The European Union has endorsed new rules obliging large companies to disclose tax-related information on a country-by-country basis. It is the latest move at EU level to encourage tax transparency by multinationals.

EU finance ministers meeting in Brussels signed off on the so-called 'DAC4' directive, an update of existing EU legislation that will oblige multinational companies to provide certain, tax-related information on an annual basis for each tax jurisdiction in which they do business.

Ireland, which was represented by the Minister for Finance Michael Noonan, was broadly in favour of the measure, which mirrors legislation already brought in by the government in December.

But the move to introduce further tax avoidance measures is a sign of the European Commission’s focus on aggressive tax planning.

EU economics commissioner Pierre Moscovici welcomed the agreement as "another major step forward towards enhancing transparency on tax matters."

“The automatic exchange of information on country-by-country reports will provide national authorities with the necessary insight to combat aggressive tax planning structures”, he said, hailing the agreement as a signal that the EU is “ready to deliver on our common goal of fair and effective taxation.”

In line with OECD standards agreed last autumn, the new rules will not oblige companies to disclose tax information publicly, but rather to other national tax authorities.

Tax campaigners criticised the new rules as falling short of the full country-by-country reporting obligations in terms of public disclosure. The Green group in the European Parliament criticised the fact that the new rules will only apply to large companies, arguing that less than a third of big corporations in Europe will be covered by the new legislation.

EU finance ministers on Tuesday also agreed to reform the Code of Conduct on Business Taxation group, a low-profile but powerful working group comprising representatives of each member state which deals with aggressive tax planning issues.

While the Council pledged to improve the group’s transparency, it stopped short of endorsing significant changes to the group, including a demand from some MEPs that the chair of the group should appear before the European Parliament.

Today's meeting comes ahead of this week's Global Tax Policy Conference which is taking place in Dublin Castle and will see senior figures from the IMF, European Commission, OECD and the private sector outline the recent changes in global taxation.