On October 6, 2015 the Council of Ministers approved the proposal of the European Commission for an automatic exchange of information on cross-border rulings and similar arrangements. This will require the amendment of the Mutual Assistance Directive, which regulates the exchange of information between the tax authorities of the EU Member States. On the basis of this amendment, Member States will automatically exchange information on rulings with effect from January 1, 2017. With this amendment, the EU is broadly in line with the final BEPS Action Plan, and particularly Action 5, which was published on October 5, 2015.


The current text of the Mutual Assistance Directive (Directive 2011/16/EU) already facilitates the spontaneous exchange of rulings, but this takes place on a case-by-case basis and provides a lot of room for interpretation by Member States. Therefore, the Commission believes that it is not effective enough. By virtue of the Mutual Assistance Directive, as of January 1, 2015 Member States are obliged to automatically exchange certain information regarding a number of specifically mentioned income components of individuals. This obligation has now been expanded to include information on cross‑border rulings.

New automatic exchange obligation

The revised Directive imposes an obligation on Member States to automatically exchange information on cross-border rulings and similar arrangements. This concerns information about agreements with tax authorities that provide taxpayers with advance certainty. The new requirement relates to APAs (advance pricing agreements) and ATRs (advance tax rulings), but may also include other agreements with tax authorities, given that the definitions in the Directive are described in broad terms. For example, agreements on the presence or absence of a permanent establishment are also covered. The new exchange obligation does not concern purely domestic rulings nor rulings relating solely to a natural person. In view of the broad wording of the Directive, APAs with third countries will not be excluded from the exchange either. For APAs with third countries a limited exception is included for cases where the treaty to avoid double taxation prohibits such exchanges with that third country.

The information will be exchanged in a standard format with all other Member States and to a limited extent with the European Commission. On the basis of this amendment, Member States will automatically exchange information on rulings concluded as of January 1, 2017. Information about rulings that were concluded during the five years before January 1, 2017 will also be exchanged. However rulings issued, amended or renewed between January 1, 2012 and January 1, 2014 will only be exchanged if they are still  in force on that latter date.  With respect to the automatic exchange of past rulings, an exception will probably still apply to certain companies with a consolidated group turnover of up to EUR 40 million, although the exact details of this exception are currently not known.

Each quarter, the following information on the rulings concluded in that quarter will have to be exchanged:

  1. the identification of the taxpayer and the group to which it belongs;
  2. a summary of the content of the ruling, including a description of the relevant activities or transactions;
  3. the date of issue, modification or extension of the ATR or APA;
  4. the beginning and end of the period of the ATR or APA;
  5. the type of ATR or APA;
  6. the number of transactions to which the ATR or APA applies if this is stated in the ruling;
  7. the description of the criteria used to determine the relative prices in the case of an APA;
  8. the designation of the transfer pricing method used or the transfer price itself;
  9. the identification of the Member States concerned;
  10. the identification of any other taxable person involved, not being natural persons in the Member States concerned;
  11. the indication whether the information exchanged is based on the ATR or APA itself or, in the event of an APA with a third country excluded from the exchange, is based on the request for the APA.

The Commission will only have access to limited information, for example it will not be privy to the information on the identity of the taxpayer or the content of the rulings. Where appropriate, Member States may request additional information, including the full text of the relevant ruling.

The information exchanged in this way must be kept confidential by the Member States. Member States may also limit the summary so that no commercial secrets are revealed.                                                                                                  

Other initiatives

These proposals should be seen in the context of similar proposals which the OECD announced on October 5, 2015 within the scope of BEPS 5, since this action plan also calls for the mandatory automatic exchange of information about rulings.

The proposed exchange of information should also be distinguished from the investigation by the Commission into the arrangements made by tax authorities with certain multinationals in the context of possible state aid. Although part of the proposed information will also be exchanged with the Commission, this does not mean that Member States are released from the obligation to notify the Commission in advance if there is a possibility that state aid has been provided.

Next steps

Now that this proposal has been approved by all Member States, the text must be finalized. This is expected by the end of the year. The individual Member States will then have to transpose the new rules into their domestic legislation and administration before the end of 2016. The obligation to exchange will become effective on January 1, 2017.


With this amendment to the Mutual Assistance Directive, the EU has set the tone for the automatic exchange of information on rulings. From the perspective of taxpayers’ rights we would like to remark that this exchange of information happens without involvement from taxpayers, who have no means of knowing whether it is justified that certain information is exchanged or whether the information is correct.

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