Maya Forstater

Depends on level of penalties. What if they put Sub Ltd into financial difficulties costing jobs? What if they render local directors of Sub Ltd criminal? They'd need to be that kind of level to force extra territorial compliance.

Yeah I wouldn't put it past Vietnam

Suppose parent might argue democratic deficit in that they are not resident but being penalised indirectly. (Who wants to mention FATCA...) Or could play hardball, threaten to move investment elsewhere?

Woah, how did I get pulled into this? I agree w/what's been said before, I think the local country can just require it and punish the sub if the parent doesn't supply the info. Not all that different from other doc requirements. (E.g. transfer pricing.)

Also remember, if it's following the OECD guidelines to the letter, the local jurisdiction can only request the CBCR if the parent country refuses to participate in the system and the company refuses to set up a surrogate parent.

Vietnam's approach is that they require (at least so the decree says) all subs whose parents file cbcr elsewhere to also file it in Vietnam. (i.e. tearing up the OECD guidelines). The case study says this is a great idea. But i wonder how it is actually working....

Thought a consensus was developing that it might work if companies agreed but it breached the international agreements. Unless we discover names of complying firms we can't really hazard a guess on why.

As far as I know there's no int'l agreement that would prevent Vietnam from requiring the reports, it's all just the OECD soft law. Maybe it would come up in a double tax dispute but even that's a bit of a stretch.