Country-by-Country Reporting – Compilation of 2024 Peer Review Reports

First reporting fiscal year: Beginning on or after 1 January 2023

Consolidated group revenue threshold: entity revenues or gross assets of XAF 500 million

Filing deadline: Within 6 months following the filing of the annual income tax return

Local filing required: Yes

Surrogate parent entity filing permitted: No

First review of domestic legal framework: 2023/2024

Congo’s 2019/2020 peer review report included a recommendation to take steps to implement legislation to impose a CbC reporting filing requirement. Congo has since introduced such a filing requirement and this recommendation is removed.1

A CbC reporting filing obligation applies in Congo for fiscal years beginning on or after 1 January 2023 and filing is required within 6 months following the filing of the annual income tax return (10 months and 20 days after the reporting year-end). Congo has enforcement requirements to ensure compliance with rules on CbC reporting.

There are a number of areas where there are recommendations to improve the legislation.

Congo’s legislation specifies a filing threshold of XAF 500 million of local entity revenue or gross assets. The minimum standard requires a filing threshold of EUR 750 million or a near equivalent amount in domestic currency as of January 2015. The filing threshold specified in Congo’s legislation is not consistent with this. It is recommended that Congo take steps to amend the filing threshold or otherwise clarify that it is in line with the standard.

Congo’s legislation does not specify that the threshold requirement refers to MNE Groups’ consolidated group revenue of its immediately preceding fiscal year. It is recommended that Congo takes steps to amend legislation or otherwise clarify that an MNE Group should consider its requirement to file using the consolidated group revenue of its fiscal year immediately preceding a reporting fiscal year for comparison with the threshold.

Congo’s legislation outlines the content of the CbC report but there are several areas in which this does not correspond with the terms of reference. The legislation does not require information on Constituent Entities which do not have a controlled transaction with a Constituent Entity resident in Congo. The legislation also requires the CbC report to include information on the financial years to which retained earnings relate, which is not required under the minimum standard. It is recommended that Congo take steps to amend legislation or otherwise ensure that the content required in the CbC report is in line with the standard.

The information included in the legislation does not include all of the template of the Country-by-Country report and does not include any details of what should be included under each heading in the report. It is recommended that Congo publish the full content and format requirements of the CbC report.

The local filing provision in Congo applies where an MNE Group has a Constituent Entity established in Congo which has revenues or gross assets in excess of the threshold. This is broader than the condition under the standard, where a jurisdiction may require local filing where one or more of the following conditions have been met with respect to that fiscal year: (a) Ultimate Parent Entity of the MNE Group is not obligated to file a Country-by-Country Report in its jurisdiction of tax residence; or (b) the jurisdiction in which the Ultimate Parent Entity is resident for tax purposes has a current International Agreement to which the given jurisdiction is a party but does not have a Qualifying Competent Authority Agreement in effect to which this jurisdiction is a party by the time for filing the Country-by-Country Report; or (c) there has been a Systemic Failure of the jurisdiction of tax residence of the Ultimate Parent Entity that has been notified to the Constituent Entity by its tax administration. It is recommended that Congo take steps to ensure that local filing only occurs in the circumstances permitted under the minimum standard.

Congo has a legislative requirement which is in effect despite Congo not yet meeting all of the consistency, confidentiality and appropriate use conditions. It is therefore recommended that Congo take steps to ensure that local filing only occurs in the circumstances permitted under the minimum standard.

Congo’s legislation does not limit local filing in case of surrogate filing. It is recommended that Congo take steps to amend its legislation or otherwise impose a limitation on local filing in case of surrogate filing in line with the standard.

Where an MNE Group draws up, or would draw up, its Consolidated Financial Statements in a currency other than that specified by a jurisdiction, the reference to the jurisdiction’s threshold has the effect as if it were a reference to the equivalent in that currency at the average exchange rate for the accounting period. While this provision would not create an issue for MNE Groups whose Ultimate Parent Entity is a tax resident in that jurisdiction, it may be incompatible with the guidance on currency fluctuations for MNE Groups whose Ultimate Parent Entity is located in another jurisdiction, if local filing requirements were applied in respect of a Constituent Entity (which is a tax resident of the first jurisdiction) of an MNE Group which does not reach the threshold as determined in the jurisdiction of the Ultimate Parent Entity of such a Group. It is recommended that Congo clarify that the threshold calculation rule applies in line with the OECD guidance on currency fluctuations in respect of an MNE Group whose Ultimate Parent Entity is located in a jurisdiction other than Congo.

It is recommended that Congo implement a provision whereby a single Constituent Entity of the same MNE Group may be designated to file the CbC report which would satisfy the local filing requirement of all the Constituent Entities in Congo.

Congo has no bilateral relationships in place for the exchange of CbC reports nor processes to ensure that the exchange of information is conducted in a manner consistent with the terms of reference relating to the exchange of information framework.

It is recommended that Congo take steps to have qualifying competent authority agreements in effect with jurisdictions of the Inclusive Framework that meet the confidentiality, consistency and appropriate use conditions and with which Congo has an international exchange of information agreement in effect that allows for the automatic exchange of tax information. This recommendation remains in place since the 2019/2020 peer review.

It is recommended that Congo take steps to implement the necessary processes or written procedures to ensure that the exchange of information is conducted in a manner consistent with the terms of reference relating to the exchange of information framework. This recommendation remains in place since the 2019/2020 peer review.

Congo does not yet have controls in place to ensure the appropriate use of CbC reports.

It is recommended that Congo take steps to ensure that the appropriate use condition is met ahead of the first exchanges of information. This recommendation remains in place since the 2019/2020 peer review.