The Danish Tax Agency announced on 8 July 2025 that it signed an agreement with the Faroe Islands to automatically exchange country-by-country tax reports.
The Danish Tax Agency announced on 8 July 2025, it had signed a Competent Authority Agreement (CAA) with the Faroe Islands on 28 March 2025
This agreement establishes the automatic exchange of country-by-country (CbC) reports between the two jurisdictions. CbC reporting is part of Action 13 of the OECD/G20 Base Erosion and Profit Shifting (BEPS) project, aimed at increasing tax transparency and combating tax avoidance.
Under the agreement, certain multinational groups are required to submit three types of reports: a CbC report, a master file, and a local file. These documents provide detailed information on the group’s global revenue, profits, taxes paid by jurisdiction, the nature of its activities, and related-party cross-border transactions.
The reports must be submitted within 12 months after the end of the relevant financial year and will now be exchanged automatically between Denmark and the Faroe Islands under OECD BEPS standards.
