DATE: April 1, 2014 NO. 24/2014
Registration of Licensed Non-bank Financial Institutions in Compliance with FATCA
ST. GEORGE’S, GRENADA, Tuesday April 1, 2014: The Member Governments of the Eastern Caribbean Currency Union (ECCU) have commenced discussions with the United States of America (US) towards executing an Inter-Governmental Agreement (IGA) for the implementation of the provisions of the US Foreign Account Tax Compliance Act (FATCA).
On 18 March 2010, the US Government enacted FATCA to combat tax evasion by specified US persons holding investments in accounts outside of the United States, specifically as it relates to US-sourced income (see Annex). FATCA requires Foreign Financial Institutions (FFIs) to report to the US Internal Revenue Service (IRS), information on assets of US$50,000 or more held by US taxpayers, or by foreign entities in which US taxpayers hold substantial ownership interest. Failure of an FFI to submit information could result in a 30.0 per cent withholding tax levied on withholdable payments  and may result in the potential loss of correspondent banking relationships.
The ECCU Member Governments have decided to pursue IGA Model 1. This model requires financial institutions to submit customer information to the Inland Revenue Department of the Government of Grenada for onward submission to the IRS. Member Governments have also undertaken to pass the “Foreign Account Tax Compliance (United States) Implementation and Enforcement Bill, 2014”, to provide for the legal submission of customer information for the purposes of FATCA.
In the circumstances all non-bank financial institutions, including off-shore banks, are required to register on the IRS Portal prior to the 25 April 2014 deadline. Timely registration by the deadline would avoid the imposition of the 30.0 per cent withholding tax, the penalty for non-compliance under REG-121647-10 of the “Regulations Relating to Information Reporting by Foreign Financial Institutions and Withholding on Certain Payments to Foreign Financial Institutions and Other Foreign Entities” issued by the IRS. Withholding commences on 1 July 2014.
Institutions are required to visit http://www.irs.gov/Businesses/Corporations/FATCA-Registration where information pertinent to the registration process can be found. It is important that the “IGA Country” option is selected when performing the registration exercise.
 Substantial ownership interest generally means ownership of 10.0 per cent of the company stock.
 A withholdable payment is defined in section to mean: (i) any payment of interest, dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, and other fixed or determinable annual or periodical gains, profits, and income (FDAP income), if such payment is from sources within the United States; and (ii) any gross proceeds from the sale or other disposition of any property of a type which can produce interest or dividends from sources within the United States.
386 TRAINING IN CONFLICT RESOLUTION FOR INLAND REVENUE AND CUSTOMS AND EXCISE DIVISIONS HAILED A SUCCESS
339 GRENADA TO DRAFT A COUNTRY PROGRAMME TO ACCESS CLIMATE FINANCE UNDER THE GREEN CLIMATE FUND (GCF)
315 INCREASED INVESTOR CONFIDENCE IN GRENADA LEADS TO OVER-SUBSCRIPTION OF EC.56 MILLION IN TREASURY BILLS
214 VALIDATION WORKSHOP: DIAGNOSTIC ASSESSMENT OF THE CONSUMER PROTECTION LANDSCAPE IN THE OECS REGION
204 NEW CUSTOMS OFFICERS RECEIVE TRAINING IN MONITORING AND CONTROL OF TRADE IN OZONE DEPLETING SUBSTANCES (ODS)
200 GRENADA TO BENEFIT FROM REGIONAL DEMONSTRATION PROJECT FOR THE REFRIGERATION AND AIR-CONDITIONING SECTOR
197 OECS COUNTRY MISSION TO UNDERTAKE DIAGNOSTIC ASSESSMENT ON CONSUMER AFFAIRS LANDSCAPES IN MEMBER STATES
196 ENERGY DIAGNOSIS AND POLICY EVALUATION WORKSHOP AS GRENADA MOVES FORWARD IN DEVELOPING NATIONAL ENERGY PLANNING GUIDELINES
84 Government to meet with Public Sector Unions to discuss new protocol for Statutory Bodies and State Owned Enterprises
58 November 3, 2014 - DISCUSSION OF DRAFT SCOCIAL COMPACT ON GBN TELEVISION – TUESDAY NOVEMBER 4TH, 2014
54 September 25, 2014 - LOCAL TEAM MEETING HELD FOLLOWING THE UN CONFERENCE IN SMALL ISLAND DEVELOPING STATES (SIDS), SAMOA SEPTEMBER 1-4, 2014
53 September 25, 2014 - LOCAL TEAM MEETING HELD FOLLOWING THE UN CONFERENCE ON SMALL ISLAND DEVELOPING STATES (SIDS), SAMOA SEPTEMBER 1-4, 2014
50 September 18, 2014 - THE NOU TO RECOGNISE INTERNATIONAL DAY 2015 BUDGET PREPARATION MOVING INTO HIGH GEAR
48 September 12, 2014 - THE NOU TO RECOGNISE INTERNATIONAL DAY FOR THE PRESERVATION OF THE OZONE LAYER
47 September 12, 2014 - THE NOU TO RECOGNISE INTERNATIONAL DAY FOR THE PRESERVATION OF THE OZONE LAYER
37 June 30, 2014 - JUNIOR OFFICERS OF CUSTOMS AND EXCISE DIVISION PARTICIPATE IN BASIC TRAINING COURSE
36 June 30, 2014 - JUNIOR OFFICERS OF CUSTOMS AND EXCISE DIVISION PARTICIPATE IN BASIC TRAINING COURSE
24 April 24, 2014 - NOU AND GRENCASE COLLABORATES TO PROVIDE TRAINING IN REFRIGERATION AND AIR-CONDITIONING FUNDAMENTALS
21 April 1, 2014 - GOVERNMENT AND PUBLIC SECTOR UNIONS COMMENCE TALKS ON MEMORANDUM OF UNDERSTANDING FOR HOME-GROWN PROGRAMME OF FISCAL ADJUSTMENT AND REFORMS
20 April 1, 2014 - REGISTRATION OF LICENSED NON-BANK FINANCIAL INSTITUTIONS IN COMPLIANCE WITH FATCA
19 March 27, 2014 - GOVERNMENT AND DIGICEL SIGN AGREEMENT FOR INSTALLATION OF ELECTRONIC TRACKING SYSTEM DEVICES IN ALL GOVERNMENT VEHICLES
15 March 6, 2014 - GRENADA TO HOST ENERGY FOR SUSTAINABLE DEVELOPMENT (ESD) PROJECT INCEPTION MEETING
11 February 26, 2014 - 3RD INSTALLMENT OF RETROACTIVE PAYMENTS TO PUBLIC OFFICERS AND TEACHERS DEFERRED
10 February 25, 2014 - GRENADA CUSTOMS AND EXCISE DIVISION ANNUAL AWARD AND RECOGNITION CEREMONY, 2014
8 February 12, 2014 - COMMITTEE OF SOCIAL PARTNERS MOVING STEADFASTLY TOWARDS THE FINALISATION OF A SOCIAL COMPACT