1. For the purpose of Article 35 of the proposed EU Directive, the following definition applies:

(a)   ‘multi-parented MNE group’ means two or more groups where the ultimate parent entities of those groups enter into an arrangement that is a stapled structure or a dual-listed arrangement that includes at least one entity or permanent establishment which is located in a different jurisdiction.

(b)   ‘stapled structure’ means an arrangement under which:

(i)    50 % or more of the ownership interests in the ultimate parent entities of separate groups which, if they are listed, are quoted at a single price, and are, by reason of form of ownership, restrictions on transfer, or other terms or conditions, combined with each other, and cannot be transferred or traded independently; and

(ii)   one of the ultimate parent entities prepares consolidated financial statements in which the assets, liabilities, income, expenses and cash flows of entities in all of the groups concerned are presented together as those of a single economic unit; and

(c)   ‘dual-listed arrangement’ means an arrangement entered into by two or more ultimate parent entities of separate groups under which:

(i)    the ultimate parent entities agree to combine their business by contract alone;

(ii)   the ultimate parent entities’ activities are managed as a single economic unit under contractual arrangements while retaining the separate legal entities of each ultimate parent entities;

(iii)  the ownership interests of the ultimate parent entities that comprise the agreement are quoted, traded or transferred independently in different capital markets; and

(iv)  the ultimate parent entities are required to prepare consolidated financial statements in which the assets, liabilities, income, expenses and cash flows of entities in all of the groups are presented together as those of a single economic unit.

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