Bilateral Competent Authority Agreement for the CRS between the Cayman Islands and Guernsey

Summary

This document is the bilateral Competent Authority Agreement (CAA) between the Cayman Islands and Guernsey for implementing the OECD Common Reporting Standard (CRS) for automatic exchange of financial account information. It is a government-to-government agreement made under Article 5A of the existing Cayman Islands-Guernsey Tax Information Exchange Agreement (TIEA), and sets out the scope, data elements, timing, confidentiality and enforcement framework for CRS exchanges between the two Competent Authorities (the Cayman Islands Tax Information Authority and Guernsey's Director of Income Tax).

The agreement is non-reciprocal: only the Cayman Islands Competent Authority will exchange information to Guernsey about Guernsey-resident account holders (and controlling persons of passive NFEs) identified by Cayman Islands Reporting Financial Institutions.

• Data reported: Identifying details, account numbers, balances, income and proceeds.
• Timing: Annual exchange within nine months of year-end, starting with 2016 data.
• Format: Requires use of the CRS XML schema.
• Notification obligations: Must be satisfied before exchange can commence.
• Confidentiality: Data-safeguard requirements apply.
• Compliance: A compliance-notification and suspension mechanism is established.
• Termination: The agreement includes termination provisions.

While the direct parties bound are the two Competent Authorities, the substantive effect is on Cayman Islands Financial Institutions (Reporting Financial Institutions), whose CRS reporting to the Cayman Islands DITC forms the basis of information transmitted to Guernsey under this agreement. The agreement does not itself impose new domestic reporting duties on institutions beyond what domestic CRS regulations require, but it confirms the legal channel and timing for cross-border exchange with Guernsey.

Key obligations

• The Cayman Islands Competent Authority will annually exchange with the Guernsey Competent Authority, on an automatic basis, the specified CRS information regarding Guernsey Reportable Accounts.
• Information must be exchanged within nine months after the end of the calendar year to which it relates, starting with information for 2016 and all subsequent years.
• The Cayman Islands Competent Authority must exchange information using the CRS schema in Extensible Markup Language (XML).
• The Cayman Islands Competent Authority must provide notification to Guernsey confirming it has the necessary laws in place to implement CRS, specifying effective dates for Preexisting and New Accounts and reporting/due diligence procedures, and specifying data transmission/encryption methods.
• The Guernsey Competent Authority must notify the Cayman Islands Competent Authority of any errors, incomplete reporting, or non-compliance by a Reporting Financial Institution, and the Cayman Islands Competent Authority must take appropriate measures under domestic law to address such issues.
• The Guernsey Competent Authority must notify the Cayman Islands Competent Authority immediately of any breach of confidentiality or failure of data safeguards, and of any resulting sanctions or remedial actions.
• Either Competent Authority may suspend exchange by written notice on grounds of significant non-compliance, effective immediately; either may terminate the Agreement by written notice, effective 12 months after the notice date.

Applies to

Cayman Islands Financial Institutions, Reporting Financial Institutions

Deadlines

• within nine months after the end of the calendar year: Deadline for the Cayman Islands Competent Authority to exchange CRS information with Guernsey for each relevant calendar year.
• 2016 and all subsequent years: First reporting period covered by the automatic exchange obligation under this Agreement.
• 12 months after the date of a notice of termination: Termination of the Agreement becomes effective on the first day of the month following expiration of this period after either party gives notice of termination.