Monaco Takes Steps to Enhance Tax Transparency through Compliance Reporting
The Principality of Monaco has strengthened its commitment to international tax transparency by signing three key conventions, solidifying its position as a responsible player in the global financial landscape.
Key Conventions Signed
- Convention on Mutual Administrative Assistance in Tax Matters (MAAC OECD): This convention aims to promote cooperation and exchange information between countries to combat tax evasion.
- Multilateral Competent Authority Agreement concerning the Automatic Exchange of Financial Account Information (MCAA OECD): This agreement facilitates the automatic exchange of financial account information between countries, promoting transparency and compliance.
- Protocol amending the Agreement between the European Community and the Principality of Monaco: This protocol updates the existing agreement between Monaco and the European Union to ensure alignment with international standards.
Ratification and Implementation
Monaco has ratified these agreements and incorporated their provisions into local law, including the Common Reporting Standard (CRS). The adoption of these texts took effect on January 1, 2017, making automatic exchange of tax information mandatory for Monaco-based financial institutions.
Automatic Exchange of Information
As a result, the first round of automatic exchanges was completed by June 30, 2018, covering data from 2017. Subsequent exchanges have continued annually, with Monaco now participating in the international movement for transparency and tax compliance alongside several dozen other jurisdictions.
The automatic exchange of information applies to financial accounts held by individuals or entities with a tax residence in countries that have activated these agreements, commonly referred to as “Reportable Jurisdictions.” The list of Reportable Jurisdictions continues to grow, underscoring Monaco’s commitment to enhancing global tax transparency and compliance.
Benefits
By participating in the automatic exchange of information, Monaco:
- Enhances its reputation as a responsible financial center
- Strengthens its relationships with other jurisdictions
- Supports the fight against tax evasion and corruption
- Contributes to the global effort for greater tax transparency and compliance