Worldwide: Privacy: What's Left?

A seismic change in the international private wealth arena is under way. Over 90 jurisdictions have committed to automatically exchange comprehensive financial information on an annual basis under the OECD's Common Reporting Standard (CRS). The CRS will start in 2016 in over 55 jurisdictions.

This article comments on the CRS and, in particular, on certain practical implications arising from the CRS for private wealth and estate planning. We also summarise other international developments on transparency. These developments, together with the CRS and FATCA, have resulted in the triumph of transparency over privacy as the emerging global standard.

UK Public Registers

Legislation providing for a public register of beneficial owners of UK companies received royal assent on March 26, 2015. Commencing in April 2016 self-reported data on the ultimate individual owner and controlling persons for private UK companies will appear in the Companies House register and will be available for government and public (including media) access.

Offshore Central Registers?

The UK is demanding that its Crown Dependencies and Overseas Territories similarly adopt central registers of corporate beneficial owners available to tax authorities and law enforcement.

EU Central Registers

The EU adopted the 4th Anti-Money Laundering Directive on May 20, 2015. The directive requires central registers of beneficial owners of legal entities. Public access will be permitted for those who can show "legitimate interest" (e.g., potentially including the media). Trusts are also included where the trust generates local tax consequences, though there are no provisions for public access. EU Member States have two years to implement the directive in national law.

Public Registers of Directors

The Financial Action Task Force (FATF) published new guidance on transparency and beneficial ownership on October 27, 2014. This requires countries to ensure that basic information on companies is obtained and recorded by the company registry, including a public register of company directors.

OECD Common Reporting Standard

Objectives and Obligations

The FATCA-inspired CRS is designed to tackle international tax evasion by establishing the annual automatic transmission of bulk taxpayer information. Financial institutions are required to (i) conduct due diligence on financial accounts to identify account holders who are tax resident in participating jurisdictions; and (ii) report information on these accounts to their domestic tax authority which will then automatically transmit that information directly to the tax authorities of participating jurisdictions where account holders are tax resident.


51 "early adopter" jurisdictions signed a Multilateral Competent Authority Agreement in October 2014. Some 40 other countries have also undertaken to adopt the CRS. Financial institutions will need to identify account holders in over 90 countries, not simply US persons in the context of FATCA.

2016 Start Date for CRS

Financial institutions in early adopter jurisdictions will need to begin tracking accounts from January 1, 2016 and exchanging information on those accounts beginning in 2017. Other participating countries will join a year later, tracking accounts from 2017 and exchanging information on those accounts from 2018. A list of participating jurisdictions and their start date is available on the OECD's website.

Broad Application

The CRS applies to a broad range of financial institutions (e.g. banks, custodians, brokers, certain collective investment vehicles and insurance companies). Trusts, companies, partnerships and foundations may be investment entities and therefore financial institutions if managed by a professional trustee or service provider. The financial information to be reported is unprecedented in breadth and includes taxpayer identification numbers (TIN), account balances (or values) and sales proceeds from financial assets. Disclosure of account balances goes beyond the information required on domestic tax returns in most countries, which are normally designed to disclose income and capital gains to determine taxable income. The CRS also requires looking through passive non-financial entities to report on the individuals that ultimately control these entities.

Cross-Border Application

The CRS is designed to raise tax revenue arising in foreign structures. It is not aimed at domestic structures.

What is a Financial Account?

A financial account includes equity or debt interests in investment entities. Professionally managed trusts, personal holding companies, foundations and partnerships may be investment entities. The shares of a company or a partner's interest in a partnership are financial accounts for the shareholder and partner, respectively. Similarly, settlors, beneficiaries and other individuals exercising ultimate effective control over a trust (or foundation) are treated as having a financial account in the trust (or foundation). However, a discretionary beneficiary will only be treated as having a financial account in a trust if the beneficiary receives a distribution in the calendar year (see paragraph 70 of the OECD's Commentary on Section VIII of the CRS).

What should clients do?

  1. Clients should review their wealth structures to consider the scope of information that will be automatically disclosed to their home country and whether that information can be limited.
  2. Clients should be responsive to due diligence requests from their bank. If a bank has conflicting information suggesting that a client resides in two jurisdictions and is unable to confirm a single jurisdiction of tax residence, the bank may be required to disclose information to both jurisdictions (through their tax authority).
  3. Clients should proactively regularize non-compliant arrangements including through amnesties and disclosure programs. This will likely be more favorable than being audited.
  4. Clients should confirm the tax efficiency of, and reporting obligations in respect of, their wealth structure.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.