian subsidiaries will have to pay a fine of RUB 100,000 (and RUB 1 million for subsequent reporting periods from 01.01.2024).

How we can help

Based on our analysis of the risks and different risk mitigation options, compliance with the CBC reports requirements and preparation of the reports locally appears as the best solution for the operating companies as well as for most companies entering the liquidation process.