The Cruise Line Industry Association, of which Royal Caribbean is a member, has noted that the strategic or commercial management test is subjective and possibly difficult to satisfy and has requested that the OECD provide some safe harbors. However, this exclusion doesn’t apply unless the entity demonstrates that the strategic or commercial management of all ships concerned is effectively carried on from within the country where the constituent entity is located.

Its annualized financial accounting revenue in the first half of 2022 was $6 billion.Īrticle 3.3 of OECD Pillar Two generally excludes the international shipping income of constituent entities from the Pillar Two tax base. In addition to its Miami headquarters, Royal Caribbean has offices throughout the world to administer its operations.

Royal Caribbean operates ships on various voyages between two foreign ports, and between US ports and foreign ports, with approximately 1,000 destinations on all seven continents. However, the pending OECD Pillar Two rules, which are designed to apply to a multinational corporate group whose annual revenues exceed 750 million euros, present these cruise lines with other challenges. and other foreign-parented cruise lines even if they have cruises between US and foreign ports, due to Section 56A(c)(4)’s application of the principles of Section 882. Part 1 of this article concluded that the US corporate alternative minimum tax might be avoidable by Royal Caribbean Cruises Ltd.

Workers comp statistics cruise line