Aren’t we lucky? Two stumps in one day!

It’s the Americans, the bastards!

For all these reasons to pretend that there is any legal reason that prevents the publication of country-by-country data should candidly be bluntly dismissed as straightforwardly untrue. Instead what my sources tell me is that the suggestion has been made in this form to appease the USA.

In the USA the inclusion of country-by-country reporting data in tax returns is seen as a European imposition on US companies even though it is actually an OECD issue. It is massively resented by the Republicans and is only being implemented because it has been argued that it is a mere administrative reform to tax returns not requiring legislation for approval, which would be blocked if it was proposed, like most things of any value are in the US these days. But, in a compromise the IRS thinks it has to make to get the data I understand that they have told the EU that they believe that the OECD stipulation that the data be unpublished is binding and that if any country or countries publish data for jurisdictions other than their own then they will not share data the US receives on CBCR with them. Apparently they accept the EU as one administration for this purpose.

So, the threat of legal action is from the U.S. here and the issue arises because the OECD rules do not require that a group of companies submit its country-by-country report to all the countries in which it trades but only to the tax authority of its parent company, which is then legally bound to share it, which is what it looks like the US is refusing to do. The consequence is that the US can hold the EU to ransom as a result.

It’s not the Americans, the bastards, it’s the companies, the bastards!

The EU has said of country-by-country reporting that to demand publication of data for all the jurisdictions in which a multinational company trades could lead it into a legal minefield.

Now, of course one has to be cautious about an excuse offered by an unnamed official to a journalist on a document that may, or may not, have been officially leaked. The claim may not be true, if course, and may just look usefully convenient when the political will to act does not exist.

But suppose for a moment that the claim is true. Suppose that the EU – the largest supra-national legislator in the world – thinks it cannot legislate because of a legal minefield. Who created that minefield? What is the risk? And why can’t it be cleared?

I have already dealt with the likelihood that the USA is the real risk and it’s not threatening legal action: blackmail is more its line. So the risk cannot be from there, and it cannot be from EU member states, so it must come from companies.

The clear implication of this is unpalatable. As many of us have feared to be the inevitable direction of trade deals and agreements, the EU may now be signalling that it can only regulate companies to the extent that they concur with its wishes, and if they do not then the EU is recognising that the threat of legal action may be real.

In other words the rule of law is now conditional on the consent of those supposedly subject to it.

Corporate law may, then, be prevailing.

This is the route to the corporate state, and that is fascism.

The fight over country-by-country reporting is, then, no minor issue: this is about the right to decide who really rules and the stakes are very high indeed.

And, err, yes, we do normally think that the rule of law is conditional on the consent of those subject to it. Any number of leftie campaigns are about “No, we do not consent to this law, change it!”. As is most of Ritchie’s campaigning of course. No, I do not consent to people paying less tax than I think they ought to, change the law!

Further, err, yes, we would rather like the government to obey the law. Like, you know, the UK government over Cadbury, Vodafone and the CFC rules? Or only locking up child rapists when there is evidence that child rape has occurred and it was ‘im what dunnit?

You know, law?

25 thoughts on “Aren’t we lucky? Two stumps in one day!”

  1. I may be wrong but he seems to be heading towards proposing either the creation of a National Audit Company, responsible for all audits under state control, or the flat out nationalisation of the audit wings of the Big 4.

  2. OT: but in light of today’s news from Brussels, I keep waiting for someone to mention the EU’s claim that we can only be safe by voting remain

  3. “In other words the rule of law is now conditional on the consent of those supposedly subject to it.”

    Imagine the horror. Laws passed conditional on the support of the people subject to it. Used to be called Common Law, I believe. That’s the route to Fascism.

    As opposed to Laws made up by some bloke in a shed in Norfolk, on a whim. That’s not the path to Fascism.

  4. “Suppose that the EU – the largest supra-national legislator in the world – thinks it cannot legislate because of a legal minefield. Who created that minefield? What is the risk? And why can’t it be cleared?”

    Ah Richard. That’s the thing with written constitutions and independent judiciary es and…well with democracy really; you xan’t just clear the legal minefield to suit yourself.

    Anyway, enjoy casting your vote in the upcoming referendum…and say TTIP quietly to yourself while you do.

  5. “So, the threat of legal action is from the U.S. here and the issue arises because the OECD rules do not require that a group of companies submit its country-by-country report to all the countries in which it trades but only to the tax authority of its parent company, which is then legally bound to share it, which is what it looks like the US is refusing to do.”

    Legally bound? By which legal authority exactly Richard?

  6. “The EU has said of country-by-country reporting that to demand publication of data for all the jurisdictions in which a multinational company trades could lead it into a legal minefield.
    […]
    Who created that minefield? What is the risk? And why can’t it be cleared?”

    I haven’t really been reading up on this, but he’s asking companies to disseminate large amounts of sensitive data to a huge number of additional jurisdictions, yes? I imagine the EU is, among other things, concerned that they may be on the hook if that data gets abused. In which case, the minefield is *inherent to his cbc campaign*

  7. Also as I have said on here before, there are lines of business (particularly in the extractive industries) where companies are played off against each other by governments keen to extract the highest possible tax rate from them. If companies knew how much the others were paying they’d collude against the government in negotiations. If the populace knew how much cash was disappearing from government coffers there’d be an uprising. And so in such jurisdictions, which usually have a nominally socialist single party state in operation, public declaration of your tax arrangements is a criminal offence. So from a company’s perspective they can be in EU legal trouble or local local trouble, or possibly both.

  8. And now…

    Richard Murphy says:
    March 22 2016 at 12:14 pm

    Law is frequently about imposing will on those who would rather not consent

    That is most commonly why we need law

    If we listened to those who did not consent we might never get anywhere and democracy – which must always ultimately be an exercise in imposing the will of a majority – would be forever undermined

    God forbid this man gets anywhere near power.

  9. Tim, sometimes I wonder if you insert those “candidly”s as a joke, just to keep us on our toes. Poe’s Law ‘n’ all.

  10. @Max – what he’s saying is that all these uppity bloody foreigners have got to do as we (as in “all right-thinking people”) tell them to. Very colonialist and more than a whiff of racism in that there’s a privileged white man instructing Africans to do as he says

  11. “…must always…imposing…on those who do not consent”. Just the choice of words is amazing.

    On a wider front, has he ever heard the phrase “tyranny of the majority”.

  12. In the manner of Roger Mellie’s useful Profanosaurus, Ritchie’s fascist outpourings should be recorded in a Murphy’s Diktatosaurus.

  13. “If we listened to those who did not consent we might never get anywhere and democracy – which must always ultimately be an exercise in imposing the will of a majority – would be forever undermined”

    St the moment, today, a majority of the citizens of Brussels would like to string uo anyone with an Arab – sounding name. Those with Arab – sounding names would no doubt not consent. But we’ll never get anything done if we listen to them would we Richard. Democracy requires us to impose the will of the majority. String ’em up!!!

  14. “If we listened to those who did not consent we might never get anywhere and democracy – which must always ultimately be an exercise in imposing the will of a majority – would be forever undermined”

    As anyone pointed out to Murphy that under our current electoral system the Tories have a majority?

  15. @ AndrewC
    To the lefties, the Tories did not get a majority because all of those who did not go to the polling station to vote are deemed to be anti-Tory (even if they were paid-up members of the Conservative Party who died after October 2014 before the election in May 2015).
    Pointing out facts to Murphy is inviting an insult.

  16. Ironman

    Anyway, enjoy casting your vote in the upcoming referendum…and say TTIP quietly to yourself while you do.

    That’s beautiful.

  17. AndrewC,
    Murphy has ruled that the 2015 election produced a clear “progressive majority” in terms of numbers of votes.

    How this is calculated is unclear as Con + UKIP was just over 50%, and one might assume that those still voting LibDem were expressing some sort of approval in the coalition.

    Regardless, the ruling was made. There may be some who do not consent, but if he listened to blah blah.

  18. So on that logic I suppose the majority were not in favour of any laws passed by the UK Parliament for probably decades, including the additional rate of income tax, rise in stamp duty, and all the other increases.
    And it clearly explains why it was bad to bring in the poll tax, reduce top rate, and so on.

  19. “today, a majority of the citizens of Brussels would like to string uo anyone with an Arab – sounding name.”

    Have you never been to Brussels? The majority of its citizens have Arab sounding names.

  20. There’s more:

    ‘Richard says:
    March 22 2016 at 1:50 pm

    Nice move towards Majoritarianism……so democracy in terms of protecting minorities, even dare I say the “wealthy” minority can go get stuffed!

    If you can get your way with 50.1% of the vote then you can use the State through law to stomp the wealthy!…..Your honesty is interesting although repulsive at the same time!

    Richard Murphy says:
    March 22 2016 at 6:23 pm

    I am a democrat

    And expect those who abuse to be voted out

    If you have a problem with that you are part of the problem we face’

    Richard will now be sent for re-eduction to the camp in Norfolk.

  21. I’m fairly certain that last year’s Google Inc company pubically-available report to the US Securities Comission, as required by US corporate law for publically listed companies, *does* list income by country, and a quick check confirms that it does, albeit just US, UK and ‘rest of world’. The paid-for shareholders’ report goes into more detail, bargain for 30 quid or so.

    Maybe Prof/5 Murphy would like to hire me as a Information Research Advisor to teach him how to use publically-available information sources to find publically-available information.

  22. He’s a democrat certainly – in the sense that the ‘Democratic People’s Republic of Korea’ is a democracy…..

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