Hong Kong Joins FATCA IGA Party

U.S. Treasury Department ("Treasury") officials announced that Hong Kong has agreed in substance to the terms of an Intergovernmental Agreement ("IGA") implementing FATCA. Hong Kong will adopt a Model 2 type IGA, which will require Hong Kong Financial Institutions to report account information on accounts held directly or indirectly by U.S. persons to the U.S. IRS. The text of the IGA will be made available at the time of its formal execution by the two countries. Hong Kong and the United States recently signed a Tax Information Exchange Agreement setting the stage for this IGA.

Hong Kong is the sixth country to adopt a Model 2 style IGA (Japan, Switzerland, Austria, Chile and Bermuda are the others). However, a Treasury official indicated at a recent ABA tax conference that there would soon be a number of in-substance Model 2 agreements being announced.

See also: Cabinet FATCA Materials (for Cabinet subscribers only).For more information, please contact Daniel Mulcahy and Mark Howe.