USA Patriot
Act Certification

USA Patriot Act Certification

Vall Banc issues the requisite certification for foreign entities that have a correspondent relationship with US financial institutions, in compliance with the Patriot Act (USA Patriot Act) and with the final standards issued by the U.S. Treasury. (see the document)

 

FATCA

FATCA is the acronym for Foreign Account Tax Compliance Act, a law passed by the U.S.A. tax authority (Internal Revenue Service, IRS) and the U.S. Department of the Treasury, on 18 March 2010, in order to promote fiscal transparency and to strengthen compliance with tax obligations of U.S.A. citizens or residents.

 

FATCA obliges foreign financial entities (hereinafter, FFI, or Foreign Financial Institutions) to comply with specific identification requirements and to report U.S. customers.

 

If a FFI does not cooperate, this latter (and its customers) will be subject to a punitive withholding of 30% on the income resulting from U.S.A. assets.

 

In this regard, FATCA requires financial institutions all around the world to identify those customers whose nationality or fiscal residency is the United States and who have -among other things- financial accounts abroad, which will have to be reported to the U.S. tax authority, on a yearly basis.

 

All Andorran bank entities are financial institutions and are, therefore, bound by this regulation.

 

In general terms, FATCA demands that all Andorran bank entities comply with the following obligations:

 

  1. Register on the IRS web portal set up for this purpose.
  2. Identify the customers (new and pre-existing ones) that are U.S. citizens or U.S. residents and classify natural and also legal persons according to FATCA’s criteria.
  3. Report on a yearly basis to the IRS information on accounts which involve: a) U.S. individuals, b) customers that do not provide the information needed for FATCA identification and c) customers subject to a withholding.
  4. Withholding: The entity must implement mechanisms to correctly conduct the withholdings of customers who are subject to it, due to their FATCA classification, when receiving specific payments originated in the U.S.A.
  5. Alternatively, the entity can transfer the information to the previous intermediary so that the latter can make the required withholding.
  6. Ensure compliance: Implement mechanisms to ensure the correct compliance with all FATCA requirements in relation to the IRS, in accordance with the FFI Agreement, through the certifications issued by the IRS.

 

Grup Vall Banc’s entities undertake to cooperate in compliance with the FATCA regulation and have been registered as financial entities participating in FATCA at the IRS, a federal agency of the U.S. Government, in charge of tax collection and tax law compliance.