Public Country-by-Country Reporting: Corporate Law, Fiscal Law and the Principle of Unanimity

The European Union is in the process to establish “public country-by-country reporting” as a new and wide reaching obligation for multinationals to disclose tax-relevant numbers to a global audience, going beyond the OECD consensus which combined cross-border exchange of reports with confidential treatment by tax authorities. From a legal and institutional point of view the main issue is the correct legal basis for the new directive under the European treaties. Is this a matter of accounting law – which would allow legislation by a qualified majority of Member States under Art.50 TFEU – or is this a matter of tax law – which would require unanimity under Art.115 TFEU? The article shows how the treatment of these issues has been driven rather by political than by legal concerns including a deliberate modification of the directive’s preamble in order to secure a majority vote under Art.50 TFEU.