The UAE, represented by the Ministry of Finance (MoF) announced the signing of the agreement to facilitate the implementation of FATCA. Younis Haji Al Khoori, Undersecretary of MoF, and Barbara A. Lead, the US Ambassador to the UAE, signed the agreement at the Ministry’s premises in Abu Dhabi.
The undersecretary of MoF, Younis Haji Al Khoori, commented that “the country was keen to sign this agreement to protect UAE financial institutions”.
Under FATCA and as per the law, all financial institutions in the UAE will be required to provide annual reports and disclose information about financial accounts held by US citizens and companies who have US shareholders with a stake of 10%. The reports are required to be submitted directly to the US Treasury. The agreement exempts certain government institutions, sovereign funds and international organisations from the reporting requirements.
Al Jhoori added: “In the case of non-compliance with the requirements of Fatca, any non-US financial organisation could face a 30 per cent penalty on certain financial returns of its operations in the US market."
"The Ministry will continue to meet all necessary requirements for linking UAE government financial institution systems to the Fatca e-system.”
FATCA helps build up transparency and is expected to impact companies which are not in the financial services sector, both in and outside the US. Ambassador Leaf commented, “Fatca is becoming the global standard in the effort to curtail tax evasion.
“This agreement reflects the UAE's commitment to the adoption of best practices as well as the growing strength and breadth of our bilateral relationship."
According to the provisions of the intergovernmental agreement, the first report (for 2014), must be submitted to the United States by September 30, 2015.
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