On October 22, 2019, Government published a French Ordinance No. 2019-1068 of 21 October 2019, regarding the Automatic and Compulsory Exchange of Information in the Field of Taxation in Relation to Cross-Border Devices for Reporting. The EU Directive 2018/822 of 25 May 2018 (commonly known as DAC6) provides for an obligation for intermediaries or taxpayers to report to the Administration potentially aggressive cross-border arrangements in order to enhance transparency and the fight against tax evasion and avoidance. This Directive contributes to the implementation by the EU of BEPS action 12 with regard to the mandatory disclosure of information applicable to aggressive or abusive transactions, devices or structures. This Directive came into force in the EU on 25 June 2018 and will take effect on 1 July 2020.

The Member States are obliged to transpose the Directive by 31 December 2019. Declarations may be exchanged by the tax authorities by 31 October 2020. Article 1649 AD, article 1649 AE, article 1649 AG, article 1729 C ter of this ordinance supplements the general tax code. Here, article 1649 AD describes the scope of the declarative obligation, article 1649 identifies the persons subject to the declarative obligation, article 1649 AG determines the operative event of the declaratory obligation and the time limit for the subscription of the declaration, and article 1729 C ter lays down the penalty for non-compliance with the declaratory obligation. Note that, the declaration of a cross-border device must be signed in electronic form with the tax authorities.

Under article 1729 C ter, failure to comply with a declaration or notification obligation requires the application of a fine no more than € 10,000. If this is the first offense in the current calendar year and the previous three years, the amount of the penalty cannot exceed € 5,000. The fine does not apply to the failure of the taxpayer concerned by a cross-border system to report annually on the use of the taxpayer for the previous year. Finally, the amount of the fine applied to the same intermediary or to the same taxpayer concerned may not exceed € 100,000 per calendar year.