Country-by-Country Reporting (CBCR) - What's up in Switzerland

In October 2015 the OECD published as part of the Base Erosion and Profit Shifting Project (“BEPS”) recommendations on Country-by-Country Reporting (“CbCR”). On April 13th 2016, the Swiss Federal Council released the draft federal act on CbCR for consultation. The draft law follows the OECD recommendations on CbCR. The planned effective date of the new legislation should be January 1st 2018. The first CbC Reports exchanges will occur in 2020. Earlier exchange could happen on a voluntary basis.


According to the OECD CbCR recommendations the reporting applies to multinational entities (“MNE”) with annual consolidated group revenues equal or superior to EUR 750m. In summary the following scope and methods apply

  • the ultimate parent will have to file the CbCR in most cases
  • this requirement will apply starting with the tax years open on or after Jan 1, 2016
  • the CbCR will have to be filed within the 12 months following the end of the tax year
  • the lack of filing of the CbCR will be subjected to a fine in most countries
  • starting in 2018, the CbCR will be exchanged between tax authorities
  • the CbCR provides for the breakdown by country of the taxable profit, the corporate income tax (CIT) and the    substance.

CbCR introduction into local legislations is progressing fast. By April 2016 approx. 20 countries had
either enacted or published draft acts on the CbCR:

  • Countries that have enacted CbCR:  Denmark, France, Italy, Ireland, the Netherlands, Portugal, Poland, Spain, UK,  Australia, Japan and Mexico
  • Issued draft legislation: Germany, China, the US, India and some others

In April 2016 the EU Commission proposed legislation discussing the general publication of CbC Reports for
MNE ‘s within the EU. Although Switzerland is not part of the EU, the EU Commission proposal could also affect Swiss based MNE’s. For MNE’s with headquarters outside the EU, its EU based medium and large-sized subsidiaries/branches would need to file a CbC Report for the MNE Group unless the non-EU parent makes the relevant information publically available.


On April 13th 2016 the Federal Council started the consultation phase of the Swiss Federal Act on the International Automatic Exchange of Country-by-Country Reports of Multinationals (“CbCR law”) among political parties, interest
associations and Swiss cantons. All relevant stakeholders in the political process can provide comments until July 13th 2016. After this date the final draft law will be released for discussion in the Swiss parliament. Following parliamentary approval, the new Federal Act may be subject to a referendum and public vote.
The proposed Federal Act closely follows the recommendations made by the OECD and  covers the following:

  • The obligation to submit an annual CbC Report would apply to MNE’s with a Swiss resident parent-entity (“Swiss MNE”) with annual consolidated group revenues equal or superior to CHF 900m.
  • The planned effective date of the new legislation should be January 1st 2018. Swiss MNE’s would need to submit CbC Report to the Federal Tax Administration (“FTA”) within 12 months of the group’s financial year-end. The CbC Report for 2018 must be submitted to the FTA by December 31, 2019 at the latest. Swiss CbC Report shall be exchanged starting in the first half of 2020.
  • Some countries such as France, Italy, the Netherlands or Australia and Canada which  have already enacted CbCR legislation will request CbR reports from local subsidiaries of Swiss MNE’s with 2016 and 2017 financial information.  Therefore the draft law provides two options to Swiss MNE’s to provide CbC reports on a voluntary basis. Either a relevant CbR Report is filed with the FTA for exchange with the foreign tax jurisdiction or the Swiss MNE files the CbR Report directly with the foreign tax jurisdiction through its local subsidiary.
  • Failure to provide the CbC Report or provide an incorrect or incomplete CbC Report would trigger a penalty of up to CHF 250’000. In case of non-cooperation with the FTA additional penalties up to CHF 50’0000 could be due during an examination process.

The exact filing method, content and form of the Swiss CbCR is still subject to confirmation. It is however anticipated that Switzerland will follow the OECD guidelines and the recently published user guide for tax administration and taxpayer. Basically the CbCR includes three tables:

  • Table 1 breakdowns the taxable profit, the CIT and substance elements by country.
  • All the subsidiaries of the MNE and their respective activities will be reported in table 2.
  • Table 3 will include pieces of information needed for the good understanding of tables 1 and 2.


In view of the new rules, Swiss MNE’s should start to analyze and collect the relevant information and prepare CbC Reports.

  • Be proactive in 2016 respectively in 2017 and prepare a CbCR on the basis of the 2014 or 2015 consolidated accounts respectively the 2015 and 2016 accounts
  • Be able to take corrective actions, including the reinforcement of the substance where the activities are performed
  • Start compiling all the tax payments (other than the CIT) by country, in order to show the contribution in countries
    where little to no CIT is paid
  • Sort out technical details related to the CbCR preparation

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CBCR - Switzerland
CBCR - Switzerland