ARTICLE · 26 MARCH 2026

OECD Side-By-Side Package Secures Future Of Pillar Two

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On 5 January 2026, the OECD released long-awaited administrative guidance on the “Side-by-Side” system (SbS system) under the Pillar Two global minimum tax rules. The 88-page guidance package introduces four new safe harbours, extends the transitional Country-by-Country Reporting (CbCR) safe harbour and implements the SbS system agreed by the G7 and the US on 28 June 2025.

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Audrey Azzopardi

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On 5 January 2026, the OECD released long-awaited administrative guidance on the “Side-by-Side” system (SbS system) under the Pillar Two global minimum tax rules. The 88-page guidance package introduces four new safe harbours, extends the transitional Country-by-Country Reporting (CbCR) safe harbour and implements the SbS system agreed by the G7 and the US on 28 June 2025. (See the tax alert dated 8 January 2026 for the US perspective on the new guidance). Despite the name “side by side,” the guidance covers much more than the details of the SbS agreement—it is about the long-term future of Pillar Two and all in-scope multinational enterprise (MNE) groups should consider its impact.

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