In more detail
Codified in the French Commercial Code, the ordinance essentially reproduces the main provisions of the European text. Thresholds for reporting, reporting procedures and publication and accessibility procedures are set out in a decree and an order2.
The ordinance details in the articles 1 to 4 the enterprises covered by the public CbCR rules whose consolidated revenue exceed a threshold set by decree (EUR 750 million), whether they are in France or abroad (standalone undertakings, ultimate parent undertakings and their subsidiaries and branches).
With regard to the form of the companies, the ordinance specifies that only commercial companies are concerned and for foreign companies those with a legal form comparable to joint-stock companies and limited liability companies. In the case of French société en nom collectif and société en commandite simple, the provisions apply only to those where all the partners with unlimited liability are French sociétés anonymes, sociétés à responsabilité limitée or foreign companies of comparable form.
The ordinance incorporates the Directive's requirement for subsidiaries undertakings or branches not subject to the above provisions to publish a report on income tax information where they serve no other objective than to circumvent the reporting requirements.
Entities operating in the banking sector, which are already subject to a country-by-country reporting obligation (in application of directive 2013/36/EU), are exempt from the public CbCR obligation (as provided for in the Directive).
The ordinance also specifies the items to be included in the report. This includes information relating to all the standalone undertaking's or ultimate parent undertaking's activities, including those of all related companies consolidated in the financial statements for the relevant year, i.e. a brief description of the nature of the activities, the number of full-time equivalent employees, revenues, the amount of profit or loss before income tax, the amount of income tax accrued, the amount of income tax paid on a cash basis, and the amount of accumulated earnings at the end of the financial year.
French subsidiaries or branches will have to collect the required information from their foreign ultimate parent undertaking. If the latter refuses to comply with this request, then the subsidiary or branch, via its legal representative in France, will have to publish only the information at its disposal, together with a statement that the parent company do not make the necessary information available.
Details for reporting, publishing and making accessible are set out in the aforementioned decree and order.
Following the Directive, the ordinance provides for a temporary safeguard clause, under which companies will be able to temporarily omit from the report information that is too sensitive ("where their disclosure would be seriously prejudicial to the commercial position of the undertakings to which the report relates"), which conditions of implementation are described in the aforementioned decree.
Lastly, as required by the Directive, the ordinance stipulates that statutory auditors will have to certify that the undertaking concerned has actually published the information in accordance with the provisions of the French Commercial Code relating to public CBCR.
The provisions of the ordinance and of the decree apply to financial years beginning on or after 22 June 2024.
1 Ordinance n° 2023-483, 21 June 2023
2 Décret n° 2023-493, 22 june 2023 ; Arrêté 22 june 2023 as regards the disclosure of income tax information by certain undertakings and branches.
