AEOI Updates: June 5-19, 2017

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

OECD Gets First Results from Disclosure Facility

Last month, the OECD launched its public disclosure facility for interested parties to submit potential schemes they believe are being used to circumvent the Common Reporting Standard. The facility’s goal is to understand these schemes or loopholes to further strengthen CRS’s effectiveness in promoting greater transparency. Within a month, the OECD had received several submissions relating to a so-called “Occupational Retirement Scheme” employed in Hong Kong.  In response, the Inland Revenue Department of Hong Kong issued guidance in order to address the use proper use of the ORS.

Pakistan Signs Multilateral Competent Authority Agreement

Pakistan’s Ministry of Finance has joined the Common Reporting Standard, signing on to the Multilateral Competent Authority Agreement (MCAA). This development brings the total number of signatories to 90 countries. As such, Pakistan will aim to begin the Automatic Exchange of Information (AEOI) for its reportable accounts in 2018.

By signing on to this agreement, Pakistan commits to the implementation of the Standard for Automatic Exchange of Financial Account Information for all Financial Institutions within its jurisdiction.

Guatemala Ratifies the Convention on Mutual Administrative Assistance in Tax Matters

The Guatemalan government has adopted the Convention on Mutual Administrative Assistance in Tax Matters in a move to demonstrate its commitment to tax transparency and remove itself from a “blacklist” of international tax havens.

Once it takes the necessary legislative steps to implement the OECD programs, Guatemala will be able to exchange information with any of the 110 partner jurisdictions that have also adopted the Convention – including those engaged in the Common Reporting Standard. The Convention provides the foundation for Guatemala to enter into bilateral negotiations and agreements with other AEOI countries.

Cyprus Opens Data Transmission Portal and Releases FATCA Specifications

The Cypriot Ministry of Finance has announced that its Government Internet Security Channel is now open for the acceptance of FATCA and CRS XML files containing tax year 2016 data. Read the full post on the Sovos Regulatory Feed.

Hong Kong Publishes Instructions for Occupational Retirement Schemes (ORS)

In response to the submissions made through the OECD disclosure facility, Hong Kong’s Inland Revenue Department has published guidance for the use of Occupational Retirement Schemes. In part, the guidance instructs that only those schemes registered under the proper ordinance are considered non-reporting financial institutions.