Why today’s vote on corporate transparency in France matters for the rest of Europe
December 4th, 2015
December 4th, 2015
Just hours ago, tax transparency campaigners received a welcome victory by way of the French National Assembly, which approved a measure supporting public country by country reporting for corporations. Rather than vague bundled reports that are difficult to decipher, a requirement for country by country reporting would make it much easier to know basic information about a company, like where it operates, how much it pays in taxes, and how many employees it has in a given jurisdiction.
While the vote is just the first step in the process, it is an important one, especially in the wake of the OECD-led BEPS process, which shunned the idea of making country by country reports public. The victory is thanks, in no small part, to a number of allies in France and around Europe. Platefomre Paradis Fiscaux et Judiciaires, a network of 19 French civil society organizations, has released a statement following the vote, which you can read (in French) here.
A small excerpt (with the help of Google translate) shows just how important public country by country reporting would be:
This measure, requested for over 10 years by organizations of the Platform Tax Havens and Judicial and its partners, would reveal the artificial tax arrangements and enable all countries, including developing countries, but also to citizens, journalists, parliamentarians, unions, investors and civil society in general whether the taxes paid by the companies correspond to their real economic activity.
The measure will now go to the Senate, and ultimately back to the French National Assembly, before it can become law. But the vote is also an important marker in the sand from a broader EU perspective.
The European Parliament strongly supported public country by country reporting for multinational corporations in a vote this past July, and European Parliament is now in negotiations with the European Commission and European Council to come to an agreement on the measure, which is part of the EU Shareholders Rights Directive.
Today’s vote by French MPs should serve as yet another reminder of the growing support for public reporting. Last year, a Pricewaterhouse Coopers survey showed that 59% of CEOs would support public country by country reporting, and a survey carried out by Christian Aid in September of this year uncovered little fervent opposition to public reporting requirements from FTSE100 companies.
For more of a background on what country by country reporting is, and why it matters, view our page on the subject.