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Intellectual Property Rights (IPR) in China and the 15-year Plan.

25 Окт 2021
China

Are you planning to do business in China? One of the most important, but often forgotten, aspects is the protection of your intellectual property rights (IPR). Without this protection, others can copy your product or service and sell, import, or export these without your agreement. In this article, a real-life example is analysed, we discuss the need for IPR registration, recommend the best timeframe to register, and elaborate the 15-year IPR plan. All to prepare you for business in China.

 

Case study

In the China business week hosted by the Rijksdienst voor ondernemend Nederland (RVO), the commercial manager of Rymax Lubricants elaborates their relation with the Chinese property right system.

At the beginning of the establishment of the brand, the first step of business for Rymax Lubricants was not to expand to the Chinese market. However, they quickly were active on the Chinese market yet without their knowledge. Due to product previews and/or showcasing their products at events, Chinese fraudsters took immediate action. They registered the trademark of Rymax Lubricants with the Chinese government and duplicated everything: from the site and the logo to the complete mirroring of the advertisement video. The Chinese company behind the fake Rymax, sold their own oil while lifting on the European brand and success of Rymax.

After a long juridic battle, Rymax remained to have no power in China. Trying to take down the Chinese website or use their European intellectual property rights to tackle the stolen trademark also bore no success. After years of battling, Rymax changed their trademark, and thus the brand name, and immediately registered their intellectual property rights in China. Nowadays, Rymax Lubricants is active in the Chinese market and is having a fruitful business in China.

 

Should you register your intellectual property rights?

Registering for intellectual property rights is highly recommended when doing, or planning, to do business in China. In the case of registration, you can request websites with your products to go offline, request a court order, or cooperate with Chinese customs in the case of infringements.

According to the first-to-file system in China, your intellectual property is not protected if your property or patent is not registered to the official Chinese authorities. In the case of Rymax Lubricants, the lack of property rights in China shows the territorial nature of registration. Importantly, in China, the first to file is the owner of the intellectual property right, even while this is not the original owner or inventor of the service/ product. This is called a bad faith registration and happens because there are no user requirements to register for a trademark. Be aware to also register the following aspects of your company:

 

  • Production in China

When you are solely producing in China, it is recommended to register your trademark. Without trademark registration, there is an unnecessary risk and vulnerability that results in a higher probability of intellectual property infringement.

 

  • Copyrights

Registration of copyrights is theoretically unnecessary since they get automatically protected. However, to diminish challenges or disputes it is recommended to also register your copyrights.

 

  • Brand name

Besides registering your products, it is important to register your brand name. Here it is recommended to register your original brand name and the Chinese brand name of your product.

 

When to register?

To ensure that you are in charge of your intellectual property, you should register the aforementioned aspects before making your product or service public. This entails before advertisements, selling your products/ service, or fairs. When this is not done in time and thus not registered by yourself but by someone else, registering in China is not possible anymore.

 

Remarks when registering

When registering, be aware of the following tips to make the registration process as smooth as possible:

 

  • Be aware that there are other regulations regarding intellectual property rights in Hong Kong, Macau and Taiwan. They have differingjuridical systems than in mainland China. Meaning that different protocols are present and that different intellectual property rights registration are needed in these regions.

 

  • Foreign appliers for registration (e.g. trademark, brand name) without a juridical presence in China need to apply via a local patent agent to successfully submit the registration request.

 

 

China’s 15-year plan

On September 22, the Chinese government announced the 15-year plan (2021-2035) to assist the development of intellectual property rights (IPR). The plan entails that the IPR protection becomes stricter, which results in a higher level of public satisfaction in the business branch, and thus a greater market value of IPR by 2025 for the Chinese market. By 2035, the IPR competitiveness within China will develop and rank among the top in the world as elaborated in the plan. The emphasis in building this IPR protection system and supporting the world-class business environment, encouraging motivation by the operating system of IPR in the market, convenient and beneficial system for the public and boosting the participation in the global IPR governance.

 

Conclusion

With this article, we hope to have you sufficiently informed about the complete picture around the Chinese trademark registration and the Intellectual property rights . As previously emphasised, and as seen in the case study, we highly recommend to not take the risks for disputes or infringements (especially in a foreign country). For more information about  If interested in personal advice regarding international business advice, tax situations or consolidation (in China), Global Connect Admin B.V. can assist you with these challenges due to the rich experience and framework of connections.

 

 

Sources

China Business Week 2021 | Agenda (b2match.io)

China issues guideline for IPR development (www.gov.cn)

Intellectueel eigendom China | RVO.nl | Rijksdienst

From Beach Destination to Global Influential Trade Port: Hainan’s Masterplan

11 Окт 2021
China
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Hainan, the tropical destination on the south coast of China is more than a wedding island. Announced on June 1st this year, the Masterplan by the Chinese government is to transform the entire island province into China’s biggest special economic zone (SEZ). By 2025, this trade port is «basically» established and by 2035 this system will focus on the free and convenient flow of trade and investment. Whereas this results in global presence and influence, what does this Masterplan entail and what are the potentials for economic trade and welfare?

What is the Masterplan?

The Masterplan for the Hainan Free Trade Port (FTP) is aimed at the transformation of the southern island province into the flagship of trade ports. While already coined in 2017 as a concept, and approved by the province in 2018, the implementation of the FTP is currently ongoing. Moreover, one of the main aspects is that the FTP can easily cooperate and compete with the high-level ports of Hong Kong, Singapore and Dubai due to the international location. While the Hainan Free Trade Port is basically established in 2025, the maturing of the port will continue decades after the establishment. Here, the prospect is to establish a fully developed high-level free trade port including strong international influence around the year 2050. Bearing this in mind, there will be 4 major steps in the timeline for achieving different stages of development:

 

 

 

 

Hainan Free Trade Port policy highlights

For investors, the key policeis under the Masterplan yield the most importance weighting the opportunities that the Hainan FTP can provide. Therefore, a few policies will be highlighted to further explore the potentials Hainan can offer:

 

 

Taking the timeline and the benefits of the new Free Trade Port policies into account, the district of Hainan is an interesting development in the further globalisation of China. In the search for competitiveness among the high-level free trade ports such as Singapore and Hong Kong, the Masterplan for the Hainan Free Trade Port is aimed to be established in 2035 to fully realized these characteristics. The maturing of this FTP will continue until 2050, where Hainan should be established as a competing port with strong international influence. To optimize the potentials of the establishment of the Free Trade Zone (2025), and simultaneously the Free Trade Port (2035), we need to bear in mind that some industries have relatively more preferential support. According to RVO, the following industries will have these extra benefits in terms of taxation and restrictions within the Hainan Free Trade Port (see figure 2 points .2 & .3): Tourism — Modern service — New and High Tech — Retail (Duty-Free Consumer Goods) — Cruise and Yacht — Cultural and Sports — Education — Landscaping (Island loop Scenic Highway design) — Shipping — Air Transportation — Finance Lease — Offshore Trading — Modern Finance — ICT — Advanced Manufacturing — Medical Services and Pharmaceuticals — Oil, Gas and Chemicals — Deep Sea Technology — Modern Tropical Agriculture — Aerospace — Headquarter Economy.

 

Conclusion

Being aware of the potentials in the abovementioned sectors, the Hainan Free Trade Port can be seen as a good alternative to the Hong Kong, Singapore, and mainland China ports. With the international located position of the Hainan FTP, goods, people, and data can be easily transported to the mainland market due to the free flow in the first line and the efficient control at the second line. Whereas all the enterprises benefit from the full implementation of Zero-Tariffs on the entire island of Hainan and the increased duty-free shopping quota per person per year, the encouraged industries have competitive tax rates and exemption of duties when trading to mainland China in the case of Hainan processed goods having an added value of 30%. To conclude, the Hainan Free Trade Port is an interesting and encouraging development that should be followed closely to further evaluate the potential investing prospects.

Do you have any questions regarding the new Hainan Free Trade Port, or want other vital information to do business successfully? Feel free to send us any questions our way; we would love to assist you.

 

Sources

China-Briefing

RVO

 

 

Accounting in China: The differences between Chinese GAAP and IFRS

27 Сен 2021
China, Cross-border, Europe, GAAP, IFRS
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With the opening of the Chinese economy to foreign investments in the past 40 years, China is transforming into a global economic hub. However, with the standardisation of business administration with the International Financial Reporting Standards (IFRS), foreign investors need to be cautious of the differences between the global IFRS and the local Chinese GAAP. In this article, these inconsistencies between IFRS and Chinese GAAP are getting analysed, as well as looking into the optimal preparation for this challenge.

 

To increase the foreign direct investment (FDI) into the Chinese economy, the Public Republic of China (PRC) implemented special economic zones (SEZs) to further develop towards the biggest global economy. Hence, on the business administration level, this inquires for own accounting rules referred to as the Chinese Accounting Standards (CAS) or the Chinese General Accepted Accounting Principles (Chinese GAAP). While the CAS is implemented to reduce financial fraud or to optimize China’s tax strategy, in an international context the function of IFRS is to streamline international accounting regulations and transparency. Meaning, that the IFRS should be applied on top of the CAS so that the company can both adhere to the international and the local rules. Nowadays, while China starts to converge more with the IFRS principles, the Chinese GAAP still differs from the well-known and familiarized IFRS trademarked by foreign investors.

 

Background

The organ of the Accounting Regulatory Department of the Ministry of Finance (MoF) is responsible for setting the accounting standards in China. As the previous regulations of the CAS were mainly concerned with sorting a balance sheet of the state-owned industry in the socialist era, the regulations in current years are aimed to reflect the financial status, analyse the operating results, and maintain transparency (for the state). The Chinese GAAP has two subordinate accounting policies:

In 2001, the GAAP initialy included the Accounting Standards for Business enterprises (ASBE01), however, the ASBE01 was in 2006 further transformed into the ASBE06. The ASBE06, which currently is still required for all publicly traded enterprises in China, is the main set of accounting measurements. Luckily, the Chinese GAAP (ASBE06), has key similarities with IFRS. For small-sized business cooperations, there is a special set of accounting measurements called the Accounting Standards for Small-Sized Business Enterprises (ASSBE). This standard can be seen as a merger between IFRS and ASBE06 and has the goal to make it easier for small enterprises to follow the tax regulations and accounting standards.

 

Differences Chinese Generally Accepted Accounting Principles (Chinese GAAP or CAS) and International Financial Reporting Standards (IFRS)

Knowing that the CAS and IFRS have similarities, it is evident that the foreign investor should be aware of the regulations that differ within these sets of accounting rules. Hereby the differences between the CAS (GAAP) and IFRS:

 

  • Valuating Fixed Assets

Whereas the IFRS has the choice to utilize the preferred method of valuating fixed assets, the CAS does not endorse this flexibility. In IFRS, one can opt for re-evaluating the assets or use the historical-cost valuation method. In CAS, only the latter is agreed upon to be used when valuating fixed assets.

 

  • Implementation Delays

Whenever IFRS updates/changes are released, these new IFRS rules are not immediately, and in some cases never, adopted in the CAS. In short, the Ministry of Finance (MoF) will review the latest release of the IFRS and see if it can be adopted into the China business framework. For foreign investors, this means that 1) the IFRS updates are delayed, 2) the IFRS might never be applied and thus results in 3) the IFRS regulations can be different than in other countries. This can lead to serious problems in companies with an overarching implementation of IFRS changes (e.g. software) in all of the subsidiary ventures.

 

  • Common Services in China

When handling cases of common service in China, the CAS has a more detailed description of the situation. For example, In the case of merging two companies with similar interests and under the control of one entity.  The CAS requires a restatement of the figure while IFRS has no specific rules for this situation.

 

  • Uncommon Services in China

Opposite to the previous point, uncommon situations in China are less detailed than the IFRS counterpart. The Italian-Chinese Chamber of Commerce exemplifies this difference by looking at employee benefit plans. The CAS has no specific rules for staff benefits offered by international firms besides payments in the firm’s stock. In the case of using benefits packages for its subsidiaries, the mother company can get into serious problems and should always have contact with the MoF to address and record such transactions accurately.

 

  • Fiscal Year

The fiscal year of the CAS starts from January 1st, while the start of the fiscal year can be decided by the company when applying IFRS. Regarding IFRS, the year must be 12 consecutive years.

 

How to successfully do business in China regarding the Chinese Accounting Standards?

To minimalize the potential risk of conflicts with the law, it is recommended for foreign investors to notice the differences between CAS and IFRS and apply both of the accounting standards in the right way. In this process of familiarizing with CAS, the differences should be known, and the contact between the firm and the Ministry of Finance should be optimal to resolve challenges and uncertainties. Moreover, be aware that the CAS can only be filed in the China language, and that short-cuts in the Chinese accounting world often result in serious delays and non-compliance: further complicating the international business. Thus, in the case of maintaining an overview of both CAS and IFRS, even while it is about 90-95% similar, it is recommended to have (specialized) agencies on your side. With experts on the topic, it is evident that the venture is assisted by experience. This way, the short straw will not be drawn when dealing in an unknown and new business environment.

 

For more assistance in the field of IFRS, the newest software by Amelkis can support enterprises to customize and analyse data while preserving an overview of the IFRS regulations.

If interested in personal advice regarding international business advice, tax situations or consolidation (in China), Global Connect Admin B.V. can assist you with these challenges due to the rich experience and framework of connections.

When intrigued by the personal IFRS-software solution, Global Connect Consultancy B.V. offers help with the installation, optimization, and customization of the Amelkis software Solution.

 

Source:

China-Italy Chamber of Commerce

Special Economic Zones (SEZs) in China: How can they benefit your company?

22 Сен 2021
China
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Benefits | Special Economic Zone
Marking the 40th anniversary of China’s Special Economic Zones (SEZ), further scrutinization can start regarding the influence of the Special Economic Zones. Opposing the frequent usage of “SEZ” as a buzzword, what does it precisely entail and more importantly what advantages have these zones. How do the rules and incentives set these economic zones apart from Mainland China, and are these capitalistic hotspots beneficial for your organisations?  

What are Special Economic Zones?

Chinese Special Economic Zones are areas with different regulations and business policies than in  Mainland China. These zones can vary in function and scope but all adhere to the principle of supporting (specific) economic functions in globalising aspect. SEZs have been implemented since the late 1970s as part of the Chinese market reform in the conquest of realising the entrance to the international market. Remarkable is the placement of these SEZs: manifested in areas with a potential for high import and export volumes, being in the vicinity of airport and harbours, and / or being nearby natural sources. Resulting in the coverage of the east coast of China in the early stages of the SEZs to the establishment of SEZs in rural Xinjiang, to trade free zones (Shanghai), and regional zones that stimulate technology as seen in Dalian. Thus, in these 40 years of development, China opened coastal cities and created national and local high-tech zones to further attract investments. Nowadays, the fruitfulness of these experimental zones can be analysed:  SEZs contribute 22% of China’s GDP, 45% of total national foreign investment and 60% export, and created an estimate of 30 million jobs.  

The purpose of the Special Economic Zones

The purpose of the Chinese Special Economic zones, including the open coastal cities and the regional zones, is to attract foreign investments, innovation, and knowledge. These opportunities for China, and the fact that it is a cheap labour country, stimulates the build and development of infrastructure. Shenzhen in the Guangdong province, as one of the initial four SEZs, is the beneficiary of this Special Economic Zone: transformed from a fishing village to a nationwide, even worldwide, centre of innovation and development. Housing tech giants, telecommunication companies and even claiming to be the first to achieve “full coverage” of 5g within the tech hub of China’s Silicon Valley. As a reaction, the initial four SEZs transformed into 19 local development zones, 7 large-scaled SEZs, local and national free trade areas, and high-tech zones. As the purpose to foster globalisation in China becomes evident. However, how are SEZs applicable to your business?  

What are the benefits of China’s Special Economy Zones?

To ensure and stimulate foreign investors, the regulations in the SEZs (including open coastal and local zones) are made to attract. While exact policies or regulations can change over time (e.g. due to supply and demand of investors), the overarching advantages are as follows :
  • Tax incentives:
    • Reduced income tax: down to 15% (SEZ) versus 33% (Mainland)
    • Elimination of corporate tax under losses;
      • Being profitable after losses will result in reduced taxes for 5 years
    • Exemption of local taxes in certain industries
  • Special economic policies:
    • Duty-free export
    • Lowering import tariffs
  • Foreign companies are allowed to set up joint ventures
  • The local government has legislative authority
 
With all these benefits it is no wonder that SEZs attract a lot of foreign investments and thus benefit the flourishment of the Chinese economy. However, while SEZs are keeping the interests of investors high with the incentives, special economic policies and other benefits, China is slowly starting to applying these experimental policies as tested in the SEZs into the national policy. Furthermore, in line with the changes in Mainland China: the newest procedure is cutting the red tape to ameliorate the investment options in Mainland China.  

Conclusion

Currently, the incentives of the SEZs do not need to be causally related to the success of the high-tech and developed metropolises (e.g. Shenzhen). While the economic liberation is surely impactful for the growth of certain districts and businesses, not all of the 54 “special” zones have been successful. With constant development, creating new SEZs, changing regulations, the business-friendliness and the special tax programs for new entrants, the Special Economic Zones are even more convenient for new investors that are aiming to advance to the Chinese market. Knowing this, will your company be the next booming business in one of the Chinese Special Economy Zones? If interrested, we at Global Connect Admin provide administrative advice for European and cross-border businesses. Do you have any questions regarding the Special Economic Zones, or need other information to do business successfully? Feel free to send any questions our way: we would love to assist you.   Sources Experts hail pivotal role of special economic zones — Chinadaily.com.cn 经济特区：中国改革开放的伟大创举__凤凰网 (ifeng.com) Special Economic Zones in China (SEZs): Characteristics & Benefits — Intrepid Sourcing investing-in-africa-forum-chinas-special-economic-zone.pdf (worldbank.org)

Global Connect Consultancy Website Launch

20 Сен 2021
Company Updates
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Global Connect Admin is excited to announce the launch of the new Global Connect Consultancy website!

After months of work, Global Connect Consultancy will finally be able to assist you in all aspects regarding business consolidation:

  • Consolidation and Management Reporting Software
  • XBRL-software
  • IFRS 16 Lease
  • Intercompany tools

To realise this next step in consultancy, Global Connect Consultancy and Amelkis have partnered up offering new solutions with Amelkis-XBRL software.

 

If you are interested in personalised consolidation software solutions or have inquiries, you are more than welcome on the new Global Connect Consultancy website!
Do not forget to check out our YouTube channel

DAC6: Prepare for Reportable Cross-Border Arrangements in 4 Steps

09 Сен 2021
BEPS, Cross-border, Europe, Tax Planning
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Doing business in Europe means taking into account the many local rules, EU laws and international regulations. It is not unusual to benefit from various tax benefits or to research the best possible tax solutions. However, tax evasion and aggressive tax schemes are highly unwanted and will be fined. Therefore, it is beneficial to look into the DAC6: The EU Mandatory Disclosure Rules for cross-border arrangements. Let’s check if your company is well-prepared for cross-border arrangements.

What is DAC6?

DAC6 is an EU Council Directive that entered into force on 25 June 2018 and is implemented by EU jurisdictions into EU national law. Furthermore, DAC6 amends the cooperation between the EU Member States by focusing on joint actions and audits.

This directive’s primary goal is to harmonize tax rules in Europe by providing tax authorities an early’ warning system’ that notifies potentially aggressive tax planning schemes. Therefore, intermediaries are obligated to disclose potentially aggressive tax planning schemes on cross-border arrangements, otherwise called ‘reportable cross-border arrangements.

Step 1: Check who is required to disclose reportable cross-border arrangements

Intermediaries, and in certain situations, taxpayers, have an obligation to report cross-border arrangements to the authorities. An intermediary may be relieved from its reporting obligation if they can prove that another intermediary has already reported the relevant arrangement. The image below shows an overview of who is required to disclose these arrangements.

Step 2: Check if the arrangement is cross-border and ‘reportable’

For an arrangement to be cross-border, at least one of the participants must be located in more than one EU Member State. There is no reporting obligation if all participants are tax residents in the same jurisdiction or if there is no connection with any EU Member State. However, even an arrangement between two entities from the same EU Member State may be considered cross-border in some cases. A prime example is an EU entity with foreign shareholders. Below is a short overview of examples of non-cross-border and cross-border transactions.

For an arrangement to be reportable, one or more of the DAC6 Hallmarks must be met as set out in Annex IV of the DAC6 Directive. Therefore, a cross-border arrangement will only be reportable if one or more DAC6 Hallmarks are met. These hallmarks are characteristics or features of a cross-border arrangement that may indicate a potentially aggressive tax planning structure. The five categories of the hallmarks set out by the DAC6 directive are:

  1. Generic hallmarks linked to the main benefit test
  2. Specific hallmarks linked to the main benefit test
  3. Specific transactions related to cross-border transactions
  4. Specific hallmarks concerning automatic exchange of information and beneficial ownership
  5. Specific hallmarks concerning transfer pricing arrangements

The ‘arrangements’ mentioned in the hallmarks represent undefined terms included in the five hallmark categories.

Step 3: Do the Main Benefit Test

The intermediary or taxpayer may benefit from a tax advantage when they fulfill the ‘main benefit test.’ However, this tax advantage may only be considered under generic hallmarks of categories A, B, and (some parts of) C.

However, it is crucial to keep in mind that due to the broad scope of the hallmarks, DAC6 creates a risk of under-reporting and over-reporting. Furthermore, there is no consistent interpretative guidance agreed between the EU Member States.

Step 4: Act on time and prepare for penalties

You should report reportable cross-border arrangements through a special reporting form. Each Member State has its tax authority, so it is recommended to check out your local tax authority website. Generally, you must report a reportable cross-border arrangement within thirty days of the earliest of:

  1. the day after the arrangement is made available for implementation;
  2. the day after the arrangement is ready for implementation; or
  3. when the first step in the implementation of the arrangement has been made.

In case of non-compliance, such as non-reporting, incomplete or inaccurate information, the relevant intermediary and taxpayer may be subject to penalties. These penalties are up to a maximum of €870,000. In some instances, there will be a criminal prosecution. In other words, it is better to prevent penalties altogether. After all, significant sanctions and reputational risks apply to not only the businesses but also the intermediaries!

As mentioned earlier, there are risks in reporting your cross-border arrangements, such as under- and over-reporting. Meanwhile, many companies either miss out on tax benefits or end up overlooking essential hallmarks. We at Global Connect Admin provide tax advice for many European companies and international companies that have activity in the EU. Do you have any questions regarding the DAC6, (reportable) cross-border arrangements or other vital information to do business successfully? Feel free to send us any questions our way; we would love to assist you.

Sources

AKD Benelux Lawyers – EUR-Lex

Why XBRL could be more essential than expected

07 Июл 2021
Current news, ESEF, Europe, Netherlands, XBRL
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From paper to digital, from local to international standards (such as IFRS). Annual changes are no longer a surprise for companies. In addition to local rules and standards, more and more companies are confronted with international innovations, such as the influence of the Standard Business Reporting (SBR) system. For example, the XBRL format is not new and is not mandatory for everyone. Yet, it is fiscally helpful to keep an eye on updates regarding XBRL. This article briefly explains what XBRL is all about and how you can prepare for any (future) obligations.

XBRL in a nutshell

XBRL (EXtensible Markup Language) is an open international standard for digital business reporting. Millions of XBRL documents are added every year, with paper reports replaced by more effective and accurate digital versions. With XBRL, reporting terms can be authoritatively defined. Furthermore, you can represent the contents of financial statements, compliance, performance and business reports. For example, you can convert paper, PDF, and HTML-based reports into a digital XBRL-format in no time, allowing for quickly and accurately moving information between organizations. Therefore, using XBRL allows more people to use, share and analyze the data.

With XBRL, organizations can publish reports to ensure that the content can be accurately consumed and analyzed. Following a set of business and logical rules will go smoother and captures any errors at the source, ensuring error avoidance. In addition, it is crucial to ensure that the data provided conforms to advanced pre-defined definitions and taxonomies, which vary by country. The user can customize language and currency in their preferred style as well. Finally, comprehensive taxonomies and accurate tags allow for continued preparation, validation, publication, exchange, consumption and analysis.

 

XBRL in the Netherlands: From Micro to Large Enterprises

As of the financial year 2016 (1 January 2017), micro and small enterprises are no longer allowed to deposit publication documents via paper. In the Netherlands, electronic deposits are made through SBR, a digital delivery via Digipoort, by the intermediary or entrepreneur. In addition to this SBR method, entrepreneurs can also use the online service of the Dutch Chamber of Commerce, where they can deposit annual reports.

From the financial year 2017 (1 January 2018), the mandatory digital depositing also applies to medium-sized companies, except for medium-sized subsidiaries with a large company or listed company as a parent company. Large companies will still be excluded from the obligation in 2021.

Meanwhile, listed companies must adhere to the European Securities and Markets Authority (ESMA). ESMA prescribes that European listed companies must file their deposit accounts from the 2020 financial year based on ESEF (European Single Electronic Format).

At present, further mandates of XBRL and ESEF are still underway, with delays related to the current pandemic. Nevertheless, the first official Dutch ESEF publication was included in February 2021. Furthermore, SBR has set goals for organizations in the Netherlands to help exchange data in a structured, standardized and electronic manner according to a fast, effective and error-free method. SBR will continue to collaborate with the Dutch government. However, they will also collaborate with other organizations.

 

The Possibilities

The technical aspect of XBRL and XBRL-based software is often underestimated. Especially for large international companies, a good eye for detail can make all the difference in complex situations. XBRL itself is not a commercial product. However, XBRL-certified organizations and software vendors offer specific applications and services. They can significantly speed up and simplify the processing process. An example of a software supplier and service provider is Amelkis. With the Amelkis XBRL software, companies can import PDF registration documents and quickly convert them to HTML. In addition, they offer workshops for full software support. Therefore, they help hundreds of organizations every year with XBR-related matters, such as exchanging data between systems and periodically compiling reports from various sources.

In the end, there are several advantages to invest in commercial XBRL software. For example, the larger and more complex a company structure, the more tags and details apply. Subsequently, the ESEF requirements and the accounting standards selected by the organization must also be taken into account. With XBRL-software, you can process XBRL-based data in any XBRL-enabled software. In addition, the XBRL format is based on taxonomies, with tags depending on the need or demand. In addition, to save much time, you do not always have to re-enter specific data in the software.

Making the right choices can be challenging. In addition, constant updates from SBR, XBRL International and local governments require constant attention. If you have any questions about your business situation, please do not hesitate to contact us. Although XBRL may or may not be mandatory for your company, being well-prepared creates more certainty in the long term. A good start is half the work, which we are happy to help you with.

Bronnen

XBRL International – Standard Business Reporting – Kamer van Koophandel – Amelkis

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