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

Summary

This is the bilateral Competent Authority Agreement (CAA) between the Cayman Islands and the United Kingdom establishing the legal and operational framework for automatic exchange of financial account information under the Common Reporting Standard (CRS). It was signed in Paris on 22 September 2016 by the Cayman Islands Tax Information Authority and HM Revenue and Customs, and is made pursuant to Paragraph 13 of the 2010 Cayman Islands-UK Double Taxation Arrangement.

The agreement sets out which account information Cayman Islands Reporting Financial Institutions must have reported to the Cayman Islands Competent Authority for onward automatic exchange with the UK, including account holder identification details, TINs, account balances, and income/proceeds information for Custodial, Depository and other accounts.

• Exchange cycle: Specifies the annual exchange cycle.
• Data format: Specifies the data format (CRS schema in XML).
• Confidentiality and safeguards: Specifies confidentiality and data safeguard requirements.
• Compliance mechanism: Specifies a compliance/error-notification mechanism between the two Competent Authorities.
• Agreement provisions: Includes provisions on suspension, termination and amendment of the agreement.

This document itself is an intergovernmental/Competent Authority-to-Competent Authority instrument rather than a directly binding rule on private financial institutions; it operationalizes CRS reporting obligations that are separately imposed on Cayman Islands financial institutions under Cayman's domestic CRS regulations/legislation. It is primarily useful for compliance officers as background on the legal basis and mechanics of UK-bound CRS exchanges, rather than as a source of new direct obligations on institutions beyond what domestic CRS rules already require.

Key obligations

• The Cayman Islands Competent Authority will annually exchange with the UK Competent Authority, on an automatic basis, CRS information regarding UK Reportable Accounts obtained under Cayman's domestic reporting and due diligence rules.
• Information exchange is to commence from the year 2017 and occur within nine months after the end of the calendar year to which the information relates, subject to dates specified in notifications under Section 7.
• The Cayman Islands Competent Authority must exchange the specified information using the CRS schema in Extensible Markup Language.
• Upon notification from the UK Competent Authority of suspected errors or non-compliance by a Reporting Financial Institution, the Cayman Islands Competent Authority must take all appropriate measures under its domestic law to address the errors or non-compliance.
• Each Competent Authority must notify the other promptly of any subsequent changes to the notifications required under Section 7 (e.g., changes to laws, effective dates, data transmission methods, or data protection safeguards).
• The UK Competent Authority must notify the Cayman Islands Competent Authority immediately of any breach of confidentiality or failure of safeguards, and of any resulting sanctions or remedial actions.
• All exchanged information must be kept confidential and used only in accordance with the safeguards and use-limitations specified in the DTA and in notifications under Section 7.

Applies to

Cayman Islands Financial Institutions, Reporting Financial Institutions

Deadlines

• commencing from the year 2017, within nine months after the end of the calendar year to which the information relates: Timing for the Cayman Islands Competent Authority to exchange CRS information under Section 2 with the UK Competent Authority.
• 22 September 2016: Date the Agreement was signed in Paris by the Cayman Islands and UK Competent Authorities.
• effective on the date of the latest of the notifications described in Section 7(1)(a)-(c): Entry into effect of the Agreement, contingent on notifications confirming CRS laws, data transmission methods, and confidentiality/data protection safeguards.
• 12 months after the date of a notice of termination, effective the first day of the following month: Period before termination of the Agreement takes effect once a Competent Authority gives notice of termination.