The British Virgin Islands (BVI) has launched a private sector consultation on the impact of implementing the OECD’s proposals on country-by-country reporting.

Country-by-country reporting is a key element of the OECD/G20’s base erosion and profit shifting (BEPS) Action Plan and, if implemented in the territory, would require multinational enterprises incorporated in the BVI with annual group revenues of EUR750m (USD837m) or more to file a detailed return annually with the territory’s tax authorities.

This return would automatically be shared between countries signed up to the BEPS initiative to provide greater transparency on the tax affairs of companies operating across borders.

The BVI Government said the consultation is intended to develop its “understanding of the impact of country-by-country reporting in the BVI and assess how the territory’s private sector defines economic substance providing the BVI Government with greater clarity on the future opportunities this may create for the territory.”

As part of the consultation, the BVI Government is asking for views on the issue of “economic substance,” with BEPS measures being proposed to ensure that the right amount of tax is paid where economic activity takes place.

Lorna Smith of BVI Finance, the territory’s financial services promotion agency, said: “We recognize the importance of international collaboration between jurisdictions to ensure that the global tax system remains robust and effective and we welcome the OECD’s work in this area.”

“We pride ourselves on our track record of engaging stakeholders in the private sector and to ensuring that our regulatory framework is fully supportive of their needs. We look forward to receiving responses to our consultation and to further progressing our work on this important international initiative.”

Responses are requested by September 16, 2016.