Bringing you live news and features since 2006 

EFAMA Peter de Proft

EFAMA comments on US Treasury and IRS proposed regulations for FATCA implementation


EFAMA has commented on the the US Treasury Department and Internal Revenue Service’s long-awaited proposed regulations under the Foreign Account Tax Compliance Act (FATCA), which were released on 8 February, 2012   

FATCA is a sweeping law that requires non-US financial institutions, including funds, to determine which of their accounts and investors are US persons, and to report such US persons to the IRS.  The consequence of non-compliance is a 30 per cent withholding tax on payments of certain US source income.
“We are gratified that the proposed regulations reflect the receptiveness of the US rule makers to working with EFAMA to develop operating rules under FATCA that are sensitive to the concerns and the needs of the European funds industry,” says EFAMA’s statement. “We have had extensive dialog with the US Treasury and IRS with the shared goal of making the application of these rules workable for the funds industry.  In particular, the proposed regulations are responsive to how European funds are structured and to the practical business realities of how funds operate. Most importantly, the proposed regulations build on EFAMA’s proposals to treat many funds and their distributors as deemed compliant where they present a low risk of being a vehicle for US tax evasion.”
On the same day the proposed regulations were issued, the United States, along with the governments of France, Germany, Italy, Spain, and the United Kingdom, released a joint statement announcing a possible framework for intergovernmental agreements pursuant to which financial institutions would report the information required by FATCA to their local authorities, rather than directly to the IRS. Such agreements would be designed to solve local law privacy restrictions on providing information directly to U.S. tax authorities. EFAMA is hopeful that this approach will be expanded beyond the five countries that have been included in the joint statement.
Peter de Proft, Director General of EFAMA, says: “Although the proposed regulations address many of the difficulties faced by the funds industry, we hope that the regulations will be further refined as the U.S. Treasury and IRS continue the process of moving toward final regulations.  EFAMA will continue its dialog with the U.S. government to ensure that the final regulations address the remaining issues of relevance to the European funds industry.”

Latest News

REX Shares has announced a strategic reorganisation that integrates its REX Shares, MicroSectors, and T-REX products, as well as REX..
Allspring Global Investments writes that as it builds an investment platform for the future, it has filed for exemptive relief..
LSEG Lipper writes that ETF promoters in Europe enjoyed estimated net inflows (+EUR25.1 billion) for May 2024...
The European Fund and Asset Management Association (EFAMA) has published its 2024 industry Fact Book, which includes a foreword by..

Related Articles

Marcus Wayerer, Franklin Templeton
Franklin Templeton says that emerging markets are navigating a tricky environment at the moment, due to factors such as the...
Matt Barry, Touchstone Investments
Back in 2022, Cincinnati, Ohio-based Touchstone Investments launched its first four ETFs, having previously been predominantly a mutual fund company....
CN Tower, Toronto
The winners were announced in the second ETF Express Canadian awards at the event held at The Quay in Toronto,...
Darren Jordan, Komainu
Custody specialist, Komainu, was launched in 2018 as a joint venture between Nomura, digital-asset investment manager, CoinShares and blockchain business,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by