Tax authorities from 51 jurisdictions have signed a multilateral competent authority agreement, laying the groundwork for automatic exchange of financial account information under the OECD/G-20 Common Reporting Standard beginning 2017.
The multilateral agreement signed October 29 at the OECD’s 7th Global Forum on Transparency and Exchange of Information for Tax Purposes in Berlin, puts into effect Article 6 of the Multilateral Convention on Mutual Administrative Assistance in Tax Matters.
The agreement adopts the Common Reporting Standard for automatic exchange of information, presented by the OECD to G20 finance ministers during their meeting in Cairns last September. The standard provides for automatic exchange of financial information — including account balances, interest payments, and beneficial ownership — on an annual basis.
Forty-eight countries that signed the agreement pledged to work towards launching automatic information exchange by September 2017, while three countries agreed to begin in 2018.
Jennifer Sponzilli, a principal with KPMG’s U.S. international tax team in the U.K said that now that the multilateral agreement has been signed, “there will be a race against the clock for both governments and financial institutions to meet the ambitious timelines.”
“Governments will likely need to enact legislation or regulations to effectuate the Multilateral Competent Authority Agreement in their jurisdictions. Financial institutions will be working hard to get customer due-diligence procedures in place by January 1, 2016 – less than 15 months from now – and then will turn to meet the deadline for the first reporting of information about nonresident account holders required in 2017,” Sponzilli said.
Global Forum participants also agreed to modify the standard for exchange of information upon request by including the requirement that beneficial ownership of all legal entities be available to tax authorities and exchanged with treaty partners.
Also, the group decided increase support to developing nations to facilitate their participation in automatic exchange of information. The group is launching a series of pilot programs that will offer technical assistance, and also agreed to launch the “Africa Initiative” – a 3 year project to raise awareness and build the tools to foster effective exchange of information in Africa. The project will be led by African members of the Global Forum and the Chair, in collaboration with the African Tax Administration Forum, the OECD, the World Bank Group, and the Centre de Rencontres et d’Etudes des Dirigeants des Administrations Fiscales (CREDAF).
See:
- Multilateral competent authority agreement (341 KB)
- Signatories of the competent authority agreement and intended first information exchange date
- Global Forum -statement of outcomes
- OECD release
- Berlin declaration on transparency and fairness in tax matters (38.9 KB)
- Germany – Berlin Tax Conference 2014: fifty states call for greater transparency and fairness
- Germany – Global conference in Berlin: working together to fight tax evasion
- European Commission release
- Jersey release
- UK release
- Cayman Islands release
- Isle of Man release
- The Netherlands release
- Malta release
- Hungary release
- KPMG release
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Countries declare intent to implement OECD automatic information exchange standard
