### 11. calls for not ring fencing the digital economy as the tax challenges that the international tax system is currently facing are not only due to the digitalisation of the economy but also linked with an even greater globalised economy; ### 11. calls for not ring fencing the digital economy as the tax challenges that the international tax system is currently facing are not only due to the digitalisation of the economy but also linked with an even greater globalised economy; calls on the if and the european commission to analyse the impact of excluding specific sectors (e.g. extractive industries) in terms of revenue collection , especially for developing countries;


### 12. considers that the scope of the reform should cover all large firms having the possibility to engage in beps practices by exploiting legal loopholes; ### 12. notes that there is currently no clear definition for the concept of “consumer-facing businesses”; considers that the scope of the reform should not only cover highly digital or consumer facing businesses as currently suggested in the oecd secretariat’s proposal but cover all large firms having the possibility to engage in beps practices by exploiting legal loopholes; should this scope remain , calls on the if to clarify how to define which activities would be subject to new taxing rights in order to avoid a high burden for companies and tax administrations;


### 12. considers that the scope of the reform should cover all large firms having the possibility to engage in beps practices by exploiting legal loopholes; ### 12. considers that the scope of the reform should cover all large firms having the possibility to engage in beps practices by exploiting legal loopholes , avoiding to add further and unnecessary burdens to smes;


### 15. welcomes the idea to develop a country specific revenues threshold calibrated to ensure smaller economies also get their fair share of taxing rights; reminds in this context the eu proposal for sdp; ### 15. welcomes the idea to develop a country specific revenues threshold calibrated to ensure smaller economies also get their fair share of taxing rights; recalls in this context the eu proposal for sdp;


### 16. welcomes the idea that this new nexus would be a stand-alone provision to ensure no need to revise all tax treaties; ### 16. welcomes the idea that this new nexus would be a stand-alone provision to ensure no need to revise all tax treaties; calls for further clarification on how the current rules on profit allocation will need to be changed to include the idea of taxing a firm even without a physical presence in a country;


### 17. welcomes the idea to develop a new allocation of taxing rights that goes beyond the arm’s length principle (alp) and that will allocate new taxation rights to market jurisdictions; ### 17. welcomes the idea to develop a new allocation of taxing rights that goes beyond the arm’s length principle (alp) and that will allocate new taxation rights to market jurisdictions; calls however for further guidance on how suggestions for formulary apportionment can still be combined with maintaining transfer pricing rules for profit allocation as suggested by the oecd;


### 18. considers that making a distinction between routine and non-routine profits , currently not clearly defined , will add complexity and uncertainty for businesses , notably as regards oecd transfer pricing guidelines; is concerned that this could add opportunities to circumvent the newly agreed rules; ### 18. questions the suggestion to make a distinction between routine and non-routine profits , for the proposal on a residual profit split; is concerned that this suggestion will lead to an artificial distinction only , undermining taxing rights of the market jurisdictions; questions the suggestion to continue with existing transfer pricing rules for allocation of the part of non-routine profit not allocated to market jurisdictions; wonders if this will not add too much complexity and uncertainty for businesses , notably as regards oecd transfer pricing guidelines; is concerned that this could add opportunities to circumvent the newly agreed rules; calls on the if instead to look into the possibility of apportioning the global profits of taxpayers using factors reflecting real economic activities in each country such as sales , employments and assets;


### 19. would therefore rather invite member states to push for a solution that would favour fractional apportionment , based on factors representing the value creation , such as sales , employees , assets and users; in that regard , recalls therefore its position on the c(c)ctb and sdp proposals; ### 19. would therefore rather invite member states to push for a solution that would favour fractional apportionment , based on factors representing economic activity and value creation , especially sales , employees , assets and users; in that regard , recalls therefore its position on the c(c)ctb and sdp proposals;


### 20. welcomes the willingness to ensure tax certainty and to limit dispute that could arise from the implementation of the new nexus and the new allocation of taxing rights; ### 20. welcomes the willingness to ensure tax certainty and to limit dispute that could arise from the implementation of the new nexus and the new allocation of taxing rights; disagrees with the proposal under amount c referring to mandatory arbitration mechanisms , while the european union has already adopted a tax dispute resolution mechanism based on the minimum standard in beps action 14;


### 20. welcomes the willingness to ensure tax certainty and to limit dispute that could arise from the implementation of the new nexus and the new allocation of taxing rights; ### 20. welcomes the willingness to ensure tax certainty and to limit dispute that could arise from the implementation of the new nexus and the new allocation of taxing rights; calls therefore for simple and harmonized rules;


### 21. welcomes the globe proposal which aims at ensuring that a minimum level of taxes is paid where value is created and where economic activity is taking place; ### 21. welcomes the globe proposal which aims at ensuring that a minimum level of taxes is paid where value is created and where economic activity is taking place; welcomes the objectives to reduce the incentive for taxpayers to engage in profit shifting and establish a floor for tax competition among jurisdictions; raises concerns however on the possible future risk to see a global race to the bottom towards this minimum floor for corporate taxation by most countries;


### 22. invites member states to ensure that the globe proposal provides for the simplest framework that would not lead to the development of new harmful tax schemes; ### 22. invites member states to ensure that the globe proposal provides for the simplest framework that would not lead to the development of new harmful tax schemes; is concerned with the suggestion to consider outside the base to apply minimum taxation all tax regimes compliant with beps action 5; calls on the if to review its proposal on this aspect and to re-discuss criteria to define harmful tax regimes within the beps action plan;


### 25. considers that any discussion at oecd/g20 towards a minimum tax rate should focus on effective tax rates; considers that any minimum effective rate should be set at a fair and sufficient level to discourage profit shifting and prevent tax competition; ### 25. considers that any discussion at oecd/g20 towards a minimum tax rate should focus on effective tax rates; considers that the if should agree on a minimum effective corporate tax rate of 20 percent as a fair and sufficient level to discourage profit shifting and prevent tax competition;


### 25. considers that any discussion at oecd/g20 towards a minimum tax rate should focus on effective tax rates; considers that any minimum effective rate should be set at a fair and sufficient level to discourage profit shifting and prevent tax competition; ### 25. considers that any discussion at oecd/g20 towards a minimum tax rate should focus on effective tax rates; considers that any minimum effective rate should be set at a fair and sufficient level to discourage profit shifting and prevent tax competition; calls for a minimum effective rate of 20%;


### 27. regrets the lack of common approach at eu level vis-à-vis the current ongoing international negotiations; ### 27. regrets the lack of common approach at eu level vis-à-vis the current ongoing international negotiations and the reluctance from some member states to have the union speak with one unified voice on this issue; calls on each member state and the commission to make its position on the oecd secretariat’s proposals for pillar 1 and pillar 2 publicly known;


### 29. invites the european commission to provide support in the elaboration of such eu position; ### 29. invites the european commission to provide support in the elaboration of such eu position; urges the commission to provide an impact assessment on revenues for every member states for both pillars;


### 30. strongly encourages the commission and the member states to achieve a deal at international level which would then be transposed at eu level through relevant eu and national legislations; likewise supports the commitment of the commission president-elect to propose an eu solution , should an international deal not be reached by the end of 2020; ### 30. strongly encourages the commission and the member states to achieve a deal at international level which would avoid the proliferation of unilateral measures by individual countries; calls on the commission to present a legislative proposal as soon as possible in case of a deal so that it can be transposed at eu level through relevant eu and national legislations; likewise supports the commitment of the commission president-elect to propose an eu solution , should an international deal not be reached by the end of 2020; calls on the commission to explore the options to avoid a legal base requiring unanimity in council; recalls that any new proposal should not come at the detriment of the adoption of the ccctb;


### 31. invites the council , with the support of the commission , to update the criteria of the eu list of non-cooperative jurisdictions for tax purposes once the international rules and/or the eu newly agreed reforms have been adopted , and notably the eu listing criteria on fair taxation; ### 31. invites the council , with the support of the commission , to update the criteria of the eu list of non-cooperative jurisdictions for tax purposes once the international rules and/or the eu newly agreed reforms have been adopted , and notably the eu listing criteria on fair taxation; calls on the code of conduct group to include if countries on the list as soon as information provided demonstrate a failure by these countries to comply with the list’s criteria; calls on the code of conduct group to re-assess the compliance of the united states with criterion 1 on transparency;


### 32. instructs its president to forward this resolution to the council and the commission , and to the governments and parliaments of the member states. ### 32. instructs its president to forward this resolution to the council and the commission , the oecd secretariat and to the governments and parliaments of the member states.


### 3. market data contributors shall , with regard to transactions in the instruments referred to in paragraph 1 that are concluded by investment firms outside a trading venue , provide the ctp with the market data concerning those transactions either directly or through an apa. ### 3. market data contributors shall , with regard to transactions in the instruments referred to in paragraph 1 that are concluded by investment firms outside a trading venue and with regard to the best bids and offers in shares , provide the ctp with the market data concerning those transactions either directly or through an apa.


### 4. market data contributors shall not receive any remuneration for the market data provided other than the revenue sharing as referred to in article 27da(2) , point (c). ### 4. market data contributors shall not receive any remuneration for the market data provided other than the revenue sharing as referred to in article 27h (1) point (c).


### 1. the commission shall set up an expert stakeholder group by [op add 3 months as of entry into force] to provide advice on the quality and the substance of market data , the common interpretation of market data and the quality of the transmission protocol referred to in article 22a(1). the expert stakeholder group shall provide advice on a yearly basis. that advice shall be made public. ### 1. the commission shall set up an expert stakeholder group by [op add 3 months as of entry into force] to provide advice on the quality and the substance of market data , the common interpretation of market data and the quality of the transmission protocol referred to in article 22a(1). the expert stakeholder group shall provide advice on a yearly basis. that advice shall be made public.


### 1. by [op insert date 3 months as of entry into force] , esma shall organise a selection procedure for the appointment of the ctp for a five year term. esma shall organise a separate selection procedure for each of the following asset classes: shares , exchange traded funds , bonds and derivatives (or relevant subclasses of derivatives). ### 1. by [op insert date 12 months as of entry into force] , esma shall organise a selection procedure for the appointment of the ctp for a five year term. esma shall organise a transparent and open separate selection procedure for each of the following asset classes: shares , exchange traded funds , bonds and derivatives (or relevant subclasses of derivatives).


### 3. the first selection procedure organised for shares shall only invite bids for the provision of a consolidated tape containing post trade data. prior to subsequent selection procedures , esma shall assess market demand and revenue impacts on regulated markets and based on that assessment , report to the commission on the opportunity of adding best bids and offers and corresponding volumes to the tape. based on that report and on the experience gained further to the first selection procedure , the commission is empowered to adopt a delegated act specifying the appropriate level of pre-trade data to be contributed to the ctp. ### 3. for each asset class , esma shall issue a call for tenders specifying the selection criteria and the deadline for application. esma shall assess whether the application for authorisation is complete within 20 working days of its receipt. within three months from the receipt of complete applications , esma shall select the ctp through a reasoned decision. the reasoned decision shall be communicated to the selected and rejected applicants within five days after its adoption.


### 4. the selection of the ctp for shares shall , in addition to the criteria in paragraph 2 , consider the revenue participation scheme , and in particular the formula , applicable to regulated markets that are market data contributors. esma shall , when considering the competing tenders , select the ctp for shares that offers the revenue participation scheme that provides regulated markets , in particular smaller regulated markets , with the highest amount of revenue that remains for distribution once deducted operating costs and a reasonable margin. this revenue shall be distributed in accordance with article 27h(1)(c) , and in a manner commensurate to the market data contributed according to article 22a. ### 4. the selection of the ctp for shares shall , in addition to the criteria in paragraph 2 , consider the revenue participation scheme , and in particular the formula , applicable to regulated markets that are market data contributors. esma shall , when considering the competing tenders , select the ctp for shares that offers the revenue participation scheme that provides smaller regulated markets , with the highest amount of revenue that remains for distribution once deducted operating costs and a reasonable margin. this revenue shall be distributed in accordance with article 27h(1)(c) , and in a manner commensurate to the market data contributed according to article 22a.


### 5. esma shall adopt a fully reasoned decision selecting and authorising the entities operating the consolidated tapes within 3 months as of initiation of the selection procedure referred to in paragraph 2. such reasoned decision shall specify the conditions under which the ctps shall operate , and in particular the level of fees referred to in paragraph 2 , point (g) and for shares the level of the participation referred to in paragraph 3 , in particular for smaller regulated markets. ### 5. esma shall adopt a fully reasoned decision selecting and authorising the entities operating the consolidated tapes within 3 months as of initiation of the selection procedure referred to in paragraph 2. such reasoned decision shall specify the conditions under which the ctps shall operate , and in particular the level of fees referred to in paragraph 2 , point (g).


### ensure that the publication of the core market data complies with the applicable waivers and deferrals in articles 4 , 7 , 11 , 14 , 20 and 21; ### deleted


### 2. ctps shall adopt and publish on their website service level standards covering all of the following: ### 2. ctps shall adopt and publish on a quaterly basis on their website service level standards covering all of the following:


### 3. ctps shall have sound security mechanisms in place designed to guarantee the security of the means of transfer of market data between the market data contributors and the ctp and between the ctp and the users and to minimise the risk of data corruption and unauthorised access. ctps shall maintain adequate resources and have back-up facilities in place to offer and maintain its services at all times. ### 3. ctps shall have sound security mechanisms in place designed to guarantee the security of the means of transfer of market data between the market data contributors and the ctp and between the ctp and the users and to minimise the risk of data corruption and unauthorised access. ctps shall maintain adequate resources and have back-up facilities in place to offer and maintain its services at all times. ctps shall have in place adequate processes and facilities to limit the energy consumption generated by the storage of historical data.


### (20) the following article 32a is inserted: ### deleted


### article 39a ### article 39a


### investment firms acting on behalf of clients shall not receive any fee or commission or non-monetary benefits from any third party for forwarding client orders to such third party for their execution.; ### 1. investment firms acting on behalf of clients shall take all the necessary steps to obtain , when executing orders , the best possible result for their clients taking into account price , costs , speed , likelihood of execution and settlement , size , nature or any other consideration relevant to the execution of the order. nevertheless , where there is a specific instruction from the client the investment firm shall execute the order following the specific instruction , after having verified that the client had all the necessary information , including the risks it would be exposed to , to make a well-informed decision.


### (4) to date , however , no supervised entity has applied for authorisation to act as a ctp. esma has identified three main obstacles that have prevented supervised entities to apply for registration as a ctp33 . first , a lack of clarity as to how the ctp is to procure market data from the various execution venues or from the data reporting service providers concerned. second , insufficient quality in terms of harmonisation of the data reported by those execution venues to allow for a cost-efficient consolidation. third , a lack of commercial incentives to apply for authorisation as a ctp. it is therefore necessary to remove those obstacles. such removal requires , first , that all trading venues and systematic internalisers (‘sis’) provide ctps with market data (provision rule). it secondly requires an improvement of the data quality by harmonising the data reports that trading venues and sis should submit to the ctp. ### (4) to date , however , no supervised entity has applied for authorisation to act as a ctp. esma has identified three main obstacles that have prevented supervised entities to apply for registration as a ctp33 . first , a lack of clarity as to how the ctp is to procure market data from the various execution venues or from the data reporting service providers concerned. second , insufficient quality in terms of harmonisation of the data reported by those execution venues to allow for a cost-efficient consolidation. third , a lack of commercial incentives to apply for authorisation as a ctp. it is therefore necessary to remove those obstacles. such removal requires , first , that all trading venues and systematic internalisers (‘sis’) provide ctps with market data (provision rule). it secondly requires an improvement of the data quality by harmonising the data reports that trading venues and sis should submit to the ctp. furthermore , the design of the ctp should ensure that data providers receive a fair remuneration for submitting their data , in particular small trading venues , which business model mostly relies on data selling. finally , retail investors and academics should be able to have free and unlimited access to the data disclosed by the ctp.


### (7) dark trading is trading without pre-trade transparency , using the reference price waiver laid down in article 4(1) , point (a) of regulation (eu) no 600/2014 and the negotiated trade waiver laid down in article 4(a) point (a) , point (i) of that regulation. the use of both waivers is capped by the double volume cap (‘dvc’). the dvc is a mechanism that limits the level of dark trading to a certain proportion of total trading in an equity instrument. the amount of dark trading in an equity instrument on an individual venue may not exceed 4% of total trading in that instrument in the union. when this threshold is breached , dark trading in that instrument on that venue is suspended. secondly the amount of dark trading in an equity instrument in the union may not exceed 8% of total trading in that instrument in the union. when this threshold is breached all dark trading in that instrument is suspended. the venue specific threshold leaves room for continued use of those waivers on other platforms on which trading in that equity instrument is not yet suspended , until the union wide threshold is breached. this causes complexity in terms of monitoring the levels of dark trading and of enforcing the suspension. to simplify the double volume cap while keeping its effectiveness , the new single volume cap should rely solely on the eu-wide threshold. that threshold should be lowered to 7 % to compensate for a potential increase of trading under those waivers as a consequence of abolishing the venue specific threshold. ### (7) dark trading is trading without pre-trade transparency , using the reference price waiver laid down in article 4(1) , point (a) of regulation (eu) no 600/2014 and the negotiated trade waiver laid down in article 4(a) point (a) , point (i) of that regulation. the use of both waivers is capped by the double volume cap (‘dvc’). the dvc is a mechanism that limits the level of dark trading to a certain proportion of total trading in an equity instrument. the amount of dark trading in an equity instrument on an individual venue may not exceed 4% of total trading in that instrument in the union. when this threshold is breached , dark trading in that instrument on that venue is suspended. secondly the amount of dark trading in an equity instrument in the union may not exceed 8% of total trading in that instrument in the union. when this threshold is breached all dark trading in that instrument is suspended. the venue specific threshold leaves room for continued use of those waivers on other platforms on which trading in that equity instrument is not yet suspended , until the union wide threshold is breached. this causes complexity in terms of monitoring the levels of dark trading and of enforcing the suspension. to simplify the double volume cap while keeping its effectiveness , the new single volume cap should rely solely on the eu-wide threshold. that threshold should be lowered to 6 % to compensate for a potential increase of trading under those waivers as a consequence of abolishing the venue specific threshold.


### (9) to ensure an adequate level of transparency , the price of a non-equity transaction should be published as close to real time as possible and only be delayed until maximally the end of the trading day. however , in order not to expose liquidity providers in non-equity instruments to undue risk , it should be possible to mask volumes of transactions for a short period of time , which should not be longer than two weeks. the exact calibration of the various buckets corresponding to different time deferrals should be left to esma due to the technical expertise required to specify the calibration as well as due to the need to allow for the flexibility to amend the calibration. those deferrals should be based on the liquidity of the non-equity instrument , the size of the transaction and , for bonds , the credit rating and it should no longer include the size specific to the instrument concerned. ### (9) to ensure an adequate level of transparency , the price of a non-equity transaction should be published as close to real time as possible and only be delayed until maximally the end of the trading day. however , in order not to expose liquidity providers in non-equity instruments to undue risk , it should be possible to mask volumes of transactions for a short period of time , which should not be longer than one week. the exact calibration of the various buckets corresponding to different time deferrals should be left to esma due to the technical expertise required to specify the calibration as well as due to the need to allow for the flexibility to amend the calibration. those deferrals should be based on the liquidity of the non-equity instrument , the size of the transaction and , for bonds , the credit rating and it should no longer include the size specific to the instrument concerned.


### (20) competition among consolidated tape providers ensures that the consolidated tape is provided in the most efficient way and under the best conditions for users. however , no entity has , up until now , applied to act as a consolidated tape provider. it is therefore considered appropriate to empower esma to periodically organise a competitive selection procedure to select a single entity which is able to provide the consolidated tape for each specified asset class. taking into account the novelty of the proposed scheme , esma should only mandate the provision of post-trade transparency data for the first selection procedure that it runs in relation to shares. at least 18 months before the launch of the second selection procedure , esma should submit a report to the commission assessing whether there is market demand for extending the data contributed to the tape to pre-trade data. on the basis of such a report , the commission should be empowered , by way of a delegated act , to further specify the depth of pre-trade data to the tape. ### (20) competition among consolidated tape providers ensures that the consolidated tape is provided in the most efficient way and under the best conditions for users. however , no entity has , up until now , applied to act as a consolidated tape provider. it is therefore considered appropriate to empower esma to periodically organise a competitive selection procedure to select a single entity which is able to provide the consolidated tape for each specified asset class.


### (25) it is necessary to ensure that consolidated tape providers remedy information asymmetries in the capital markets in a sustainable manner , and to ensure that consolidated tape providers provide consolidated data that are reliable. consolidated tape providers should therefore be obliged to adhere to organisational requirements and quality of service standards that must be met at all times once they have been authorised by esma. quality standards should cover aspects related to the collection of consolidated core market data , accurate time-stamping of such data at various stages in the delivery chain , collection and administration of market data subscription fees , and allocation of revenue to market data contributors. ### (25) it is necessary to ensure that consolidated tape providers remedy information asymmetries in the capital markets in a sustainable manner , and to ensure that consolidated tape providers provide consolidated data that are reliable. consolidated tape providers should therefore be obliged to adhere to organisational requirements and quality of service standards that must be met at all times once they have been authorised by esma. quality standards should cover aspects related to the collection of consolidated core market data , accurate time-stamping of such data at various stages in the delivery chain , collection and administration of market data subscription fees , and allocation of revenue to market data contributors. consolidated tape providers shall ensure to provide data in an easily accessible format and free access for specific users such as retail investors and academics.


### (26) in order to safeguard market participants’ continued trust in the operation of a consolidated tape provider , such entities should periodically make a series of public reports concerning compliance with their obligations under this regulation , in particular on performance statistics and incident reports relating to data quality and systems. due to the highly technical nature of the substance of the report , esma should be empowered to specify the substance , format and timing. ### (26) in order to safeguard market participants’ continued trust in the operation of a consolidated tape provider , such entities should periodically make a series of public reports concerning compliance with their obligations under this regulation , in particular on performance statistics and incident reports relating to data quality and systems. consolidated tape providers shall also put in place adequate protocols to mitigate their exposures to cyber-risk and their environmental impact. due to the highly technical nature of the substance of the report , esma should be empowered to specify the substance , format and timing.


### (30) an ad-hoc suspension mechanism is necessary to ensure that the commission may swiftly react to significant changes in market conditions that may have a material effect on the trading of derivatives and their counterparties. where such market conditions are present , and upon the request of the competent authority of a member state , the commission should be able to suspend the trading obligation , independently from any suspension of the clearing obligation. such a suspension of the trading obligation should be possible where the activities of an eu investment firm with a non-eea counterparty are unduly affected by the scope of the eu trading obligation on derivatives and where that investment firm acts as a market-maker in the category of derivatives subject to the trading obligation. the issue of overlapping dtos is particularly acute when trading with counterparties domiciled in a third-country jurisdiction that applies its own dto. this suspension would also help eu counterparties remaining competitive on global markets. when deciding upon the suspension of the trading obligation , the commission should take into consideration the impact of such suspension on the clearing obligation laid down in regulation (eu) no 648/2012. ### deleted


### (32) financial intermediaries should strive to achieve the best possible price and the highest possible likelihood of execution for trades that they execute on behalf of their clients. to that end , financial intermediaries should select the trading venue or counterparty for executing their client trades solely on the basis of achieving best execution for their clients. it should be incompatible with that principle of best execution that a financial intermediary receives a payment from a trading counterpart in exchange for ensuring the execution of client trades. investment firms should be therefore be prohibited from receiving such payment. ### (32) financial intermediaries should strive to achieve the best possible price and the highest possible likelihood of execution for trades that they execute on behalf of their clients. to that end , financial intermediaries should select the trading venue or counterparty for executing their client trades solely on the basis of achieving best execution for their clients. lack of harmonisation of what is entailed by the best execution requirements has led to divergent practices across the eu. therefore , a new article 39a is introduced to specify the execution rules for retail orders.


### 1. trading venues shall suspend their use of the waivers referred to in article 4(1) , point (a) , and 4(1) , point (b)(i) where the percentage of volume traded in the union in a financial instrument carried out under those waivers exceeds 7% of the total volume traded in that financial instrument in the union. trading venues shall base their decision to suspend the use of those waivers on the data published by esma in accordance with paragraph 4 , and shall take such decision within two working days after this publication of those data and for a period of six months.; ### 1. trading venues shall suspend their use of the waivers referred to in article 4(1) , point (a) , and 4(1) , point (b)(i) where the percentage of volume traded in the union in a financial instrument carried out under those waivers exceeds 6% of the total volume traded in that financial instrument in the union. trading venues shall base their decision to suspend the use of those waivers on the data published by esma in accordance with paragraph 4 , and shall take such decision within two working days after this publication of those data and for a period of six months.;


### based on the deferral regime as set out in paragraph 4 , competent authorities shall authorise market operators and investment firms operating a trading venue to defer the publication of the price of transactions until the end of the trading day , or the volume of transactions for a maximum of two weeks.; ### based on the deferral regime as set out in paragraph 4 , competent authorities shall authorise market operators and investment firms operating a trading venue to defer the publication of the price of transactions until the end of the trading day , or the volume of transactions for a maximum of one week.;


### 3. competent authorities may , when authorising a deferred publication as referred to in paragraph 1 with regard to transactions in sovereign debt , allow market operators and investment firms operating a trading venue: ### 3. competent authorities may , when authorising a deferred publication as referred to in paragraph 1 with regard to transactions in sovereign debt of their member state , allow market operators and investment firms operating a trading venue:


### 2. this article and articles 15 , 16 and 17 shall apply to systematic internalisers when they deal in sizes up to twice the standard market size. systematic internalisers shall not be subject to this article and articles 15 , 16 and 17 when they deal in sizes above twice the standard market size. ### 2. this article and articles 15 (1) and 17 shall apply to systematic internalisers when they deal in sizes up to twice the standard market size. systematic internalisers shall not be subject to this article and articles 15 , 16 and 17 when they deal in sizes above twice the standard market size.


### (5) according to article 72e(4) , first subparagraph , of regulation (eu) no 575/2013 , resolution authorities may permit a g-sii with an mpe resolution strategy to deduct certain holdings of own funds and eligible liabilities instruments of its subsidiaries that do not belong to the same resolution group by deducting a lower , adjusted amount specified by the resolution authority. article 72e(4) , second subparagraph , of that regulation requires that in such cases , the difference between the adjusted amount and the original amount is deducted from the loss absorbing and recapitalisation capacity of the subsidiaries concerned. in line with the tlac standard , that approach should take into account the risk-based and non-risk-based requirements for own funds and eligible liabilities of the subsidiary concerned. furthermore , that approach should be applicable to all third-country subsidiaries belonging to that g-sii , as long as those subsidiaries are subject to a local resolution regime that is equivalent to internationally agreed standards. ### (5) according to article 72e(4) ,first subparagraph , of regulation (eu) no 575/2013 , resolution authorities may permit a g-sii with an mpe resolution strategy to deduct certain holdings of own funds and eligible liabilities instruments of its subsidiaries that do not belong to the same resolution group by deducting a lower , adjusted amount specified by the resolution authority. article 72e(4) , second subparagraph , of that regulation requires that in such cases , the difference between the adjusted amount and the original amount is deducted from the loss absorbing and recapitalisation capacity of the subsidiaries concerned. in line with the tlac standard , that approach should take into account the risk-based and non-risk-based requirements for own funds and eligible liabilities of the subsidiary concerned. furthermore , that approach should be applicable to all third-country subsidiaries belonging to that g-sii , as long as those subsidiaries are subject to a local resolution regime that is legally enforceable and equivalent to internationally agreed standards according to the eu parent resolution authority. for third-country subsidiaries without an applicable equivalent resolution requirement the full amount of these holdings of own funds instruments or eligible liabilities instruments should be deducted.


### where at least two g-sii entities belonging to the same g-sii are resolution entities or third-country entities that would be resolution entities if they were established in the union , the eu parent institution of that g-sii shall calculate the amount of own funds and eligible liabilities referred to in article 92a(1) , point (a). that calculation shall be undertaken on the basis of the consolidated situation of the eu parent institution as if it were the only resolution entity of the g-sii. ### where at least two g-sii entities belonging to the same g-sii are resolution entities or third-country entities that would be resolution entities if they were established in the union , the eu parent institution of that g-sii shall calculate the amount of own funds and eligible liabilities referred to in article 92a(1) , point (a). that calculation shall be undertaken exclusively on the basis of the consolidated situation of the eu parent institution as if it were the only resolution entity of the g-sii.


### in article 45f of directive 2014/59/eu , paragraph 6 is deleted. ### deleted


### (3) it is necessary to lay down a common framework , in order to strengthen member states’ resilience against practices of tax avoidance and evasion linked to the use of undertakings which do not perform an economic activity even if presumably they are engaged with economic activity and therefore do not have any or have only minimal substance for tax purposes. this is done in order to ensure that undertakings lacking minimal substance are not used as instruments of tax evasion or tax avoidance. as those undertakings may be established in one member state but may be used with the effect of eroding the tax base of another member state , it is critical to agree on a common set of rules for determining what should be considered as insufficient substance for tax purposes in the internal market as well as for delineating specific tax consequences linked to such insufficient substance. where an undertaking has been found to have sufficient substance under this directive , this should not prevent the member states from continuing to operate anti-tax avoidance and evasion rules , provided that these are consistent with union law. ### (3) it is necessary to lay down a common framework , in order to strengthen member states’ resilience against practices of tax avoidance and evasion linked to the use of undertakings which do not perform an economic activity even if presumably they are engaged with economic activity and therefore do not have any or have only minimal substance for tax purposes. this is done in order to ensure that undertakings lacking minimal substance are not used as instruments of tax evasion or tax avoidance. as those undertakings may be established in one member state but may be used with the effect of eroding the tax base of another member state , it is critical to agree on a common set of rules for determining what should be considered as insufficient substance for tax purposes in the internal market as well as for delineating specific tax consequences linked to such insufficient substance. where an undertaking has been found to have sufficient substance under this directive , this should not prevent the member states from continuing to operate more stringent minimum substance rules and other anti-tax avoidance and evasion rules , provided that these are consistent with union law.


### (5) to ensure the proper functioning of the internal market , the proportionality and effectiveness of potential rules , it would be desirable to limit their scope to undertakings which are at risk of being found to lack minimal substance and used with the main objective of obtaining a tax advantage. it would therefore be important to establish a gateway criterion , in the form of a set of three cumulative , indicative conditions , in order to conclude which undertakings are sufficiently at risk as aforementioned to justify that they be subjected to reporting requirements. a first condition should enable the identification of undertakings presumably engaged mainly in geographically mobile economic activities , as the place where such activities are actually carried out is usually more challenging to identify. such activities normally give rise to important passive income flows. hence , undertakings , which income consists predominantly of passive income flows would meet this condition. it should also be taken into account that entities holding assets for private use , such as real estate , yachts , jets , artworks , or equity alone , may have no income for longer periods of time , but still enable significant tax benefits by way of owning those assets. as purely domestic situations would not pose a risk for the good functioning of the internal market and would be best addressed at domestic level , a second condition should focus on undertakings engaged in cross-border activities. engagement in cross-border activities should be established having regard , on the one hand , to the nature of the transactions of the undertaking , domestic or foreign , and on the other , to its property , given that entities that only hold assets for private , non-business , use may not engage in transactions for a considerable time. additionally , a third condition should point out to those undertakings which have no or inadequate own resources to perform core management activities. in this regard , undertakings that do not have adequate own resources tend to engage third party providers of administration , management , correspondence and legal compliance services or enter into relevant agreements with associated enterprises for the supply of such services in order to set up and maintain a legal and tax presence. outsourcing of certain ancillary services only , such as bookkeeping services alone , while core activities remain with the undertaking , would not suffice in itself for an undertaking to meet this condition. while such service providers might be regulated for other , non-tax purposes , their obligations for such other purposes cannot always mitigate the risk that they enable the set up and maintenance of undertakings misused for tax avoidance and evasion practices. ### (5) to ensure the proper functioning of the internal market , the proportionality and effectiveness of potential rules , it would be desirable to limit their scope to undertakings which are at risk of being found to lack minimal substance and used with the main objective of obtaining a tax advantage. it would therefore be important to establish a gateway criterion , in the form of a set of four , indicative conditions , in order to conclude which undertakings are sufficiently at risk as aforementioned to justify that they be subjected to reporting requirements. a first condition should enable the identification of undertakings presumably engaged mainly in geographically mobile economic activities , as the place where such activities are actually carried out is usually more challenging to identify. such activities normally give rise to important passive income flows. hence , undertakings , which income consists predominantly of passive income flows would meet this condition. it should also be taken into account that entities holding assets for private use , such as real estate , yachts , jets , artworks , or equity alone , may have no income for longer periods of time , but still enable significant tax benefits by way of owning those assets. as purely domestic situations would not pose a risk for the good functioning of the internal market and would be best addressed at domestic level , a second condition should focus on undertakings engaged in cross-border activities. engagement in cross-border activities should be established having regard , on the one hand , to the nature of the transactions of the undertaking , domestic or foreign , and on the other , to its property , given that entities that only hold assets for private , non-business , use may not engage in transactions for a considerable time. additionally , a third condition should point out to those undertakings which have no or inadequate own resources to perform core management activities. in this regard , undertakings that do not have adequate own resources tend to engage third party providers of administration , management , correspondence and legal compliance services or enter into relevant agreements with associated enterprises for the supply of such services in order to set up and maintain a legal and tax presence. outsourcing of certain ancillary services only , such as bookkeeping services alone , while core activities remain with the undertaking , would not suffice in itself for an undertaking to meet this condition. while such service providers might be regulated for other , non-tax purposes , their obligations for such other purposes cannot always mitigate the risk that they enable the set up and maintenance of undertakings misused for tax avoidance and evasion practices. finally , a fourth condition should look at the profitability and productivity rates at the level of the undertaking. high rates could be indicative of a lack of substance.


### (6) it would be fair to exclude from the envisaged rules undertakings whose activities are subject to an adequate level of transparency and therefore do not present a risk of lacking substance for tax purposes. companies having a transferable security admitted to trading or listed on a regulated market or multilateral trading facility as well as certain financial undertakings which are heavily regulated in the union , directly or indirectly , and subject to increased transparency requirements and supervision , should equally be excluded from the scope of this directive. pure holding undertakings which are situated in the same jurisdiction as the operational subsidiary and their beneficial owner(s) are not likely to serve the objective of obtaining a tax advantage either. similar is the case of sub-holding undertakings which are situated in the same jurisdiction as their shareholder or ultimate parent entity. on this basis , they should also be excluded. undertakings that engage an adequate number of persons , full-time and exclusively , in order to carry out their activities should equally not be considered to lack minimal substance. while they are not reasonably expected to pass the gateway criterion , they should be excluded explicitly for purposes of legal certainty. ### deleted


### (9) to ensure tax certainty , it is imperative to lay down common rules on the content of undertakings’ declarations. undertakings that pass the gateway criterion and are consequently subject to reporting requirements should be presumed not to have sufficient substance for tax purposes if they also declare not to possess one or more of the elements that cumulatively constitute a minimum level of substance , or do not provide the required supporting evidence. undertakings that declare to possess all the elements of the minimum level of substance and provide the required supporting documentation should instead be presumed to have minimal substance for tax purposes and should incur no further obligations and consequences under this directive. this , however , should be without prejudice to any applicable law and the right of the administration to perform an audit , including on the basis of the supporting documentation , and possibly , arrive at a different conclusion. ### (9) to ensure tax certainty , it is imperative to lay down common rules on the content of undertakings’ declarations. undertakings that pass the gateway criterion and are consequently subject to reporting requirements should be presumed not to have sufficient substance for tax purposes if they also declare not to possess one of the elements that cumulatively constitute a minimum level of substance , or do not provide the required supporting evidence. undertakings that declare to possess all the elements of the minimum level of substance and provide the required supporting documentation should instead be presumed to have minimal substance for tax purposes and should incur no further obligations and consequences under this directive. this , however , should be without prejudice to any applicable law and the right of the administration to perform an audit , including on the basis of the supporting documentation , and possibly , arrive at a different conclusion. to allow member states to efficiently allocate tax administration’s resources , member states may consider for a period of three years that the undertaking is presumed to have minimum substance on the condition that the factual and legal circumstances of the undertaking remain unchanged during this period.


### (10) it is recognised that whether an undertaking is actually performing economic activities for tax purposes or serves mainly tax avoidance or evasion purposes is ultimately a matter of facts and circumstances. this should be assessed on a case by case basis in respect of each specific undertaking. therefore , undertakings presumed not to have minimal substance for tax purposes should be entitled to prove the contrary , including to prove that they do not serve primarily tax objectives , and rebut such presumption. after fulfilling their reporting obligations under this directive , they should provide additional information to the administration of the member state where they reside for tax purposes. while they may provide any additional information that they deem appropriate , it is essential to set common requirements of what may constitute appropriate additional evidence and should thus be required in all cases. where the member state , based on such additional evidence , considers that an undertaking has rebutted a presumption of lack of substance in a satisfactory manner , it should be able to issue a decision to certify that the undertaking has minimal substance for tax purposes in accordance with this directive. such decision may remain valid for the period during which factual and legal circumstances of the undertaking remain unchanged and up to 6 years from the time the decision is issued. this will allow to limit the resources allocated to cases that have been evidenced not to be a shell for the purposes of the directive. ### (10) it is recognised that whether an undertaking is actually performing economic activities for tax purposes or serves mainly tax avoidance or evasion purposes is ultimately a matter of facts and circumstances. this should be assessed on a case by case basis in respect of each specific undertaking. therefore , undertakings presumed not to have minimal substance for tax purposes should be entitled to prove the contrary , including to prove that they do not serve primarily tax objectives , and rebut such presumption. after fulfilling their reporting obligations under this directive , they should provide additional information to the administration of the member state where they reside for tax purposes. while they may provide any additional information that they deem appropriate , it is essential to set common requirements of what may constitute appropriate additional evidence and should thus be required in all cases. where the member state , based on such additional evidence , considers that an undertaking has rebutted a presumption of lack of substance in a satisfactory manner , it should be able to issue a decision to certify that the undertaking has minimal substance for tax purposes in accordance with this directive. such decision may remain valid for the period during which factual and legal circumstances of the undertaking remain unchanged and up to 3 years from the time the decision is issued. this will allow to limit the resources allocated to cases that have been evidenced not to be a shell for the purposes of the directive.


### (11) as the objective of this directive is to prevent tax avoidance and evasion that are likely to flourish through actions by undertakings without minimal substance , and in order to ensure tax certainty and enhance the proper functioning of the internal market , it is paramount to provide for a possibility of exemptions for undertakings which meet the gateway criterion but yet whose interposition has no actual advantageous impact on the overall tax position of the undertaking’s group or of the beneficial owner(s). for that reason , such undertakings should be entitled to request the administration of the member state , where they reside for tax purposes , to issue a decision which exempts them from complying with the proposed rules altogether and upfront. such exemption should also be limited in time , to allow the administration to verify on a regular basis that the factual and legal circumstances justifying the exemption decision remain valid. at the same time a potential extended duration of such decision will allow to limit the resources allocated to cases that should be exempt from the scope of the directive. ### (11) as the objective of this directive is to prevent tax avoidance and evasion that are likely to flourish through actions by undertakings without minimal substance , and in order to ensure tax certainty and enhance the proper functioning of the internal market , it is paramount to provide for a possibility of exemptions for undertakings which meet the gateway criterion , but fail on only one of the minimum substance criteria , yet whose interposition has no actual advantageous impact on the overall tax position of the undertaking’s group or of the beneficial owner(s). for that reason , such undertakings should be entitled to request the administration of the member state , where they reside for tax purposes , to issue a decision which exempts them from complying with the proposed rules altogether and upfront. such exemption should also be limited in time , 3 years , to allow the administration to verify on a regular basis that the factual and legal circumstances justifying the exemption decision remain valid. at the same time a potential extended duration of such decision will allow to limit the resources allocated to cases that should be exempt from the scope of the directive.


### (13) to ensure effectiveness of the proposed framework , it is necessary to establish appropriate tax consequences for undertakings that do not have minimal substance for tax purposes. undertakings that have crossed the gateway criterion and are presumed to be lacking substance for tax purposes while , additionally , have not provided evidence to the contrary or evidence that they do not serve the objective of obtaining a tax advantage , should not be allowed to benefit from the provisions of agreements and conventions that provide for the elimination of double taxation of income , and where applicable , capital , to which the member state of their tax residence is a party and from any other agreements , including provisions in international agreements for the promotion and protection of investments , with equivalent purpose or effect. such undertakings should not be allowed to benefit from council directive 2011/96/eu14 and council directive 2003/49/ec15. to this effect , those undertakings should not be entitled to a certificate of tax residence to the extent that this serves to obtain those benefits. the member state where the undertaking is resident for tax purposes should therefore deny to issue a certificate of tax residence. alternatively , that member state should be able to issue such certificate while indicating , by means of a warning , that it should not be used by the undertaking to obtain tax benefits as above. this denial of a certificate of tax residence , or alternatively the issue of a special certificate of tax residence , should not set aside the national rules of the member state of the undertaking with regard to the tax residence and relevant obligations linked thereto. it would rather serve to communicate to other member states , and third countries , that no relief or refund should be granted with regard to transactions involving this undertaking based on any treaty with the member state of the undertaking or union directives , if applicable. ### (13) to ensure effectiveness of the proposed framework , it is necessary to establish appropriate tax consequences for undertakings that do not have minimal substance for tax purposes. undertakings that have crossed the gateway criterion and are presumed to be lacking substance for tax purposes while , additionally , have not provided evidence to the contrary or evidence that they do not serve the objective of obtaining a tax advantage , should not be allowed to benefit from the provisions of agreements and conventions that provide for the elimination of double taxation of income , and where applicable , capital , to which the member state of their tax residence is a party and from any other agreements , including provisions in international agreements for the promotion and protection of investments , with equivalent purpose or effect. such undertakings should not be allowed to benefit from council directive 2011/96/eu14 and council directive 2003/49/ec15. to this effect , those undertakings should not be entitled to a certificate of tax residence to the extent that this serves to obtain those benefits. the member state where the undertaking is resident for tax purposes should therefore deny to issue a certificate of tax residence and issue a statement regarding the grounds on which the decision was based. this denial of a certificate of tax residence should not set aside the national rules of the member state of the undertaking with regard to the tax residence and relevant obligations linked thereto. it would rather serve to communicate to other member states , and third countries , that no relief or refund should be granted with regard to transactions involving this undertaking based on any treaty with the member state of the undertaking or union directives , if applicable.


### (16) in order to improve effectiveness , member states should lay down penalties against the violation of the national rules that transpose this directive. such penalties should be effective , proportionate and dissuasive. to ensure tax certainty and a minimum level of coordination across all member states , it is necessary to fix a minimum monetary penalty , also taking into account the situation of each specific undertaking. the envisaged rules rely on self-assessment by the undertakings as regards whether or not they meet the gateway criteria. to achieve effectiveness of the provisions , incentivising adequate compliance across the union , and taking into account that a shell undertaking in one member state may be used to erode the tax base of another member state , it is important that any member state has the right to request another member state to conduct tax audits of undertakings at risk for not fulfilling minimum substance as defined in this directive. accordingly , to reinforce effectiveness , it is essential that the requested member state has an obligation to carry out such audit and to share information on the outcome , even where there is no finding of ‘shell’ entity. ### (16) in order to improve effectiveness , member states should lay down penalties against the violation of the national rules that transpose this directive. such penalties should be effective , proportionate and dissuasive. to ensure tax certainty and a minimum level of coordination across all member states , it is necessary to fix a minimum monetary penalty , also taking into account the situation of each specific undertaking. the envisaged rules rely on self-assessment by the undertakings as regards whether or not they meet the gateway criteria. to achieve effectiveness of the provisions , incentivising adequate compliance across the union , and taking into account that a shell undertaking in one member state may be used to erode the tax base of another member state , it is important that any member state has the right to request another member state to conduct joint tax audits of undertakings at risk for not fulfilling minimum substance as defined in this directive. accordingly , to reinforce effectiveness , it is essential that the requested member state has an obligation to carry out such audit and to share information on the outcome , even where there is no finding of ‘shell’ entity.


### (5) ‘beneficial owner’ means beneficial owner as defined in article 3 , point (6) , of directive (eu) 2015/849 of the european parliament and of the council; ### (5) ‘beneficial owner’ means any natural person owning directly or indirectly at least one share of the undertaking (or the equivalent minimum unit of interest in a legal person);


### 1. member states shall require that undertakings meeting the following criteria to report to the competent authorities of member states in accordance with article 7: ### 1. member states shall require that undertakings meeting at least two of the following criteria to report to the competent authorities of member states in accordance with article 7:


### more than 75% of the revenues accruing to the undertaking in the preceding two tax years is relevant income; ### more than 50% of the revenues accruing to the undertaking in the preceding two tax years is relevant income;


### more than 60% of the book value of the undertaking’s assets that fall within the scope of article 4 , points (e) and (f) , was located outside the member state of the undertaking in the preceding two tax years; ### more than 50% of the book value of the undertaking’s assets that fall within the scope of article 4 , points (e) and (f) , was located outside the member state of the undertaking in the preceding two tax years;


### (ii) at least 60% of the undertaking’s relevant income is earned or paid out via cross-border transactions; ### (ii) at least 50% of the undertaking’s relevant income is earned or paid out via cross-border transactions;


### an undertaking which holds assets that can generate income falling within the scope of article 4 , points (e) and (f) , shall also be deemed to meet the criterion set out in point (a) of the first subparagraph , irrespective of whether income from these assets has accrued to the undertaking in the preceding two tax years , if the book value of these assets is more than 75% of the total book value of the undertaking’s assets. ### an undertaking which holds assets that can generate income falling within the scope of article 4 , points (e) and (f) , shall also be deemed to meet the criterion set out in point (a) of the first subparagraph , irrespective of whether income from these assets has accrued to the undertaking in the preceding two tax years , if the book value of these assets is more than 50% of the total book value of the undertaking’s assets.


### an undertaking which holds assets that can generate income falling within the scope of article 4 , point (c) , shall also be deemed to meet the criterion set out in point (a) of the first subparagraph , irrespective of whether income from these assets has accrued to the undertaking in the preceding two tax years , if the book value of these assets is more than 75% of the total book value of the assets of the undertaking. ### an undertaking which holds assets that can generate income falling within the scope of article 4 , point (c) , shall also be deemed to meet the criterion set out in point (a) of the first subparagraph , irrespective of whether income from these assets has accrued to the undertaking in the preceding two tax years , if the book value of these assets is more than 50% of the total book value of the assets of the undertaking.


### regulated financial undertakings; ### deleted


### undertakings with at least five own full-time equivalent employees or members of staff exclusively carrying out the activities generating the relevant income; ### deleted


### [...] ### deleted


### one of the following indicators: ### the following indicators:


### (ii) the majority of the full-time equivalent employees of the undertaking are resident for tax purposes in the member state of the undertaking , or at no greater distance from that member states insofar as such distance is compatible with the proper performance of their duties , and such employees are qualified to carry out the activities that generate relevant income for the undertaking. ### (ii) the majority of the full-time equivalent employees of the undertaking have their habitual place of work as defined by regulation (ec) no 593/2008 in the member state of the undertaking and such employees are qualified to carry out the activities that generate relevant income for the undertaking.


### 4. after the end of the tax year for which the undertaking rebutted the presumption successfully , inaccordance with paragraph 3 , a member state may consider for a period of five years that the undertaking has rebutted the presumption on the condition that the factual and legal circumstances of the undertaking remain unchanged during this period. ### 4. after the end of the tax year for which the undertaking rebutted the presumption successfully , in accordance with paragraph 3 , a member state may consider for a period of three years that the undertaking has rebutted the presumption on the condition that the factual and legal circumstances of the undertaking remain unchanged during this period.


### 1. a member state shall take the appropriate measures to allow an undertaking that meets the criteria laid down in article 6(1) to request an exemption from its obligations under this directive if the existence of the undertaking does not reduce the tax liability of its beneficial owner(s) or of the group , as a whole , of which the undertaking is a member. ### 1. a member state shall take the appropriate measures to allow an undertaking that does not meet one of the minimum substance indicators laid down in article 7 to request an exemption from its obligations under this directive if the existence of the undertaking does not reduce the tax liability of its beneficial owner(s) or of the group , as a whole , of which the undertaking is a member.


### 3. after the end of the tax year for which an exemption was granted in accordance with paragraph 2 , a member state may extend the validity of the exemption for five years on the condition that the factual and legal circumstances of the undertaking , including of the beneficial owner(s) and the group , as the case may be , remain unchanged in the relevant period. ### 3. after the end of the tax year for which an exemption was granted in accordance with paragraph 2 , a member state may extend the validity of the exemption for three years on the condition that the factual and legal circumstances of the undertaking , including of the beneficial owner(s) and the group , as the case may be , remain unchanged in the relevant period.


### 2. the member state of the undertaking’s shareholder(s) shall tax the relevant income of the undertaking in accordance with its national law as if it had directly accrued to the undertaking’s shareholder(s) and deduct any tax paid on such income at the member state of the undertaking , where the following conditions are met: ### 2. the member state of the undertaking’s shareholder(s) shall tax the relevant income or assets of the undertaking in accordance with its national law as if it had directly accrued to the undertaking’s shareholder(s) and deduct any tax paid on such income at the member state of the undertaking , where the following conditions are met:


### where the payer is not resident for tax purposes in a member state , the member state of the undertaking’s shareholder(s) shall tax the relevant income accruing to the undertaking in accordance with its national law as if it had directly accrued to the undertaking’s shareholder(s) , without prejudice to any agreement or convention that provides for the elimination of double taxation of income , and where applicable , capital , in force between the member state of the undertaking’s shareholders and the third country jurisdiction of the payer; ### where the payer is not resident for tax purposes in a member state , the member state of the undertaking’s shareholder(s) shall tax the relevant income or assets accruing to the undertaking in accordance with its national law as if it had directly accrued to the undertaking’s shareholder(s) , without prejudice to any agreement or convention that provides for the elimination of double taxation of income , and where applicable , capital , in force between the member state of the undertaking’s shareholders and the third country jurisdiction of the payer;


### where an undertaking does not have minimum substance for tax purposes in the member state where it is resident for tax purposes , that member state shall take any of the following decisions: ### where an undertaking does not have minimum substance for tax purposes in the member state where it is resident for tax purposes , that member state shall deny any request for a certificate of tax residence to the undertaking for use outside the jurisdiction of this member state:


### deny a request for a certificate of tax residence to the undertaking for use outside the jurisdiction of this member state; ### deleted


### grant a certificate of tax residence which prescribes that the undertaking is not entitled to the benefits of agreements and conventions that provide for the elimination of double taxation of income , and where applicable , capital , and of international agreements with a similar purpose or effect and of articles 4 , 5 and 6 of directive 2011/96/eu and article 1 of directive 2003/49/ec. ### deleted


### member states shall ensure that those penalties include an administrative pecuniary sanction of at least 5% of the undertaking’s turnover in the relevant tax year , if the undertaking that is required to report pursuant to article 6 does not comply with such requirement for a tax year within the prescribed deadline or makes a false declaration in the tax return under article 7. ### member states shall ensure that those penalties include an administrative pecuniary sanction of at least 5% of the undertaking’s turnover in the relevant tax year , if the undertaking that is required to report pursuant to article 6 does not comply with such requirement for a tax year within the prescribed deadline or makes a false declaration in the tax return under article 7. in case of zero or low turnover , defined as below 1 million eur , the penalty should be based on the undertaking’s total assets.


### where the competent authority of one member state has reason to believe that an undertaking which is resident for tax purposes in another member state has not met its obligations under this directive , the former member state may request the competent authority of the latter to conduct a tax audit of the undertaking. ### where the competent authority of one member state has reason to believe that an undertaking which is resident for tax purposes in another member state has not met its obligations under this directive , the former member state may request the competent authority of the latter to conduct a joint tax audit of the undertaking based on article 12a of council directive (eu) 2021/514.


### the competent authority of the requested member state shall initiate it within one month from the date of receipt of the request and conduct the tax audit , in accordance with the rules governing tax audits in the requested member state. ### if the requesting competent authority cannot conduct a joint tax audit for legal reasons , the competent authority of the requested member state shall initiate an audit within one month from the date of receipt of the request and conduct it , in accordance with the rules governing tax audits in the requested member state.


### number of audits to undertakings that meet the conditions laid down in article 6(1) , ### number of audits and joint audits to undertakings that meet the conditions laid down in article 6(1) ,


### 1. by 31 december 2028 , the commission shall present a report to the european parliament and the council on the implementation of this directive. ### 1. every three years from the entry into force of this directive , the commission shall present a report to the european parliament and the council on the implementation of this directive.


### 2. when drawing up the report , the commission shall take into account the information communicated by the member states pursuant to article 15. ### 2. when drawing up the report , the commission shall take into account the information communicated by the member states pursuant to article 16.


### a. whereas the banking union (bu) currently consists of the single supervisory mechanism (ssm) and the single resolution mechanism (srm); ### a. whereas the banking union (bu) remains incomplete as long as it lacks a european deposit insurance scheme (edis);


### e. whereas the role of the banking sector is crucial to the recovery and transition to a low-carbon economy; ### e. whereas the role of the banking sector is crucial to the recovery and transition to a carbon neutral economy , in line with the objectives of the paris agreement and the european green deal;


### g. whereas there is a need for effective anti-money laundering supervision; ### g. whereas prudential and anti-money laundering supervision is necessary and should be further strengthened;


### 2. considers that the bu should be built in a friendly and attractive way , including for member states outside the euro area; ### 2. considers that a complete and deeply integrated banking union would benefit all members of the banking union , while incentivising the accession of member states outside the euro area;


### 4. recalls the key role of the eu banking sector in financing the recovery of the european economy; ### 4. recalls the key role of the eu banking sector in financing the recovery , resilience , and twin transition of the european economy;


### 5. notes that the eba , the ecb and the srb still see many problems in the banking system , such as high stocks of non-performing loans (npls) , exposures to sectors which are sensitive to the covid-19 crisis , deficiencies in risk management , and discrepancies in the implementation of international financial reporting standard 9 (ifrs 9); underlines with concern that these problems are likely to increase after the withdrawal of the emergency measures; ### 5. notes that the eba , the ecb and the srb still see many problems in the banking system , such as high stocks of non-performing loans (npls) , exposures to sectors which are sensitive to the covid-19 crisis , deficiencies in risk management , and discrepancies in the implementation of international financial reporting standard 9 (ifrs 9); underlines with concern that these problems are likely to increase after the withdrawal of the emergency measures , such as payment moratoria and public guarantee schemes;


### 6. supports ongoing work on the implementation of the basel iii rules; ### 6. supports ongoing work on the implementation of the basel iii rules; stresses that the crr and crd review should fully reflect basel iii standards; emphasises that any consideration of eu banks' specificities shall be very limited and should not water down the new requirements on output floor , credit and operational risk; calls for the reflection of banks exposures to stranded assets in the capital requirements;


### 12. notes that the transition to a low-carbon economy presents new challenges and risks related to the preference for sustainable investments; stresses the need for an in-depth analysis of the economic efficiency of sustainable investments in order to avoid a future bubble of green assets; calls for clear guidelines for banks based on economic data; ### deleted


### 14. draws attention to the dangers of a very loose monetary policy stimulating inflation; points out the need for the gradual tightening of monetary policy; ### deleted


### 16. notes the problems and challenges related to home/host issues; points out that greater market integration requires credible safeguards in eu law for host member states; ### 16. notes the problems and challenges related to home/host issues; considers that the home/host tension will not be allayed until the european risk sharing architecture has been completed and sees the establishment of a fully-fledged edis as an integral part of the solution; further calls for a better inclusion of 'local risk' into the group’s requirements that would reduce the need to 'ring-fence' , a review of the srm governance to accommodate voting modalities with a more direct involvement of both host and home authorities , and harmonisation of insolvency law to facilitate resolution-planning for cross-border banking groups within the banking union;


### 17. stresses the need for effective anti-money laundering supervision; notes the commission’s adoption of the anti-money laundering (aml) package of proposals; ### 17. stresses the need for effective anti-money laundering supervision; welcomes the commission’s adoption of the anti-money laundering (aml) package of proposals , in particular the establishment of an eu anti-money laundering authority and the transfer of parts of the aml directive into a regulation;


### 20. supports the specification of the public interest assessment criteria so that the srm is applied in a more consistent and predictable manner; proposes that an alternative liquidation regime for small and medium-sized banks be considered; asks for a more proportionate setting of the minimum requirement for own funds and eligible liabilities (mrel) level; ### 20. supports the specification of the public interest assessment criteria so that the srm is applied in a more consistent and predictable manner;


### 22. recalls that the ssm and the srm operate at eu level , while deposit guarantee schemes (dgss) are operated at national level; recognises that a european deposit insurance scheme (edis) would improve protection for depositors in the eu; ### 22. recalls that the ssm and the srm operate at eu level , while deposit guarantee schemes (dgss) are operated at national level; is deeply concerned that the banking union still lacks its third pillar , namely a robust european deposit insurance scheme (edis) that would improve protection for depositors wherever their bank is located in the eu and significantly reduce the negative link between banks and their home sovereign; stresses that a complete , harmonised , integrated banking industry would also support the single market;


### 23. notes the ongoing discussion of various concepts for the edis; ### 23. notes the ongoing discussion of various concepts for the edis; takes the view that a fully-fledged model of edis should remain the ultimate goal;


### 24. considers that the main obstacles for edis are concerns about risks in some banking systems; stresses that the implementation of credible and effective risk reduction measures could enable an agreement on edis; ### 24. considers that the main obstacles for edis are concerns about risks in some banking systems;


### without prejudice to the penalty mechanism referred to in paragraph 2 of this article and the right to bilaterally cancel the transaction , the commission may , by means of an implementing act , decide to which of the financial instruments referred to in article 5(1) or categories of transactions in those financial instruments the settlement discipline measures referred to in paragraphs 3 to 8 of this article are to be applied where the commission considers that those measures constitute a proportionate means to address the level of settlement fails in the union and that , based on the number and volume of settlement fails , any of the following conditions is met: ### by ... [12 months after the date of entry into force of this regulation] the commission shall , after consulting esma , assess the impact of cash penalties and reporting requirements on achieving appropriate levels of settlement efficiency in the union and on the reduction of settlement fails in the union as well as the appropriateness and proportionality of mandatory buy-in measures to address the level of settlement fails in the union , and report to the european parliament and to the council. within 6 months of that assessment , the commission shall adopt delegated acts in accordance with article 67 to supplement this regulation by determining for which of the financial instruments referred to in article 5(1) or categories of transactions in those financial instruments the settlement discipline measures referred to in paragraphs 3 to 8 of this article are to be applied , where the assessment referred to in the first subparagraph concludes that those measures constitute a proportionate means to address the level of settlement fails in the union and that , based on the number and volume of settlement fails , any of the following conditions is met:


### where the commission has adopted an implementing act pursuant to paragraph 2a and where a failing participant has not delivered financial instruments covered by that implementing act to the receiving participant within a period after the intended settlement date (‘extension period’) equal to 4 business days , a buy-in process shall be initiated whereby those instruments shall be available for settlement and delivered to the receiving participant within an appropriate timeframe. ### without prejudice to the penalty mechanism referred to in paragraph 2 of this article and the right to bilaterally cancel the transaction , where the commission has adopted an implementing act pursuant to paragraph 2a and where a failing participant has not delivered financial instruments covered by that implementing act to the receiving participant within a period after the intended settlement date (‘extension period’) equal to 4 business days , a buy-in process shall be initiated whereby those instruments shall be available for settlement and delivered to the receiving participant within an appropriate timeframe.


### 14a. the commission may adopt delegated acts in accordance with article 67 to supplement this regulation specifying the reasons for settlement fails that are to be considered as not attributable to the participants to the transaction and the transactions that are not to be considered to involve two trading parties under paragraph 2 and paragraph 4 , points (c) and (d) , of this article.; ### 14a. after consulting esma , the commission shall adopt delegated acts in accordance with article 67 to supplement this regulation specifying the reasons for settlement fails that are to be considered as not attributable to the participants to the transaction and the transactions that are not to be considered to involve two trading parties under paragraph 2 and paragraph 4 , points (c) and (d) , of this article.;


### the competent authority of the home member state may transmit to esma any information received from the csds during or in relation to on-site inspections.; ### the competent authority of the home member state shall transmit to esma any relevant information received from the csds during or in relation to on-site inspections.;


### colleges of supervisors shall be established to carry out the tasks referred to in paragraph 6 in the following cases: ### where a csd is of substantial importance in more than one host member state or where a csd is part of a group that comprises two or more csds authorised in at least two member states esma shall establish , manage and chair a college of supervisors.


### in the case referred to in the first subparagraph , point (a) , the csd’s home competent authority shall establish , manage and chair the passporting college. that college shall be established within 1 month from the date referred to in article 23(6). where the csd submits subsequent notifications pursuant to article 23(3) , the competent authority of the home member state shall invite the competent authorities of the relevant host member states to the passporting college within 1 month from the date referred to in article 23(6). ### deleted


### in the case referred to in the first subparagraph , point (b) , where the parent undertaking is a csd authorised in the union , the competent authority of the home member state of that csd shall establish , manage and chair the group-level college. where the parent undertaking is not a csd authorised in the union , the competent authority of the home member state of the csd with the largest balance sheet total shall establish , manage and chair the group-level college. ### deleted


### by way of derogation from the third subparagraph , where the application of the criteria referred to in that subparagraph would be inappropriate , the competent authorities may waive by common agreement those criteria and appoint a different csd’s competent authority to manage and chair the college , taking into account the csds concerned and the relative importance of their activities in the relevant member states. in such cases , the parent csd or the csd with the largest balance sheet total , as applicable , shall have the right to be heard before the competent authorities take the decision. ### deleted


### the competent authorities shall notify the commission and esma without delay of any agreement made pursuant to the fourth subparagraph. ### deleted


### esma; ### esma , as the chair of the college;


### in the case of a passporting college , the competent authority of the host member states; ### the competent authority of the host member states where the csd is of substantial importance;


### in the case of a group-level college , the competent authority and the relevant authorities of each csd in the group; ### in the case of a group of csds , the competent authority and the relevant authorities of each csd in the group;


### in the case of a passporting college , the cooperation of the home and host member state pursuant to article 24 and regarding the measures referred to in article 23(4) , point (e) and on any issues encountered in the provision of services in other member states; ### the cooperation of the home and host member state pursuant to article 24 and regarding the measures referred to in article 23(4) ,point (e) or any breach of the requirements laid down in this regulation arising from the provision of services in a host member state referred to in article 24(5) and on any issues encountered in the provision of services in other member states;


### the competent authority shall monitor at least once per year that the threshold referred to in the first subparagraph is respected and report its findings to esma , escb and eba. where the competent authority determines that the threshold has been exceeded , it shall require the csd concerned to seek authorisation in accordance with paragraph 4. the csd concerned shall submit its application for authorisation within 6 months.; ### esma shall monitor at least once per year that the threshold referred to in the first subparagraph is respected and report its findings to the competent authority , escb and eba. where esma determines that the threshold has been exceeded , the competent authority shall require the csd concerned to seek authorisation in accordance with paragraph 4. the csd concerned shall submit its application for authorisation within 6 months.;


### … [po please insert the date = 3 years after the date of entry into force of this regulation]. ### … [po please insert the date = 1 year after the date of entry into force of this regulation].


### a third-country csd that provides the core services referred to in section a , points (1) and (2) , of the annex in relation to financial instruments constituted under the law of a member state referred to in article 49(1) , second subparagraph pursuant to the applicable national rules on the recognition of third-country csds shall submit a notification to esma within 2 years from [po please insert the date of entry into force of this regulation]. ### a third-country csd that provides the core services referred to in section a , points (1) and (2) , of the annex in relation to financial instruments constituted under the law of a member state referred to in article 49(1) , second subparagraph pursuant to the applicable national rules on the recognition of third-country csds shall submit a notification to esma within one year from ... [po please insert the date of entry into force of this regulation].


### 4b. a third-country csd that provided the core service referred to in section a , point (3) , of the annex in relation to financial instruments constituted under the law of a member state referred to in article 49(1) , before … [po please enter the date of entry into force of this regulation] shall submit the notification referred to in article 25(2a) within 2 years from …[po please insert the date of entry into force of this regulation]. ### 4b. a third-country csd that provided the core service referred to in section a , point (3) , of the annex in relation to financial instruments constituted under the law of a member state referred to in article 49(1) , before … [po please enter the date of entry into force of this regulation] shall submit the notification referred to in article 25(2a) within one year from …[po please insert the date of entry into force of this regulation].


### (3) regulation (eu) no 600/2014 was amended by regulation (eu) xx/xxxx of the european parliament and of the council19 removing the main obstacles that have prevented the emergence of a consolidated tape. that regulation therefore introduced mandatory contributions of market data to the consolidated tape provider and enhanced the data quality including harmonizing the synchronisation of the business clock. in addition , that regulation reduced the recourse to possibilities to waive pre-trade transparency for venues and systematic internalisers. furthermore , it introduced enhancements to the trading obligations and the prohibition of the practice of receiving payment for forwarding client orders for execution. since directive 2014/65 also contains provisions related to consolidated tape and transparency , the amendments to regulation (eu) no 600/2014 should be reflected in directive 2014/65/eu. ### (3) regulation (eu) no 600/2014 was amended by regulation (eu) xx/xxxx of the european parliament and of the council19 removing the main obstacles that have prevented the emergence of a consolidated tape. that regulation therefore introduced mandatory contributions of market data to the consolidated tape provider and enhanced the data quality including harmonizing the synchronisation of the business clock. in addition , that regulation reduced the recourse to possibilities to waive pre-trade transparency for venues and systematic internalisers. furthermore , it introduced enhancements to the trading obligations and to the best execution requirements for financial intermediaries dealing with retail client orders. since directive 2014/65 also contains provisions related to consolidated tape and transparency , the amendments to regulation (eu) no 600/2014 should be reflected in directive 2014/65/eu.


### (10) within the framework regulating the union’s markets in financial instruments , many substantive requirements laid down in regulation (eu) no 600/2014 are supervised and sanctioned at national level and in accordance with articles 69 and 70 of directive 2014/65/eu. regulation (eu) xx/xxxx24 has amended regulation (eu) no 600/2014 to include new rules on the volume cap mechanism , on mandatory contributions of core market data to the consolidate tape , on data quality standards to which those contributions are subject and on the ban on receiving payments for forwarding client orders for execution. as the supervision of the relevant entities lies with national authorities , those new substantive requirements should be added to the list in directive 2014/65/eu of provisions for which the member states should provide sanctions at national level , ### (10) within the framework regulating the union’s markets in financial instruments , many substantive requirements laid down in regulation (eu) no 600/2014 are supervised and sanctioned at national level and in accordance with articles 69 and 70 of directive 2014/65/eu. regulation (eu) xx/xxxx24 has amended regulation (eu) no 600/2014 to include new rules on the volume cap mechanism , on mandatory contributions of core market data to the consolidated tape , on data quality standards to which those contributions are subject and on requirements to financial entities to act in the best interest of their retail clients. as the supervision of the relevant entities lies with national authorities , those new substantive requirements should be added to the list in directive 2014/65/eu of provisions for which the member states should provide sanctions at national level.


### 2. in article 2(1) , point (d) , point (ii) is replaced by the following: ### 2. article 2(1) is amended as follows:


### a. whereas the use of new technologies in the eu single market and the digitalisation of tax administrations across europe is transforming relations between citizens and companies , as taxpayers , along with national tax authorities , are facilitating better compliance; ### a. whereas the use of new technologies in the eu single market and the digitalisation of tax administrations across europe can facilitate better compliance and transform relations between taxpayers , citizens and companies , with national tax authorities; whereas the eu could play a leading role in ensuring that the procedural and technical aspects of the digitalisation of tax administrations are coordinated to avoid barriers to interoperability of national technical platforms;


### b. whereas tax authorities face many challenges nowadays regarding effective cross-border cooperation , given the acceleration of digital transactions , the increasing mobility of taxpayers , the number of cross-border transactions and the internationalisation of economic operations and business models; ### b. whereas tax authorities face many challenges nowadays regarding effective tax enforcement and most in particular cross-border cooperation , given the acceleration of digital transactions , the increasing mobility of taxpayers , the number of cross-border transactions and the internationalisation of economic operations and business models;


### c. whereas tax authorities need to keep up with potential risks for the sustainability of tax systems and their ability to enforce national and european legal frameworks regarding taxation; ### c. whereas tax authorities need to be provided with the tools and means to enforce national and european legal frameworks regarding taxation;


### d. whereas new technological solutions , such as blockchain , can be used by tax administrations to better serve the needs of tax payers while such technologies can also be abused and serve as a vehicle for illicit activities , with the criminal intent to avoid paying taxes; ### d. whereas new technological solutions , such as blockchain , can be used by tax administrations to collect revenues more effectively , also from those more mobile taxpayers and lower the administrative burden for all taxpayers , while such technologies can also be abused and serve as a vehicle for illicit activities , with the criminal intent to avoid paying taxes; whereas achieving policy objectives in a digitalising world and a more economically integrated internal market will require the harmonisation of technical infrastructure;