On January 26, 2017, Russia’s Federal Tax Service (FTS) signed the Multilateral Competent Authority Agreement (MCAA) relative to exchanging country-by-country reporting regarding members of major international groups of companies, according to an FTS press release.

The agreement was made during a Paris session of the inclusive framework group on Base Erosion and Profit Shifting (BEPS), the action plan for which has been approved by the G20 group leaders.

The reports to be shared are documents showing the fiscal parameters, tax data, as well as other operational statistics for companies that have their presence in more than one nation.

The MCAA contemplates disclosure of report data relative to the largest trans-border conglomerates with consolidated annual receipts in excess of EUR750 million (about RUB50 billion). The agreement includes a requirement for a given group’s parent company to submit a comprehensive report to the taxing agency of the state where it principally does business. The MCAA mandates the taxing agency to share the company reports it collects with taxation authorities from other member-countries where group entities do business.

Over 50 states enacted legal measures to allow for exchanging in-country reports within the MCAA framework.

Russia joined the Convention on Mutual Administrative Assistance in Tax Matters on July 1, 2015, which has enabled the FTS to utilize foreign data in conducting tax audits. Russia entered into the MCAA providing for automatically exchanging information on groups of companies in May 2016 at a forum hosted by the Organization for Economic Cooperation and Development (OECD) in Beijing. Initial exchanges of group reports are expected in 2018 and will cover 2017 fiscal results, said OECD Secretary General Angel Gurria. A system of electronic exchanges within the OECD framework is going to be set up to realize the MCAA’s goals efficiently. The information to be shared includes the total income figure, account balances, as well as debits. Member-countries can request the sharing of the same information at the present time on a case-by-case basis.