A new requirement is rapidly changing the landscape: Public Country-by-Country Reporting (CbCR). This new layer of transparency, primarily driven by the European Union, shifts the CbCR from being a confidential exchange between governments to a public disclosure available to everyone—journalists, competitors, NGOs, investors, and the general public.
This is a paradigm shift. If your confidential CbCR was about compliance, the Public CbCR is about reputation and narrative control.
Author: Ernst, transfer pricing advisor
1. What is Public CbCR and why was it introduced?
Public Country-by-Country Reporting is the mandatory public disclosure of corporate income tax information for large multinational enterprises (MNEs).
- Goal: Public CbCR aims to increase corporate transparency and foster public trust. Regulators want to enable stakeholders to assess whether MNEs are paying their fair share of tax where they conduct their economic activity, putting public pressure on potential aggressive tax planning.
- Driver: In the EU, the requirement is mandated by the Public CbCR Directive (Directive 2021/2101).
2. Who is in scope and when does it apply?
The rules apply to MNE groups that exceed the same high threshold as the confidential CbCR, but the scope of entities is broader due to the EU presence requirement:
- Revenue threshold: Consolidated group revenue exceeding €750 million in each of the last two consecutive financial years.
- In-Scope entities (EU nexus):
- MNEs headquartered in the EU that meet the threshold.
- Non-EU headquartered MNEs that meet the threshold and have a medium-sized or large subsidiary or a qualifying branch established in an EU Member State.
- Effective date: For most EU Member States, the rules apply to financial years starting on or after June 22, 2024. For calendar-year companies, the first report will generally cover the 2025 financial year, with the deadline for publication being December 31, 2026.
3. What needs to be published?
The report is fundamentally based on the same data points as the confidential CbCR, but the aggregation and disclosure requirements differ significantly:
| Category | Information required |
| Identification | Name of the Ultimate Parent Entity (UPE) |
| Identification | Covered financial year |
| Identification | Currency used |
| Activity Data | Nature of the activities |
| Activity Data | Number of employees (Full-Time Equivalent – FTE) |
| Geographic Scope | List of subsidiaries located in the EU (and EEA) or the EU list of non-cooperative jurisdictions for tax purposes |
| Financial Data | Revenues (Total Net Turnover) |
| Financial Data | Profit or loss before tax |
| Tax Data | Income tax accrued (current year’s tax charge) |
| Tax Data | Income tax paid (cash basis) |
| Earnings | Accumulated earnings at year-end |
Reporting breakdowns:
- EU and blacklist/greylist jurisdictions: Data must be disclosed separately for each of the 27 EU Member States and for every jurisdiction on the EU’s list of non-cooperative tax jurisdictions (the ‘blacklist’ and ‘greylist’).
- Rest of the world: For all other jurisdictions outside the EU/EEA and the black/greylist, the data can be aggregated under a single heading (“Rest of the World”).
4. Where and for how long must the report be accessible?
Transparency means accessibility. MNEs must ensure the report is publicly available in a machine-readable electronic format:
- Public registry: Filed with the public registry (e.g., the local Chamber of Commerce) of the relevant EU Member State.
- Company website: Published free of charge on the company’s own website.
- Duration: The report must remain publicly accessible on the company’s website for a minimum of five consecutive years.
5. The reputational risk: why narrative control is essential
The biggest risk of Public CbCR is not the tax authority; it’s the misinterpretation of your data by the public.
Non-tax experts (journalists, activists, shareholders) often simplify tax analysis to a basic ratio: Taxes Paid / Profits Earned. If a jurisdiction shows high profit but low tax paid (even if fully justified by local tax incentives or timing differences), it can lead to immediate and severe reputational damage.
Action point: You must develop an explanatory narrative that proactively tells your story and contextualizes any apparent “outliers.” This narrative should align with your overall corporate strategy and ESG (Environmental, Social, and Governance) commitments, transforming the compliance burden into a testament to corporate citizenship.
Strategic compliance
The Public CbCR is far more than a technical filing; it’s a profound strategic communication challenge.
At TransferPricingMadeEasy, we help you navigate this visibility. We use our sharp insight to analyze your data before it goes public, proactively identifying and framing potential red flags to ensure your public disclosure tells a stylish, transparent, and defensible story.
Ready to control your narrative in the age of tax transparency?
Let’s discuss how your Public CbCR can become an asset.