US Revamps Retirement Plans for Armenian Institutions

In a bid to boost financial cooperation, the United States has introduced new regulations governing retirement plans for institutions in Armenia.

Enhanced Cooperation through Regulatory Changes

The changes aim to facilitate the exchange of information between US authorities and Armenian financial institutions, ensuring compliance with international standards. These regulatory updates will simplify the process for Armenian financial institutions to comply with US regulations, reducing the administrative burden on both parties.

Key Provisions

A Republic of Armenia retirement plan includes an entity established or located in Armenia, regulated by the country’s laws, and operated to provide pension or retirement benefits.
The plan must also be compliant with relevant reporting requirements, taxation, and sponsorship regulations.
Non-reporting Republic of Armenia financial institutions are deemed-compliant FFIs (Foreign Financial Institutions) or exempt beneficial owners for purposes of the US Internal Revenue Code.

The agreement includes special rules for related entities and branches that are non-participating financial institutions. These entities will continue to be treated as participating FFIs or deemed-compliant FFIs if they meet certain conditions, including reporting requirements and tax compliance.

Coordination with US Treasury Regulations

The Republic of Armenia is allowed to use definitions from relevant US Treasury regulations in implementing the agreement, provided that such application does not frustrate the purposes of the agreement.

Verification and Enforcement

The US Competent Authority has the power to make inquiries directly to reporting Armenian financial institutions where minor errors may have occurred.
In cases of significant non-compliance, the US authority will notify the Republic of Armenia’s Competent Authority, and if the issue is not resolved within 12 months, the institution will be treated as a non-participating financial institution.

Competent Authority Agreement

The Competent Authorities of the Republic of Armenia and the United States have agreed to enter into an agreement or arrangement to establish procedures for exchanging information and implementing the agreement. These changes aim to enhance cooperation between the two countries in the area of retirement planning, promoting transparency and compliance with international standards.