SI. 44 of 2015 – Mutual Legal Assistance (Tax Matters) Order, 2015

Summary

This Order brings into effect the BVI-US FATCA Intergovernmental Agreement by giving operative force to section 3A of the Mutual Legal Assistance (Tax Matters) Act, 2003. It sets out the due diligence, registration, reporting, record-keeping and inspection obligations that Financial Institutions in the Virgin Islands must follow to comply with FATCA and the underlying Agreement.

• Due diligence: Financial Institutions must establish and maintain arrangements to identify US reportable accounts and accounts held by Nonparticipating Financial Institutions, applying the due diligence procedures in Annex I of the Agreement (or, as an alternative, relevant US Treasury Regulations, by election to the Competent Authority).
• Registration: Reporting Financial Institutions must register on the IRS FATCA registration website to obtain a Global Intermediary Identification Number (GIIN), and separately register with the BVI Competent Authority.
• Annual reporting: Reporting Financial Institutions must prepare and submit required account information to the Competent Authority each year, including modified information for Nonparticipating Financial Institutions for 2015 and 2016.
• TIN collection: Institutions must obtain and report the US taxpayer identifying number (TIN) of US specified persons holding reportable accounts, phased in from 1 July 2014 for new accounts and 1 January 2017 for pre-existing accounts.
• Notification of changes: Institutions must immediately notify the Competent Authority of any change to registration details, including the primary point of contact.
• Third-party agents: A Financial Institution may appoint an agent to perform its FATCA duties, but remains responsible for that agent's failures and must retain access to underlying records.
• Inspection and record retention: Institutions must produce information and records on request by the Competent Authority, bring offshore-held records into the BVI when required, and retain all relevant books and records for six years.
• Penalties: Breach of obligations created under this Order attracts the general penalty under section 21 of the principal Act.

The Order applies to all Financial Institutions and Reporting Financial Institutions operating in the Virgin Islands that hold or report on US reportable accounts under the FATCA Agreement, and the Competent Authority may issue further guidance to aid compliance.

Key obligations

• Establish and maintain arrangements to identify US reportable accounts and accounts held by Nonparticipating Financial Institutions using Annex I due diligence procedures (or an elected US Treasury Regulations alternative).
• Retain evidence and records of due diligence steps for six years from the end of the year in which the arrangements applied.
• Register on the IRS FATCA website and obtain a GIIN, which must be included in reported information.
• Register with the BVI Competent Authority to submit required FATCA information, and notify the Competent Authority of the reporting obligation.
• Submit required account information to the Competent Authority annually, with 2014 information due by 30 June 2015 and subsequent years due by 31 May.
• Obtain and report US TINs for US specified persons holding reportable accounts (from 1 July 2014 for new accounts; from 1 January 2017 for pre-existing accounts).
• Notify the Competent Authority immediately of any change to registration information or primary point of contact.
• Where an agent is appointed to perform FATCA duties, maintain access to and be able to produce records used to identify and report on reportable accounts, and remain responsible for the agent's compliance failures.
• Provide or make available information, books, documents and records to the Competent Authority within the time it specifies, including bringing offshore-held information into the BVI when required.
• Retain all books, documents and records relating to reported information for six years.

Applies to

Financial Institutions, Reporting Financial Institutions

Deadlines

• 30th June, 2015: Deadline to submit required FATCA information to the Competent Authority for reporting year 2014.
• 31st May: Annual deadline for submitting required FATCA information to the Competent Authority for all years after 2014.
• 1st June, 2015: Deadline for Financial Institutions submitting information in 2015 to register with the Competent Authority.
• 1st April in the first calendar year of reporting obligation: Deadline for Financial Institutions in subsequent years to register with the Competent Authority.
• 1st July, 2014: Start date from which TINs must be obtained and reported for new accounts opened on or after this date.
• 1st January, 2017: Start date from which TINs must be obtained and reported for pre-existing accounts.

Related documents

• This document commences Mutual Legal Assistance (Tax Matters) Act, 2003 (No. 18 of 2003)