Expert Speak Details


Mr. Ashutosh Mohan Rastogi, Partner
Dhruv Seth, Associate- Amicus, Advocates & Solicitors


Under Indian Transfer Pricing regulations constituent entities of multinationals groups must file a Country by Country Report ('CbCR') in India if the MNE has consolidated revenue of more than INR 5500 crores (approximately USD 825 Million/750 Million Euros) in the previous year.

In a recent development, India and US have signed an Inter-Governmental Agreement on 27th March 2019 ('The Agreement') for exchange of CbCRs. This shall enable authorities to automatically exchange CbCR filed in the jurisdiction of the Ultimate Parent Entity for the years commencing on or after January 1, 2016.


India CbCR regulations

Generally, an Indian constituent entity (of an MNE group headquartered overseas) is required to file only an intimation reporting details of the parent or alternate reporting entity in Form No 3CEAC. Thereafter, Indian authorities shall source CbCR through the exchange of information mechanism. However, a constituent entity must file CbCR in India where:

1. The parent entity is not obligated to file the CbCR; or

2. If India does not have an agreement for exchange of CbCR with a specific country; or

3. There has been a systemic failure and such failure is intimated to the Indian constituent entity.

Until The Agreement was signed, constituent entities of US multinational groups fell in second category.


Effect of the Agreement

The Agreement would now enable India and US to exchange CbCRs pertaining to financial years commencing on or after January 1, 2016.


Amicus Comments  

India has already signed the Multilateral Competent Authority Agreement ('MCAA') for exchange of CbCRs which has enabled exchange of CbCRs with 62 jurisdictions. Providing access to CbCRs through an international exchange mechanism has been the preferred option to local filing for a number of reasons foremost being non-availability of centralized data at local levels to make CbCR compliances.

Earlier[1], Indian affiliates of US multinationals were obliged to file CbCR in India unless they had opted for filing in other countries through surrogate parent companies or alternate reporting entities. As a result of The Agreement, Indian subsidiaries of US multinationals companies are no longer required to file CbCRs with Indian Government and are put par with several other jurisdictions with which India has signed the exchange of information agreement.



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[1] Rule 10DB(4) of Income Tax Rules

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