ANALYSIS
FATCA Intergovernmental Agreements Finalized or
“Agreed in Substance”
with European Countries as of January 2015
to sign intergovernmental agreements (IGAs) with the United States
to become FATCA-compliant. These
agreements include:
1. Model 1A IGA – a reciprocal agreement (meaning that U.S. institutions
also share information they gather
about the partner country’s taxpayer
activities in the United States) according to which the other country’s
financial institutions report all FATCArelated information to their own governmental agencies, which will then
report FATCA-related information to
the IRS;
2. Model 1A IGA – same as above, but
without reciprocity;
3. Model 2 IGA – the other country’s
financial institutions report directly
the IRS and the partner country
agrees to eliminate legal barriers to
carrying out FATCA reporting.
Map created by AmCham Macedonia based on U.S. Treasury Department data published as of January 12, 2015 at http://www.treasury.gov/resource-center/tax-policy/treaties/Pages/FATCA-Archive.aspx, Map creation tool: http://philarcher.org/
diary/2013/euromap/.
International Implementation
FATCA in Macedonia
Macedonia is one of the few European countries
that has yet to conclude or agree in substance on
FATCA (others in southeastern Europe include Albania and Bosnia and Herzegovina). While all financial
institutions in the country have already taken measures to comply with these reporting requirements,
the country maintains laws which make such reporting unnecessarily difficult or even illegal. So far,
the Macedonian Government has not
taken any public stance on FATCA.
In the beginning, FATCA’s international implementation faced certain legal difficulties. These legal
hurdles were particularly related to the transfer of
personal data (which is strictly regulated in most
jurisdictions). Due to the complexity of the Act, the
Treasury Department delayed FATCA’s implementation twice. FATCA is now expected to be fully applied
in 2015. It should also be noted that in
May of 2014 the IRS announced that
FATCA is now expected
FATCA’s enforcement would be relaxed
for the law’s first two years as long as to be fully applied
the institutions make a “good faith in 2015. It should
also be noted that in
effort” toward compliance.
Nevertheless, FATCA’s implementation is quickly gathering pace. A
large number of countries (including
all of the G7 countries) have already
signed or have agreed in substance
Emerging Macedonia Winter 2015 Issue 44
In Europe, virtually all countries have
either finalized agreements or signed
“agreements in substance”, shown in
green in the map above.
May of 2014 the IRS
announced that FATCA’s
enforcement would be
relaxed for the law’s
first two years ...
However, FATCA compliance is a matter of when, not if. Therefore, it makes
no sense for Macedonia to remain
without an IGA with the United States
on FATCA. The lack of an IGA will be
a negative signal to the global financial and business community and thus
can do nothing but harm government
efforts to attract FDI.
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