Financial Crime World

Greenland and US Agree on FATCA Information Exchange

Promoting Transparency in International Financial Transactions

In a move aimed at enhancing transparency in international financial transactions, Greenland and the United States have agreed to exchange information related to financial accounts held by U.S. taxpayers or foreign entities doing business in the United States.

Key Provisions of the Agreement

  • Greenland will obtain and exchange information with the US regarding financial accounts maintained by Greenlandic financial institutions as of June 30, 2014, and subsequent years.
    • The exchanged information includes details such as:
      • Account holders’ names
      • Addresses
      • Tax identification numbers
      • Account balances

Exceptions to Information Exchange Requirements

  • In cases where a U.S. taxpayer’s identity is not known by the Greenlandic financial institution, the institution may provide alternative identifying information, such as:
    • Date of birth

Procedures for Automatic Exchange of Information

  • The Competent Authorities of Greenland and the US will establish an agreement or arrangement to implement these procedures.
  • This will include rules and procedures necessary to ensure compliance with the agreement.

Confidentiality and Protections

  • The exchanged information will be subject to confidentiality and other protections provided under Article 9 of the agreement, including limitations on the use of the information exchanged.

Special Treatment for Greenlandic Retirement Plans

  • The agreement provides for special treatment of Greenlandic retirement plans, which will be deemed-compliant foreign financial institutions (FFIs) or exempt beneficial owners for purposes of US tax laws.
    • This means that such plans will not be subject to withholding taxes under section 1471 of the U.S. Internal Revenue Code.

Impact and Expectations

  • The agreement is expected to enhance transparency and cooperation between Greenland and the US in the area of international taxation, while also promoting compliance with FATCA requirements.
  • This move demonstrates a commitment to promoting transparency and reducing tax evasion and avoidance in international financial transactions.