AEOI Updates: Dec. 19 – Jan 6, 2017

Automatic Exchange of Information (AEOI) legislation is constantly evolving worldwide as the standard is rolled out around the world. The Sovos research team continually monitors new regulations and updates across the globe and publishes them in our Taxport Compass tool. Here are some important changes that occurred in recent weeks:

UK Updates Schema Guidance

HMRC posted an updated guide to its AEOI schema on Dec. 28 to provide important clarifications and announce alterations. Some of the new changes include validations for IBAN & ISIN account numbers, more guidance on prohibited characters, clarifications for several elements in Account Data, Holder Info, Holder Tax Info, and Birth Info.

New Zealand Releases Draft CRS Guidance

New Zealand’s Inland Revenue published its draft guidance for CRS, which provides detailed information on identifying financial accounts and defines which institutions are subject to CRS. The guidance also indicates that New Zealand will allow for third-party service providers; has adopted the wider approach for due diligence and will allow the wider approach for reporting; and Inland Revenue will not require nil reports. The guidance also notes that Inland Revenue is still deciding on a filing format for financial institutions to use for reporting.

France Publishes CRS Legislation

France published its legislation in its official Gazette. The law, entitled Decree No. 2016-1683, establishes reporting and due diligence obligations for French financial institutions. France is an early adopter and will require reporting next July 31, the same date as its FATCA reporting due date. France is also allowing third parties to file on the behalf of financial institutions.

Mexico Releases CRS Guidance Documents

Mexico recently released a number of guidance documents for CRS. The Modification to Annex 25 Under the RMF Act of 2016 provides due diligence guidance relating to CRS reporting. Mexico has also released its CRS XML user guide providing specification on reporting through CRS. Finally, Mexico recently published a list of jurisdictions with whom it is participating in reciprocal reporting under CRS.

Brazil Publishes CRS Legislation

Brazil recently published its CRS legislation, which establishes the requirements for Brazilian financial institutions to perform due diligence based on the OECD’s Common Reporting Standard. Brazil will require financial institutions to transmit information on Reportable Accounts on both Feb. 28 and Aug. 31. Brazil is a late adopter jurisdiction, so financial institutions will begin due diligence next year and report in 2018.

Taiwan Signs Model 2 IGA

This morning the Treasury Department posted its IGA with Taiwan. The IGA is a Model 2. This will require Taiwanese Financial Institutions to agree to the terms of the FFI Agreement and report U.S. reportable accounts by March 31, and Non-Participating Financial Institutions by March 15.

Cayman Islands Amends CRS Regulations

The Cayman Islands has amended its TIA Regulations for CRS. Many of the amendments alter the language from previous TIA regulations. The new amendments do require Cayman financial institutions to register by April 30, 2017. Cayman is also now requiring nil returns for CRS returns. (Please note, there is still no requirement to submit a nil return for FATCA reporting, pending further regulations). Finally, beginning on page 11, the regulations lay out several provisions related towards penalties.