Why DAC and Pillar 2 remain operational priorities
The EU Directive on Administrative Cooperation, commonly called DAC, provides the legal framework for tax-information exchange between Member States. It is particularly relevant to multinational groups because the Pillar 2 rules require information concerning the top-up tax information return to be collected and exchanged in a standardized way.
In October 2026, the European Commission stated that Czechia had not fully transposed the EU rules implementing standardized collection and automatic exchange of Pillar 2 top-up-tax information. The Commission noted that tax authorities across the EU should be able to begin exchanging relevant information from June 2026. The enforcement action is a reminder that domestic implementation can differ in timing even where the underlying EU obligation is common.
What a group should control
A group’s compliance process should identify four separate responsibilities:
- Determine scope. Confirm whether the group falls within the Pillar 2 rules based on consolidated revenue and group structure.
- Prepare the data. Establish ownership for jurisdictional effective tax rates, covered taxes, substance-based exclusions, deferred-tax information, and domestic minimum-tax adjustments.
- Coordinate filings. Track whether the designated filing entity can file centrally and whether local notifications are still required in each relevant Member State.
- Validate exchange readiness. Confirm that the tax authority in each jurisdiction has adopted the necessary forms, electronic formats, and filing channels.
Practical example
A multinational group headquartered outside the EU may have subsidiaries in Germany, France, and Czechia. Even if the group prepares one global data package, it should maintain a country matrix showing each entity’s local notification requirements, filing authority, approved format, deadline, and responsible signatory. A central filing arrangement should not be assumed to eliminate every local procedural step.
Actionable controls
- Maintain a DAC/Pillar 2 obligations register by entity and jurisdiction.
- Reconcile the Pillar 2 information return to the group’s tax provision and statutory accounts.
- Keep evidence for jurisdictional elections and safe-harbour positions.
- Test electronic filing credentials and authorized-representative access before the filing window.
- Review Commission enforcement notices for countries with delayed or incomplete transposition.
- Escalate inconsistencies between local legislation and the group’s global reporting model.
The key lesson is that Pillar 2 compliance is not only a tax-calculation exercise. It is also an information-governance and filing-technology project. Groups that centralize calculations but neglect local notification and exchange mechanics may still face avoidable compliance risk.