Luxembourg-based groups within scope of the OECD Pillar Two framework face a new layer of cross-border information exchange obligations under DAC9 (Directive (EU) 2025/872), which requires constituent entities and designated filing entities to share GloBE information returns with the Administration des contributions directes – Luxembourg's competent authority for direct taxation. These obligations sit alongside the crypto-asset reporting regime introduced by DAC8 (Directive (EU) 2023/2226) and raise material procedural and compliance risks for multinational groups structured through Luxembourg, including SOPARFIs and holding or financing vehicles registered with the RCS Luxembourg. Understanding what has been transposed, what remains pending, and how Luxembourg-specific market practice is evolving is essential before the first reporting cycle closes.
DAC9 and Pillar Two: The EU Framework in Brief
Directive (EU) 2025/872 – commonly called DAC9 – establishes a harmonised mechanism for exchanging GloBE (Global Anti-Base Erosion) information returns among EU member states, building on the OECD Pillar Two model rules. Its purpose is to allow each member state in which a constituent entity is located to receive the relevant GloBE data filed by the group's designated filing entity, even when that entity is resident in a different jurisdiction.
DAC9 is a procedural directive: it does not alter top-up tax rates or the domestic qualifying status of any entity. It complements the substantive Pillar Two framework that Luxembourg enacted separately. Groups need to treat the two layers – the tax liability layer and the information-exchange layer – as distinct compliance tracks with potentially different deadlines, filing points, and penalty regimes.
Luxembourg's Transposition Position and the Role of the Administration des contributions directes
As of the date of this analysis, Luxembourg's national transposition of DAC9 is subject to the ordinary legislative process, and groups should monitor official publications by the Administration des contributions directes and the Chambre des Députés closely. The European Commission opened infringement procedures on 30 January 2026 against member states that had not yet transposed DAC8 and DAC9 into national law, signalling that the Commission regards the transposition window as having closed. Luxembourg practitioners and their clients therefore cannot treat the absence of a finalised domestic instrument as a reason to delay internal readiness work.
Once transposed, the Administration des contributions directes will act as the receiving and transmitting authority for GloBE information returns exchanged under DAC9. Luxembourg's existing infrastructure for the automatic exchange of tax information – built through successive DAC iterations – provides an established administrative backbone, but the specific filing portal, data format requirements, and validation rules for GloBE returns are subject to national implementing measures that have not yet been publicly confirmed in final form.
If your group has constituent entities in Luxembourg and the designated filing entity is located abroad, or vice versa, the interplay between the jurisdiction of filing and the jurisdiction of receipt creates coordination questions that merit early attention. Ferraz & Whitmore advises on cross-border Pillar Two structures and information-exchange obligations; please contact us at info@ferrazwhitmore.com or visit our contacts page to discuss your situation.
Which Luxembourg Entities Fall Within Scope
The GloBE rules – and by extension DAC9's exchange mechanism – apply to groups with annual consolidated revenue at or above the threshold set in the model rules. Luxembourg's corporate landscape means that a significant number of in-scope groups include one or more of the following:
- SOPARFI holding companies that form part of a multinational group's European holding layer and may be constituent entities for GloBE purposes, even if they generate little standalone taxable income.
- Luxembourg-resident financing vehicles interposed within intra-group lending chains, whose interest income and deductible charges affect the group's effective tax rate calculations at jurisdictional level.
- General partner entities and management companies associated with Luxembourg-domiciled investment structures, to the extent they are treated as constituent entities rather than excluded entities under the model rules.
- Intermediate parent entities that may be designated as the filing entity for the Luxembourg sub-group where the ultimate parent is in a non-EU jurisdiction that has not yet introduced a qualifying GloBE information return regime.
Entities registered with the RCS Luxembourg that are part of an in-scope group should carry out a constituent-entity mapping exercise as a first step, identifying their role (constituent entity, designated filing entity, or both) and confirming which jurisdiction will receive the exchanged return.
Filing Mechanics: What DAC9 Requires in Practice
Under the DAC9 framework, the designated filing entity submits the GloBE information return to its own competent authority. That authority then exchanges the return – or the relevant parts of it – with every other member state in which a constituent entity of the group is located. For Luxembourg entities that are not the designated filing entity, the practical consequence is that the Administration des contributions directes will receive data about them from abroad, without the Luxembourg entity necessarily lodging anything itself at that stage.
However, Luxembourg may impose its own local notification or supplementary filing requirements as part of national transposition. Until those requirements are confirmed, groups should not assume that zero local action is required simply because the filing entity is elsewhere. The risk of procedural non-compliance – separate from any substantive top-up tax exposure – is real and could attract penalties once the national implementing rules are in force.
DAC9 also addresses the timeline for exchange: competent authorities are expected to complete the transmission within defined periods after the filing deadline under the member state's domestic rules. Any delay by the filing-entity jurisdiction may have downstream effects on how Luxembourg's Administration des contributions directes processes or acts upon the information received.
Interaction with DAC8 and Crypto-Asset Reporting
DAC8 (Directive (EU) 2023/2226), aligned with the OECD Crypto-Asset Reporting Framework (CARF), introduces automatic exchange of information on crypto-asset transactions. DAC8 applies EU-wide from 1 January 2026. Annual crypto-asset information returns must be filed by 31 May of the year following the reportable year – meaning returns for 2026 data are due by 31 May 2027. This is a separate obligation from the GloBE information return, but the two regimes share the same institutional infrastructure: in Luxembourg, both flow through the Administration des contributions directes.
For groups that have Luxembourg-based crypto-asset service providers or that hold digital assets through Luxembourg vehicles, DAC8 compliance requires a parallel workstream. The LSI keyword overlap between DAC8 and DAC9 in regulatory commentary can create confusion; groups should treat the two as legally distinct obligations with different triggering facts, different reporting subjects (crypto-asset service providers versus constituent entities of large groups), and different penalty exposure. Luxembourg's penalty regime for non-compliance with information-exchange obligations has been tightened in line with broader EU enforcement trends, and the Commission's infringement procedures of 30 January 2026 underscore that member states and, indirectly, taxpayers face increasing scrutiny.
Cross-Border Implications: Ireland, Portugal, and Third-Country Parent Groups
Many Luxembourg-based structures are part of wider European holding chains that also include entities in Ireland or Portugal. Ireland has been an active transposing jurisdiction for Pillar Two, and its experience with GloBE information returns offers a useful reference point for understanding how the DAC9 exchange mechanism functions in practice. Our analysis of DAC9 Pillar Two filing obligations in Ireland sets out the Irish framework in detail and may assist groups managing both jurisdictions simultaneously.
Portugal transposed both DAC8 and DAC9 through Law No. 26/2026 of 3 June 2026. That law does not alter tax rates but confirms the annual crypto-asset return deadline and increases penalties for non-compliance. Groups with Portuguese constituent entities alongside Luxembourg holding vehicles should therefore assess both jurisdictions' filing calendars and ensure that the designated filing entity's submission covers all relevant constituent entities correctly.
For groups whose ultimate parent is outside the EU – in the United States, the United Kingdom, or Asia-Pacific jurisdictions – the question of whether a qualified domestic top-up tax or a local filing obligation applies in Luxembourg takes on added complexity. The Administration des contributions directes may receive exchanged GloBE data and use it to assess whether any top-up tax is due at Luxembourg level, independently of what the ultimate parent has filed in its home jurisdiction.
Procedural Risk and the Role of the Tribunal d'arrondissement
Luxembourg's judicial system routes direct tax disputes through the administrative courts; challenges to assessments made by the Administration des contributions directes on the basis of exchanged GloBE information would ultimately be heard by the Tribunal d'arrondissement sitting as an administrative tribunal, and potentially by the Cour administrative on appeal. At this stage, there is no settled case law on GloBE-derived assessments in Luxembourg – the legal framework is too recent. However, the procedural risk profile that groups should consider includes:
- The accuracy and completeness of the GloBE information return as exchanged – errors in the return filed by the designated filing entity in another jurisdiction could be used against a Luxembourg constituent entity without that entity having had a direct opportunity to review the data before submission.
- The timing of any assessment: if the Administration des contributions directes acts on exchanged data before domestic implementing rules are fully clarified, there may be procedural grounds to challenge the basis of the assessment.
- The interaction between Luxembourg's domestic tax treaties and the GloBE framework, particularly where a top-up tax charge may interact with withholding tax obligations on distributions from the Luxembourg entity.
- Confidentiality of exchanged information: DAC9 contains confidentiality provisions, but their practical enforcement in Luxembourg administrative proceedings raises questions that national case law has not yet addressed.
Given the absence of established precedent and the pace of legislative change, we recommend that Luxembourg entities within scope of Pillar Two take legal advice on their procedural position before the first exchange cycle is complete. Our team can be reached at info@ferrazwhitmore.com or through our contacts page.
Strategic Recommendations for Groups with Luxembourg Structures
The following steps reflect the practical priorities that emerge from the current state of the DAC9 framework as it applies in Luxembourg:
- Map constituent entities now. Identify every Luxembourg-registered entity that forms part of an in-scope group, confirm its role under the GloBE rules, and document who the designated filing entity is and in which jurisdiction it is resident.
- Monitor transposition progress. Track official communications from the Administration des contributions directes and legislative developments in the Chambre des Députés for finalised national implementing measures, including any local notification or supplementary filing requirements.
- Coordinate with the designated filing entity. If the Luxembourg entity is not the filing entity, establish a data-sharing protocol with the group function or the jurisdiction responsible for filing, so that Luxembourg-specific data in the GloBE return is accurate and reviewed locally before submission.
- Assess withholding tax interactions. Where a top-up tax charge at Luxembourg level could affect distributions to parent entities, review the interaction with applicable tax treaties and withholding tax rules, including any treaty relief available under Luxembourg's network of double-taxation agreements.
- Maintain CSSF awareness for regulated entities. For Luxembourg vehicles subject to supervision by the Commission de Surveillance du Secteur Financier (CSSF), confirm whether the GloBE information return or any related disclosure could give rise to reporting obligations to the CSSF alongside the obligations to the Administration des contributions directes.
- Separate the DAC8 and DAC9 workstreams. Treat crypto-asset reporting under DAC8 and GloBE information exchange under DAC9 as distinct compliance projects with different deadlines, different reporting subjects, and different risk profiles.
- Document the reasonable reliance position. In a period where national implementing rules are not yet confirmed, document the group's interpretation of its obligations and the steps taken to comply, as this will be relevant if any penalty dispute arises before the Tribunal d'arrondissement.
For groups looking to understand how corporate structuring choices interact with these new obligations, our analysis of Luxembourg corporate law and our overview of Luxembourg tax law provide additional context on the vehicles and regimes most commonly encountered in practice.
Outlook
The DAC9 information-exchange framework represents a structural shift in how GloBE compliance data flows between tax administrations within the EU. For Luxembourg, a jurisdiction whose attractiveness for holding structures, SOPARFI vehicles, and investment fund general partners is partly a function of its sophisticated tax treaty network and reliable administrative practice, the quality of domestic transposition and the efficiency of the Administration des contributions directes in handling exchanged data will matter to investor confidence.
The Commission's infringement procedures of 30 January 2026 signal that the pace of implementation will accelerate. Groups that approach these changes reactively – waiting for a finalised national text before beginning compliance preparation – face a compressed timeline and heightened procedural risk. Those that build internal readiness now, coordinate across jurisdictions, and maintain clear documentation of their GloBE filing architecture will be better placed to manage any scrutiny that follows the first exchange cycle.
If you would like to discuss the implications of DAC9 for your Luxembourg structure, or to review your group's Pillar Two filing architecture across multiple jurisdictions, please write to us at info@ferrazwhitmore.com or use our contacts page to arrange a consultation.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.