The EU List of 17 Non-cooperative Tax Jurisdictions

The Council of the European Union has released its first-ever list of non-cooperative tax jurisdictions. 17 jurisdictions have been identified as non-cooperative in tax matters for falling short of the stipulated standards of tax good governance and for failing to address these shortcomings.

The assessment was based on the following criteria and sub-criteria:

 1.      Transparency

1.1.   Commitment to implementing the automatic exchange of information either by signing the Multilateral Competent Authority Agreement or through bilateral agreements;

1.2.   Membership of the Global Forum on transparency and exchange of information for tax purposes and achieving a satisfactory rating;

1.3.   Being a signatory to the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters or joint agreements covering all EU Member States. 

 2.      Fair Taxation

2.1.   Existence of harmful tax regimes;

2.2.   Existence of tax regimes that facilitate offshore structures, which encourage profit-making without real economic activity.

 3.      Anti- Base Erosion and Profit Shifting (BEPS) Measures

3.1.   Membership of the Inclusive Framework on BEPS or implementation of BEPS minimum standards, which have been devised by members of the OECD to combat tax avoidance by multinational corporations.

 The following jurisdictions are listed in the report according to the criteria with which they have failed to comply in respect of tax matters:

The jurisdictions above have not ratified the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters which has recently been amended. Additionally, the Council of the EU has strongly advised that the jurisdictions commit to addressing the said deficiencies by December 31st, 2018. However, no clear statement has been issued so far by these jurisdictions pledging to improve their practices based on each criterion within the prescribed time frame.

 Furthermore, the Council of the EU will monitor each jurisdiction’s performance by measuring it against the criteria as set out in the report to evaluate the jurisdiction's commitment towards better international tax practices.

Although the Hong Kong SAR of China did not appear on the list of non-cooperative tax jurisdictions, it was included on the watch list. The Council of the EU will monitor Hong Kong’s commitment to the criteria as listed above, setting the deadline for evaluation at the end of 2018. 

 Subject to full compliance with the tax good governance requirements, the jurisdiction will have the opportunity to be removed from the list upon the yearly revision and gain access to certain cooperation mechanisms between the European Union and its member states; development cooperation schemes would be available to developing countries.

 It is important to note that this report only gives recommendations to the jurisdictions listed and does not propose coercive measures against jurisdictions failing to reach the prescribed targets or improve their tax practices.

 This article is based on the conclusions of the Council of the European Union on the EU list of non-cooperative jurisdiction for tax purposes from its meeting on December 5, 2017. 

 CW CPA can assist overseas companies in analyzing the implications that changes in international tax policy can have on their operations and in ensuring meticulous compliance with the relevant regulations and reporting requirements. If you have any questions regarding this article or any other enquiries about tax practices, please contact Miss May Ly by email (

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