BRUSSELS | 8 DECEMBER 2025
OECD Establish Framework for Automatic Exchange of Information on Immovable Property
Last week, twenty-six jurisdictions pledged to implement the new OECD framework for the automatic exchange of information on offshore real estate, marking an expansion of global tax transparency beyond financial accounts and crypto-assets. The initiative is set out in the Multilateral Competent Authority Agreement on the Exchange of Readily Available Information on Immovable Property (IPI MCAA), designed to close long-standing gaps in cross-border tax reporting by enabling tax administrations to access electronically searchable and reliable data on foreign property holdings, transactions and related income. The framework responds to challenges faced by administrations, including limited visibility over cross-border immovable property ownership, rising levels of underreported foreign property and the use of real estate to shelter undeclared wealth.
The Framework provides two reporting modules: one covering ownership visibility through a one-off exchange of existing holdings and annual reporting of new acquisitions, and a second covering disposals and recurrent income to support enforcement of capital gains, rental and related taxes where relevant. Participation is voluntary and based on the provision of information on an “as is” basis, subject to confidentiality and data-protection safeguards and the requirement for jurisdictions to demonstrate foreseeable relevance when opting to receive information.
The Multilateral Agreement establishes a standardised minimum data set, including identifying information for legal and beneficial owners, property characteristics, transaction details and income data, with exchanges to be transmitted via the OECD Common Transmission System. One-off exchanges are due by the end of January following the agreement’s entry into effect, with annual exchanges targeted for 31 January each year and no later than 30 June. The framework also includes mechanisms to correct errors, safeguard confidentiality, address non-compliance and allow amendments.
The OECD expects the first exchanges to begin in 2029, noting that strengthened transparency in this area will help tax administrations verify the tax treatment of foreign property income and gains and assess the legitimacy of funds used for acquisitions.
Estonia Raises Implementation Concerns for the EU Pillar 2 Global Minimum Tax Directive
In a recent communication to the European Commission, Estonia’s Ministry of Finance has outlined its concerns regarding the implementation of Directive 2022/2523 and the evolving OECD Pillar Two rules. The letter argues that the rapid development of OECD technical standards, contrasted with the fixed obligations set out in the Directive, places the EU at a structural disadvantage. Although 137 jurisdictions endorsed Pillar Two in 2021, only 55 have implemented it by 2025, and only the EU has made implementation mandatory. Estonia notes that recent OECD changes, including carve-outs benefiting larger economies, risk undermining competitive neutrality and disadvantaging EU-based groups in global markets at a time of heightened competitiveness pressures.
The communication highlights that Article 32 of the Directive, originally intended to support simplification through safe harbours, now risks incorporating substantive changes from the OECD process into EU law without proper legislative scrutiny. Estonia argues that the scope and complexity of the developing rules exceed what should automatically be absorbed into the Directive, emphasising the need for full Member State participation in decisions affecting tax obligations and national budgets. Smaller administrations, it notes, lack the capacity to keep pace with the volume and speed of OECD rule-making, limiting their ability to assess wider system impacts.
Estonia further explains that, despite its ability to defer implementation until 2030, it must already begin preparing for complex and costly administrative requirements, even though expected revenue is minimal. The government points to other countries’ experience showing that the rules are expensive to administer, frequently adjusted and burdensome for both tax administrations and businesses. In the context of increased fiscal needs, including rising defence expenditure, Estonia considers the minimum tax an inefficient use of resources and potentially counterproductive to broader compliance priorities.
To address the misalignment between EU and OECD processes, Estonia proposes options including suspending the Directive until global rules stabilise, repealing it entirely, or amending Article 50 to provide a permanent derogation for Member States with very few ultimate parent entities. It argues that such a derogation would not undermine the integrity of Pillar Two, as the UTPR would continue to address undertaxed profits. The communication concludes by calling for a more proportionate and flexible EU approach that preserves competitiveness, reduces administrative burdens and supports efficient revenue collection across all Member States.
FISC Hearing on Taxation of Ultra-High-Net-Worth-Individuals