On 29 October 2014, 51 countries formally signalled their commitment to the Common Reporting Standard ("CRS") by signing a multilateral competent authority agreement to automatically exchange information based on Article 6 of the OECD's Convention on Mutual Administrative Assistance in Tax Matters.

The significance of this event was demonstrated by the participation of 39 ministers (including those from the Isle of Man, Cayman Islands, Jersey, BVI, Gibraltar, Malta) in the signing ceremony, the largest gathering of ministers to take joint action to address tax evasion.

The competent authority agreement is a multilateral framework agreement, with the subsequent bilateral exchanges coming into effect between those signatories that file the subsequent notifications under Section 7 of the agreement.

The agreement specifies the details of what information will be exchanged and when, as set out in the CRS.

The Isle of Man has committed to delivering its first information exchange under this new regime by September 2017, a move mirrored by the other major offshore financial centres.

Automatic exchange of information also on its way for the EU

Earlier this month, EU finance ministers agreed to revise the Administrative Cooperation Directive, with the effect that full automatic exchange of information will be required for EU Member States by 2017.

The amendment to the Directive, which brings into effect the requirements of the OECD's CRS, will see information being automatically exchanged on interest, dividends and other

income as well as account balances and sales proceeds from financial assets. It will also see plans to amend the EU Savings Tax Directive (EUSD) being shelved and indeed the likely repeal of the EUSD.

The amendment has been welcomed by various EU bodies as a standard setter for EU Member States and international partners in relation to tax transparency.

DQ's Expertise

DQ is a leading law firm based in the Isle of Man advising on Isle of Man and BVI law. It has a specialist team with extensive experience of advising clients in relation to international tax, securities and criminal investigations, TIEA requests and multi-jurisdiction insolvencies in the Isle of Man and the BVI.

For more information on BVI investigations or disclosure requests, please contact head of DQ's BVI law practice, Stephen Dougherty.

To discuss any element of your procedures or arrangements for automatic exchange of information compliance, including FATCA and CRS, please contact DQ's head of regulatory & compliance services, Sinead O'Connor.

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.