4. This annual report contains the findings of the second annual peer review process (“phase two”), undertaken by an Ad Hoc Joint Working Party 6 / Working Party 10 sub-group referred to as the “CbC Reporting Group”, which focuses on each jurisdiction’s domestic legal and administrative framework, its exchange of information network, and its measures to ensure the appropriate use of CbC reports.
5. The structure of each individual section relating to a reviewed jurisdiction is as follows:
6. Jurisdictions which have joined the Inclusive Framework after 1 October 2018 have not been reviewed as part of this second annual peer review process. These jurisdictions will be included in the next annual peer review process starting in 2019.
7. This peer review evaluates an Inclusive Framework member’s implementation of the Action 13 minimum standard against an agreed set of criteria.1 These criteria are set out in terms of reference, which include each of the elements that a jurisdiction needs to demonstrate it has fulfilled in order to show proper implementation of the standard. These terms of reference are supplemented by additional questions concerning measures implemented by a jurisdiction to ensure the appropriate use of CbC reporting information. The Action 13 Report recommended that the first CbC reports be required to be filed for fiscal years beginning on or after 1 January 2016. It was however acknowledged that some jurisdictions may need time to follow their particular domestic legislative process in order to make necessary adjustments to the law. In this respect, the peer review takes account of the specific timeline followed by certain jurisdictions, and the review will focus on the efforts taken by these jurisdictions in order to meet their commitment to implement the minimum standard.
8. The manner in which the peer review is undertaken is set out in an agreed methodology. The methodology sets out the procedural mechanisms by which jurisdictions will complete the peer review, including the process for collecting the relevant data, the preparation and approval of reports, the outputs of the review and the follow up process.
9. The methodology recognises that the three key aspects of CbC reporting will be implemented and become operational over the coming years, starting with the domestic legal and administrative framework being put in place generally from 2016, followed by the international exchanges of CbC reports to occur for the first time by mid-2018, and the work to ensure that CbC reports are kept confidential and used appropriately in any subsequent tax compliance actions.
10. Given the fact not all of these three key aspects are being implemented at the same time, these three key aspects will be reviewed according to a staged approach. A staged review enables the review of aspects of CbC reporting to occur as they are implemented, starting in 2017 and allowing for the early detection of inconsistencies in implementing the minimum standard as well as providing an opportunity for early remedial action to be taken by jurisdictions, if necessary.
11. There are three phases for the peer review structured into annual reviews, starting respectively in 2017, 2018 and 2019. Each phase will focus on different key aspects of jurisdictions’ implementation so as to mirror the staged introduction of the different elements that make up the CbC reporting and exchange of information framework.
12. An annual review process allows the CbC Reporting Group to report each year to the Inclusive Framework, taking into account any updates since the previous review, as well as any follow-up actions by reviewed jurisdictions to address any recommendations made by the Inclusive Framework.
13. The Global Forum has conducted preliminary expert assessments of confidentiality and data safeguards with respect to the standard on automatic exchange of information. Given its expertise in this area, the CbC Reporting Group has relied on the work and conclusions of the Global Forum. As it contains non-public information on jurisdictions’ internal systems and procedures, the outcomes of that work are not published and no further details of the review of confidentiality are provided in this compilation of peer review reports.
14. The terms of reference and methodology do not alter the Action 13 minimum standard. Any terms used in the terms of reference or methodology take their meaning from the language and context of the 2015 Action 13 Report and the references therein. Capitalised terms in this report take their meaning from the language and context of the 2015 Action 13 Report and the references therein.
15. The jurisdictions’ individual sections in this report generally reflect the status of implementation as of 31 March 2019, with the exception of information on the number of activated relationships for the exchange of CbC reports which reflects the position as of 31 May 2019.
