The CESOP Directive (Council Directive (EU) 2020/284) is coming into effect on 1 January 2024 and will require payment service providers (PSPs) located in the EU to collate electronic records on cross-border payments and report this data to relevant tax authorities in the EU. The Directive will create additional administrative requirements for PSPs located in the EU. The EU will establish a new central electronic system of payment information (CESOP) to facilitate the reporting and store the payment information. The aim is to address VAT leakage and fraud in the EU, where the VAT gap (i.e. the difference between expected VAT receipts and amounts actually collected) was €93m in 2020. The reporting requirements will allow EU tax authorities to monitor payments made in respect of e-commerce transactions to ensure that they are taxed appropriately. The data collected in this central EU database will be made available to anti-fraud experts in the Member States via the Eurofisc network.