THE IMPLEMENTATION OF BEPS ACTION 13 IN NIGERIA COUNTRY-BY-COUNTRY REPORTING: FROM GLOBAL STANDARDS TO DOMESTIC PRACTICE/ SHAKUR SHAFA’ATU AMEEN

THE IMPLEMENTATION OF BEPS ACTION 13 IN NIGERIA COUNTRY-BY-COUNTRY REPORTING: FROM GLOBAL STANDARDS TO DOMESTIC PRACTICE.

SHAKUR SHAFA’ATU AMEEN

The OECD/G20 BEPS Project marked a pivotal moment in global tax transparency, and Action 13 which ensures a Country-by-Country Reporting (CbCR) of global activities of large MNEs emerged as one of the foremost minimum standards. For developing countries, CbCR presented an opportunity to have more transparency on the activities of multinational entities and in some instances to detect how they use tax avoidance schemes to shift profits and pay reduced taxes across certain jurisdictions. Nigeria, as a member of the Inclusive Framework, a group of jurisdictions, committed to the implementation of the minimum standards of the BEPS related measures, signed the Multilateral Competent Authority Agreement on Country-by-Country Reporting (CbC MCAA) in January 2016 and produced the Income Tax (Country-by-Country Reporting) Regulations 2018 supported by the FIRS Guidelines for the implementation of the Country-by-Country Reporting in Nigeria.

The Nigerian experience provides an important case study on how developing countries try to balance the tension between aligning with global benchmark and adopting international rules tailored to its economic and structural realities. Nigeria’s adoption of CbCR is a deliberate policy choice to strengthen and deepen transparency around the operations of MNEs in its territory. Especially, with MNEs operating in strategic sectors like oil and gas, telecommunications, consumer goods, and manufacturing. Nigeria has long grappled with challenges of base erosion, profit shifting, and limited access to data from other jurisdictions. CbCR therefore performs a dual function by allowing Nigeria access into the global automatic exchange of information system and gives its tax authority extensive and richer data for risk assessment. Essentially, the Nigerian framework mirrors the OECD standard. It requires qualifying multinational groups to report revenue, profit, income tax paid and accrued, number of employees, tangible assets, and business activities for each jurisdiction in which they operate. These data points are key to identifying mismatches between economic substance and reported profits.

Nigeria's regime is based on the OECD structure but provides for a domestic threshold of NGN 160 billion in consolidated group revenue, as suppose the OECD threshold of EUR 750 million. Whereas the OECD uses a fixed euro amount, the implicit effect of using a threshold in naira is that it brings more MNEs within scope when the exchange rate fluctuates. The filing deadline also aligns with the OECD recommendation in that CbC reports must be filed within twelve months after the close of the fiscal year and the Nigerian constituent entities must notify the tax authority about the identity of the reporting entity. However, the Nigerian approach is not simply a duplication of OECD rules. It reflects a careful balance between international alignment and domestic adaptation. The Guidelines for country-by-country reporting in Nigeria published by the FIRS contain more detailed confidentiality and internal access provisions compared to the OECD template, reflecting the need of Nigeria to reassure its taxpayers that sensitive information will not be misused or leaked. Nigeria also has an electronic filing infrastructure known as the FIRS AEOI-CbCR portal to allow MNEs in Nigeria submit their CbC reports to the FIRS. This portal was built with Nigeria’s context in mind considering local administrative constraints and the need for additional supervised data handling. 

The most significant divergence, however, lies in the legal and institutional framework. Whereas the OECD standard assumes a stable domestic legal basis for implementation, Nigeria's CbC Regulations 2018 faced constitutional challenges. The 2023 decision in Checkpoint Software Technologies B.V Nigeria Ltd v. FIRS where the Tax Appeal Tribunal (TAT) held that the CbC Regulations were null and void because they were made without a properly constituted FIRS Board as required under the FIRS (Establishment) Act of 2007 and because the MCAA though signed by Nigeria, required domestication pursuant to section 12 of the 1999 constitution. In 2025, the Federal High Court upheld the decision of the TAT. Unlike some jurisdictions with clear legislative framework for implementation of global standards, Nigeria operates under a system in which such instrument must undergo rigorous domestication process before it can come into force under the Nigeria law. However, these legal disputes on the constitutionality of such instrument and the fact that Nigerian courts challenged the legal validity of the CbCR regulation 2018 does not imply that Nigeria rejects CbCR or the global effort to curb BEPS. Rather, they show the complex realities developing countries face when integrating global tax standards into domestic legal systems. Despite these challenges, Nigeria continues to implement CbCR through administrative practice and continues to participate in international cooperation to curb BEPS. The controversy is thus structural and institutional not ideological. 

This balance between adopting global standards while adapting them to local realities is what makes Nigeria's implementation of BEPS Action 13 an illustrative case. It shows that aligning with international best practice is necessary and but not sufficient. For developing countries like Nigeria, the key issue is whether these rules can be integrated into a legal system that has to make accommodations for constitutional requirements, administrative limitations, judicial interpretation, and resource constraints. Nigeria’s adaptations show a practical approach by maintaining the core transparency obligations under Action 13 while modifying thresholds, procedural safeguards, filing systems, and administrative rules to suite domestic circumstances.

In conclusion, Nigeria’s approach illustrates that participation in international tax cooperation goes beyond adopting rules, but about adapting them in conformity with domestic law, and build a system that functions effectively within local constraints. It is this balance between global alignment and domestic practicality that defines Nigeria’s contribution to modern international tax governance.