FATCA IGAs Signed with Cayman Islands and Costa Rica

The U.S. Department of Treasury announced on Friday, November 29th, that it had signed Intergovernmental Agreements ("IGAs") to implement FATCA with the Cayman Islands and Costa Rica. The United States and the Cayman Islands also signed a new Tax Information Exchange Agreement ("TIEA") to replace a 2001 TIEA between the two countries. The Costa Rican IGA is a Model 1A reciprocal agreement whereby both the United States and Costa Rica agree to exchange information with respect to accounts maintained in their respective countries that are held or owned directly or indirectly by residents of the other country. The Cayman Islands' IGA is based on the most recent Model 1B IGA (non-reciprocal). Under this agreement, financial institutions organized under the laws of the Cayman Islands will be required to report certain information about accounts maintained by such institutions and interest in such institutions to the Cayman Islands which will automatically transfer such information to the U.S. IRS. The Cayman Islands' IGA will become effective upon the latter of (i) notification by the Cayman Islands to the United States that it has completed all internal procedures for entry into force of the agreement, and (ii) entry into force on the new TIEA. The Costa Rican IGA will become effective upon Costa Rica's notification to the United States that all internal approval procedures have been completed.

With the signing of these two IGAs, the United States has now signed 12 FATCA IGAs.

Copies of the Costa Rican IGA, the Cayman Islands IGA and the new TIEA between the United States and the Cayman Islands are linked below.

See: FATCA Agreement with Costa Rica; Final FATCA Agreement with Cayman Islands; November FATCA Agreement with Cayman Islands.See generally: Cadwalader's Guide to FATCA by Dan Mulcahy, Mark Howe and Steven Lofchie.