Insights

On 12 September 2023, the European Commission published the “Business in Europe: Framework for Income Taxation” (BEFIT) proposal. The BEFIT proposal consists of a new corporate income tax system and new transfer pricing rules. With the new corporate income tax system rules, the European Commission tries to align the corporate income tax bases of multinational groups that operate in the EU. When adopted, BEFIT will replace the current corporate income tax systems of EU Member States for certain EU based entities. In this alert, we will guide you trough the most important topics of BEFIT.

On the 12th of September 2023, the European Commission introduced the BEFIT initiative, also referred to as "the Proposal.". This initiative acknowledges the discretionary interpretations and implementations of the principle-based OECD Transfer Pricing Guidelines by Member States, resulting in tax uncertainty, escalated compliance costs, legal disputes, and associated fees. Together, these constitute a high risk for double and over-taxation for cross-border businesses and, therefore, act as a barrier within the Single Market. Accordingly, the Proposal aims to harmonize transfer pricing rules across EU Member States by incorporating the arm’s length principle into EU law.

Case C-714/20 of the Court of Justice of the EU (ECJ) is of particular interest to forwarding agents.

On May 11, 2022, the European Commission published an EU Directive proposal introducing a debt-equity bias reduction allowance (‘DEBRA’).

Cyberattacks Ukraine also affect European companies The war in Ukraine is a reality. A war that can have a major impact and in which cyber-attacks are also used as a weapon, affecting not only Ukraine, but also European companies and organisations. Our cyber-security experts issue a warning for an increased cyber risk which is also of great importance for your company.

From 2023 onwards all large organisations will be required to report on sustainability policy and performance. In April 2021, the European Commission presented the proposal for a Corporate Sustainability Reporting Directive (CSRD).

Since 27 September 2020 Dutch legal entities are required to register information regarding their UBOs in the UBO register. The UBO register is a direct consequence of European regulations. Its aim is to increase transparency among the individuals who are in control over companies, irrespective of the way in which an entity or concern is organized.

On the 30th of December 2020, the EU and China have concluded in principle the negotiations for a Comprehensive Agreement on Investment (CAI). This agreement will create a better balance in the EU-China trade relations and, in our view, create even more opportunities in the future for foreign direct investment (FDI) between the EU and China.