The globalization of the economy, as observed through the proliferation of multinational corporations,
has led states to define policies that can enable effective control of prices of intercompany transactions
in order to better combat tax evasion and fraud. The recent 2024 Cameroon’s finance law illustrates
this sufficiently through a major innovation in transfer pricing documentation, known as country-by-
country report. It requires to provide the tax administration with a set of information on the accounting
and tax results of multinational enterprises in each jurisdiction in which they operate. Constituting the
third element of transfer pricing documentation according to the standardized approach defined by
Action 13 of the OECD Action Plan, this report thereby complements the Cameroonian legal
framework for transfer pricing documentation, which until now has been incomplete due to its
nonexistence. This contributes to making transfer pricing policy more effective as an instrument to
combat fraudulent transfer of profits within multinational groups. Introduced by Section 18c of the
GTC, the country-by-country report is an obligation imposed on certain companies established in
Cameroon under well-defined conditions. The 2024 finance law specifies in paragraphs 6 and 8 of the
aforementioned Section 18c that the content, as well as the list of states that have concluded an
agreement with Cameroon authorizing the automatic exchange of country-by-country report, will be
established by orders of the Minister in charge of finance. While awaiting the determination of the
content of this obligation, the Cameroonian legislature has regulated its scope. Therefore, it appears
appropriate to question the domain of the country-by-country report obligation in Cameroon. The
answer to this question leads us to distinguish between companies subject to this obligation (I) and
those exempted from it (II).
I. Companies subject to the country-by-country report
The Reading of Section 18c of the GTC reveals that a company established in Cameroon may be
subject to country-by-country report either when it directly or indirectly owns shares in one or more
enterprises, or conversely when it is owned in the same conditions by companies established in other
states. In the first case, the Cameroonian company is subject to country-by-country report under three
conditions. Firstly, its equity investments result in the obligation to prepare consolidated financial
statements in accordance with the applicable accounting legislation, or should result in the preparation
of such financial statements if those interests were listed on the Central African Stock Exchange
(BVMAC). Secondly, it must achieve a consolidated turnover, excluding taxes, equal to or exceeding
492,000,000,000 XAF for the previous fiscal year to which the report relates to. Lastly, no other
company should own shares in the company concerned in such a way that it is compelled to prepare
consolidated financial statements. In the second case, paragraphs 2 and 3 of the aforementioned
Section 18c state that a Cameroonian company directly or indirectly owned by a foreign company is
subject to country-by-country report when the company owning it meets one of the three non-
cumulative conditions provided by the law. Primarily, the foreign company in question must be
established in a country that does not require the filing of this declaration but would be required to do
so if it were in Cameroon. Further, it must be established in a country that is not on the list of states
with automatic exchange of country-by-country report with Cameroon but has concluded an
agreement for the exchange of tax information. Finally, when it is established in the state on the list of
states with automatic exchange of country-by-country report agreement with Cameroon, the
Cameroonian administration must have been informed of a systemic failure in its state of tax
residence. Such failure must have prevented the automatic exchange of country-by-country report.
Companies subject to this reporting obligation must file it within 12 months after the close of the fiscal
year and electronically, using a format established by the tax administration. Failure to file or filing an
incomplete or inaccurate declaration is subject to penalties provided for in Section 18c paragraph 9
and L 104 of the Manual of Tax Procedures, including a fixed fine of 50,000,000 XAF. However, it
remains that certain companies, although established in Cameroon, are exempted from this country-
by-country report filing obligation.
II. Companies Exempted From The Country-By-Country Report
Although established in Cameroon, some companies are exempt from the requirement to file the
country-by-country report. Indeed, paragraph 4 of Section 18c of the GTC states that when the
company established in Cameroon is not the ultimate parent company of the multinational group of
enterprises, it is not required to fulfil this obligation for a fiscal year in the event of a substitute filing
in another jurisdiction by the multinational group of companies. However, this exemption is subject to
six cumulative conditions all related to the Tax jurisdiction of the reporting entity. In fact, the
exemption is only granted if the said tax residence jurisdiction of the reporting company requires the
filing of a country-by-country declaration similar to that of Cameroon; has concluded an agreement
authorizing the automatic exchange of country-by-country report with Cameroon in effect on the date
scheduled for filing the report; has not informed Cameroon of any systemic failure; has exchanged the
country-by-country report with Cameroon and has been informed by the resident reporting entity for
tax purposes in its jurisdiction that the latter has been designated by the multinational group of
companies to file the country-by-country report on its behalf. In addition to these five conditions, the
law also provides that a notification from the resident reporting entity for tax purposes in Cameroon
must have been received by the tax administration, indicating the identity and tax residence
jurisdiction of the reporting entity. It goes without saying that when the company established in
Cameroon happens to be the ultimate parent entity of the group and no substitute filing has been made
in another jurisdiction, it will be required to file the country-by-country declaration if any of the
above-mentioned conditions are not met, under penalties.
In conclusion, the country-by-country declaration appears as a new obligation conferred upon
companies established in Cameroon, depending on whether they are direct or indirect owners of other
companies; or whether they belong to foreign entities. However, it is important to note that some
enterprises are exempted from declarative duties, subject to multiple cumulative conditions. If the
content of the declaration is yet to be determined by the ministry of finance’s order, the disregard of
these obligations can lead to heavy fiscal sanctions.
Author: Yannick Ndoum, Tax & Legal Consultant; Supervisor: Albert Désiré Zang, Managing
Partner