GROUPAMA / 2019 Universal Registration Document

7 FINANCIAL STATEMENTS Consolidated financial statements and notes

regarding the protection of customers, the key function of the ● Compliance Verification of Groupama Assurances Mutuelles contributesto the operationalimplementationof several themes, including: ACPR instruction 2015-I-22 of 2 October 2015 on the ● questionnaire on commercial practices and protection of customers, the variousrecommendations of the ACPR, ● monitoring of themajor risk forthe Group of “failure to advise”, ● deploymentof the InsuranceDistributionDirective, which also ● includes product governance, the prevention and managementof conflicts of interest, the compensationof the distribution networks, as well as their professional capability and continued training, the recurringenrichment ofthe permanent control system, ● monitoring and implementation of action plans to improve ● marketingmeasures (OAV); regarding the fight against corruption and influence peddling ● (Sapin 2 law), the key function of Compliance Verification of Groupama Assurances Mutuelles manages the various operational implementation projects. 5.3 Changes to the tax laws of countries where Groupama operates may have adverse consequenceseither on some Group products and reduce their attractiveness, especially those that currently receive favourable tax treatment, or on the Group’stax expense. Examples of such changes include the taxation of life insurance policies or annuities contracts, changes in the tax status of some insurance or asset management products and tax incentives or disincentives to investing in some asset classes or product categories. The role of the Group’s Tax Department is to provide information and monitor regulations for all the entities of the Group. It is also regularly questionedabout specific technical points and is involved in preparingthe end-of-yearfinancial statements.In this capacity, it Tax risks

ensuresthat the tax consolidationrules are applied (Article 223A et seq. of the General Tax Code) for the Group and, workingwith the Group Accounting Department, prepares the report on the tax position of the consolidatedcompanies.It also helps to implement documentationand archiving proceduresin terms of computerised accounting records, as required under tax law, particularly as part of dedicated “CFCI” (Computerised Accounting Tax Audit) Committees for each French entity. Lastly, within a Steering Committee, it coordinatesthe establishmentand the monitoringof regulationson automatic exchangesof tax information,resulting in particular from the US Foreign Account Tax Compliance Act (“FATCA”) or the transpositionof the European DAC (Directive for Administrative Cooperation). Groupamagenerallyremains vigilant on the future interpretationsor developments of the tax systems in the countries in which it operates that could lead to an increase in tax expenditures, generatecompliancecosts, or adverselyaffect the Group’sactivity, cash position,and net income. With regard to transfer pricing, the Group Tax Division overhauled the 2019 Master File and organised the internal collection of new information, in particular financial information, which is requested from 2019 onwardsfor 2018 so that the 2019Master File in its new version, meeting the new French requirements in line with OECD standards, could be finalised and sent in English to all the internationalsubsidiaries. The Group’s tax situation in France is also marked by the establishment of a tax partnership between Groupama and the DGFIP, followingthe signing of a protocolon 26 Junewith the SPE (Service Partenaire des Entreprises), which is a major step in the evolutionof the Group’s tax management. In the light of the current tax situation in France, attention is drawn to the revision, once again unfavourableto large companies,of the trajectory of the reduction of the corporate tax rate, without calling into question the target of 25% in 2022, and the postponementof the establishmentof the VAT group regime, now announcedin the 2021 finance bill, which is intendedto replace the current regime of grouping of resources condemned at the Community level.

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Universal Registration Document 2019 - GROUPAMA ASSURANCES MUTUELLES