Friend or Foe? – How Should MNEs Position Themselves in View of Amount B?

It is uncertain at this point in time which countries will implement Amount B in their domestic tax regulations, and if so, in which form or to which extent, and as of 2025 or in subsequent years. Nonetheless, it seems advisable for MNEs to assess the potential outcomes and impact of this new formulary cross-border profit allocation measure with a view to their affiliates performing baseline (i.e., routine) marketing and distribution functions in countries, in advance or even regardless of any (potential) local application of Amount B. The author expects that Amount B, whether implemented or not, will be used as a reference point for discussion between tax authorities and corporate taxpayers over time and will also entail further transparency requirements imposed on MNEs to provide segmented financials for different functions, risks and assets in their affiliates on a regular basis.