Multilateral Competent Authority Agreement

Transparency groups have reacted in different ways, and some criticize the fact that developing countries have not been considered and involved. [23] The collection and provision of information can be so costly and difficult for developing countries that it is not possible to participate in the regime. Instead of offering a period of non-reciprocity during which developing countries could simply obtain financial data, the only mention of non-reciprocal agreements is the reception of tax havens. [23] Since October 2014[update], 51 countries have signed the Competent Multilateral Authority Agreement (MCAA) to automatically exchange information on the basis of Article 6 of the Convention on Mutual Tax Assistance. [6] The new system should automatically and systematically transmit all relevant information. The agreement has been informally referred to as GATCA (the global version of FATCA), but “CRS is not just an extension of FATCA.” [4] Given that more than 100 legal systems have committed to the exchange of information within the IRS, exchanges between legal systems are generally based on the Multilateral Convention on Mutual Tax Assistance (Convention), which involves more than 100 jurisdictions, and the IRS Convention on Multilateral Competent Authority (CRS MCAA), which is based on Article 6. Legal systems can be based on a bilateral agreement, such as a double taxation agreement or an agreement on the exchange of tax information. In addition, some IRS exchanges will be organised on the basis of the relevant EU directive, agreements between the EU and third countries and bilateral agreements such as the agreements between the UK and the CDOT. This means that each jurisdiction can negotiate and define its own accounts to declare in its agreement.

[Citation required] The CRS MCAA provides details of the information that will be exchanged and when. It is a multilateral framework agreement. A specific bilateral relationship under the MCAA CRS only comes into force when the two jurisdictions have implemented the convention, submitted the necessary notifications in accordance with Section 7 and presented themselves to each other. In May 2014, 47 countries tentatively agreed on a “common reporting standard,” officially designated as the standard for the automatic exchange of financial account information: an automatic exchange of information on residents` assets and income in accordance with the standard. [2] Among the 34 OECD countries, Argentina, Brazil, China, Colombia, Costa Rica, India, Indonesia, Latvia, Lithuania, Malaysia, Saudi Arabia, Singapore and South Africa. [2] In August 2020, more than 2,500 bilateral exchange relations were activated for jurisdictions that commit to exchange CBC reports, and the first automatic exchange of CBC reports took place in June 2018.