Groupama // 2021 Universal Registration Document

7 FINANCIAL STATEMENTS Combined financial statements and notes

Tax risks 5.3 Changes to the tax laws of countries where Groupama operates may have adverse consequences either on some Group products and reduce their attractiveness, especially those that currently receive favourable tax treatment, or on the Group’s tax 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 Tax Department is to provide information, monitor regulations, and advise and assist in the event of tax audits and disputes for all of the Group’s entities and with regard to the “corporate taxation” component. It is regularly approached about specific underwriting points and is involved in preparing the end-of-year financial statements. In this capacity, it ensures that the tax consolidation rules are applied (Article 223 A et seq. of the French general tax code) for the Group and, working with the Group accounting department, prepares the report on the tax position of the consolidated companies. It also helps to implement documentation and archiving procedures in 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. In addition, the Group Tax Department coordinates, in a Steering Committee, the implementation and monitoring of regulations on the automated exchange of tax data, in particular resulting from the American FATCA (Foreign Account Tax Compliance Act) regulations and the transposition of the European DAC (Directive for Administrative Cooperation). Lastly, as regards transfer pricing, it performs an annual update of the Master File meeting the new French requirements under the OECD standards and sends its English version to all international subsidiaries. The Group’s tax situation in France is also marked by the tax partnership between Groupama and DGFIP, since the signing of an agreement on 26 June 2019 with the SPE (Service Partenaire des Entreprises), which constituted a major step in the evolution of the Group’s tax management and is now an essential component of its tax policy. With regard to the tax news in France, it should be noted in particular that the trajectory of the reduction of the corporate tax rate, i.e. 25% excluding the additional contribution applicable from 2022, was confirmed in the French 2022 finance law, without including other significant measures for companies. In addition, the project relating to a “global minimum tax” under discussion within the OECD is being monitored by the Group Tax Department, which does not anticipate any adverse effects for the Group at this stage of the very complex plan. Groupama generally remains vigilant on the future interpretations or developments of the tax systems in the countries in which it operates that could lead to an increase in tax expenditures, generate compliance costs, or adversely affect the Group’s activity, cash position, and net income.

the Legal Department manages regulatory compliance and ❯ Group coordination as regards anti-money laundering and combating the financing of terrorism (AML/CFT). Entities implement applicable regulatory provisions and professional guidance in those of their procedures relevant to this field. The key points of the procedure include categorisation of the risks of money laundering and the financing of terrorism, collecting information on customers and the sources of their funds on the basis of the size of the risk, an automated detection system for people on asset-freeze lists and politically-exposed persons, a CRM profiling system for life/savings business activities, and a permanent and periodic control mechanism to check procedures are followed properly. An anti-money laundering and combating the financing of terrorism organisational policy defines the roles and responsibilities of the various participants and stakeholders at Group level and at each operational entity concerned, describes the mechanism in place with respect to informing and training employees, determines the methods and conditions for exchanging information required for due diligence, and specifies the procedure to be followed for control and risk monitoring. The Group Compliance Department, in conjunction with a network of Managers in AML/CFT in insurance subsidiaries in France and internationally, Asset Managers and the regional mutuals, ensure the Group is meeting its obligations in this respect; with regard to the protection of medical data, Group ❯ recommendations are disseminated by the Groupama Assurances Mutuelles business division concerned or entity concerned. It is the responsibility of the various Group entities (regional mutuals and subsidiaries) to implement these recommendations, in partnership with medical advisers and the Group Data Protection Officer (DPO), and the Claims unit of the Group Insurance and Services Department; as regards the protection of customers, the key compliance role ❯ at Groupama Assurances Mutuelles helps with operational implementation of several issues, including: ACPR instruction 2015-I-22 of 2 October 2015 on the ■ questionnaire about commercial practices and protection of customers, various ACPR recommendations, ■ monitoring of the major Group risk of “failure to advise”, ■ application of the Insurance Distribution Directive, which also ■ includes product governance, the prevention and management of conflicts of interest, compensation of distribution networks, and professionalism and CPD, the ongoing enhancement of the permanent control system, ■ monitoring and implementation of action plans to improve ■ marketing measures (OAV); as regards combating corruption and trading in influence (or ❯ influence peddling) (as per France’s Sapin 2 law) the key function of Compliance Manager at Groupama Assurances Mutuelles leads various operational implementation projects.

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Universal Registration Document 2021 - GROUPAMA ASSURANCES MUTUELLES