1. For the purpose of Article 34 of the EU Directive ‘joint venture’ means an entity other than an ultimate parent entity of an MNE Group whose financial results are reported under the equity method in the consolidated financial statements of the ultimate parent entity provided that the ultimate parent entity holds, directly or indirectly, at least 50 % of its ownership interest;

2.  For the purpose of this Article, the following definitions apply:

(a)   ‘joint venture’ means an entity other than an ultimate parent entity of an MNE Group whose financial results are reported under the equity method in the consolidated financial statements of the ultimate parent entity provided that the ultimate parent entity holds, directly or indirectly, at least 50 % of its ownership interest;

(b)   ‘joint venture affiliate’ means:

(i)    an entity whose assets, liabilities, income, expenses and cash flows are consolidated in the financial statements of a joint venture under an acceptable financial accounting standard or would have been consolidated had the joint venture been required to consolidate such assets, liabilities, income, expenses and cash flows under an acceptable financial accounting standard; or

(ii)   a permanent establishment whose main entity is a joint venture or an entity referred to in point (a).

2.  A parent entity that holds a direct or indirect ownership interest in a joint venture or a joint venture affiliate (together referred to as a joint venture group) shall apply the income inclusion rule with respect to its allocable share of the top-up tax of each member of the joint venture group in accordance with Articles 5 to 9.

3.  The computation of the top-up tax of the joint venture and its joint venture affiliates, shall be made in accordance with Chapters III to VII, as if they are constituent entities of a separate MNE group and the joint venture was the ultimate parent entity of that group.

4.  The top-up tax due by the joint venture group shall be reduced by each parent entity’s allocable share of the top-up tax of each member of the joint venture group that is brought into charge under paragraph 2 and 3. Any remaining amount of top-up tax shall be added to the total UTPR top-up tax amount pursuant to Article 13.

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