AEoI Flash: new CRS FAQs
The CRS implementing legislation requires that the CRS must be applied consistently with the CRS Commentary. The OECD also published Frequently Asked Questions (FAQs) and an Implementation Handbook to assist in understanding CRS obligations. Both must be considered as secondary to the (e.g. Swiss) legislation. Recently the OECD published updated FAQs (December 2017), such as:
- Reporting Obligations of Reporting Financial Institution that is in the process of being liquidated
- Timing of Self - Certifications
- Determining Controlling Persons of Entity
- Excluded Accounts – Accounts held for the purpose of condominium or housing cooperative
- Indirect distribution by a trust
What are the reporting obligations of a Swiss reporting FI (RFI) that is in the process of being liquidated? The answer cannot be found in the AIAG, AIAV or the Swiss AIA guidelines, but are listed in the latest OECD FAQ (December 2017), Section I, No. 11, “Reporting Obligations of the Reporting FI that is in the process of being liquidated”. Basically it is a question of the reportable account, and a bilateral agreement is mandatory. If this is not the case, reporting is not possible and the question of the registration of the RFI is obsolete. If a bilateral agreement has been concluded, any liquidation and activities up to the liquidation of the account must be reported, which can only be done by an FI. From this follows that an FI (in liquidation) or the liquidated FI must register on the Swiss AIA platform for the reporting. If such FIs do not register, they violate frustration clauses and sanctions can be imposed.