Hong Kong and Barbados Sign FATCA IGAs with United States

The Hong Kong Special Administrative Region of the People's Republic of China ("HKSAR") signed a Model 2 Intergovernmental Agreement to Implement FATCA ("IGA") with the United States on November 13, 2014. Under the terms of the IGA, the HKSAR will direct all Financial Institutions residing in Hong Kong to register with the U.S. IRS and agree to the terms of a Foreign Financial Institution ("FFI") Agreement with respect to due diligence, reporting and withholding.

Hong Kong financial institutions must obtain the consent of holders of new accounts that are identified as U.S. account holders to disclose account information directly to the IRS. Annex II of the IGA excludes certain employee savings accounts from FATCA reporting. Although China has agreed in substance to the terms of a Model 1 IGA, the agreement has not yet been signed.

Separately, Barbados announced that it has signed a Model 1 IGA with the United States. The text of that agreement has not yet been released.

See: FACTA Agreement between Hong Kong and United States.