On 6 October 2015 the Economic and Financial Affairs Council of the European Union reached a political agreement on a directive aimed at improving transparency in the assurances given by member states to companies about how their taxes are calculated. The Directive is one of a number of initiatives aimed at preventing corporate tax avoidance. The Directive will focus on the automatic exchange of information on advance cross-border tax rulings, as well as advance pricing arrangements. A tax ruling is an assurance that tax authorities give to taxpayers on how certain aspects of taxation will be dealt with in specific cases. An advance pricing arrangement is a type of a tax ruling, issued by tax authorities to determine the method and other relevant details of pricing to be applied to transfer of goods or services between companies. 

The Directive aims to ensure that where one member state issues an advance tax ruling or transfer pricing arrangement, any other member state affected is in a position to monitor the situation and the possible impact on its tax revenue. The new rules will apply from 1 January 2017.

As these types of tax rulings are rarely, if ever, sought by Irish funds in practice, it is unlikely that the implementation of this Directive will have any impact on the funds industry in Ireland.