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ARTICLE · 11 MARCH 2014

Canada’s FATCA Legislation Jeopardizes IGA

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On February 5, 2014 Canada and the U.S. executed a model 1 intergovernmental agreement ("IGA"), which relieved Canadian financial institutions from many of the onerous obligations under FATCA.

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Kim Moody
Kim Moody
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On February 5, 2014 Canada and the U.S. executed a model 1 intergovernmental agreement ("IGA"), which relieved Canadian financial institutions from many of the onerous obligations under FATCA. On the same day, the Canadian Department of Finance issued draft legislation required under Canadian law to implement the IGA and requested comments on the draft legislation before March 10, 2014.

As we addressed in our report to the Department of Finance ( click here), our primary concern with the draft legislation is that it eviscerates the definition of "Financial Institution" contained in: a) the IGA; b) Treasury Regulations; c) intergovernmental agreements executed by other jurisdictions; and d) guidance notes issued by the U.K., and Ireland.

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