Comparison of NAFTA, BRIC, EU and Caribbean of the 8 FATCA GIIN Lists (June 2014 -> January 2015)

Comparison of the Current Eight GIIN Lists (June 2014 -> January 2015)

continued from Saturday's post

The June 2, 2014 GIIN list contained 77,353 registrations from 205 countries and jurisdictions.[1]  Of the June registrations, 74 percent were from Model 1 IGAs that had been either signed or recognized as agreed in substance by the IRS.  Approximately 20 percent of these total registrations were from Cayman Islands firms, and 37 percent of the total from the UK and its Crown dependencies and overseas territories.  Cayman Islands remains the FATCA registration leader (see below).

On July 1, 2014 the IRS published the second monthly GIIN list. This list contained only an additional 10,000 registrations, bringing the total to 87,993.[2]  82,994 of this total, approximately 95 percent, were from the 98 countries from by July the IRS recognized IGAs.  Only five percent (4,318) of the registrations derived from the remaining non-IGA countries upon which Chapter 4 withholding went into effect on the day of the list’s publication.

After the first month of FATCA withholding, the August 2014 GIIN list experienced an unexpected decline in registrations, with only 7,246 additional entities bringing the total to 95,239.[3]  Yet, as of this third GIIN list, the IRS recognized 101 IGAs from which 89,718 institutions (94 percent) registered although withholding will not be levied by U.S. withholding agents until January 1, 2015.[4]  Only 4,801 (approximately five percent) registered from the 143 countries and territories without an IGA, leaving multitudes of their FFIs exposed.  September’s GIIN list continued the downward trend in FFI registration and did not reach a 100,000 registration mark (99,861).[5]  Finally, the October 1, 2014 breached 100,000 registrations (104,344), albeit with a continued poor registration response. 

The November 2014 list saw a jump in registration, led by the United Kingdom, achieving a total of 116,104 FFIs and branch registrations.[6]  43 percent of all registered GIIN are from the UK and her Crown Dependencies and Overseas Territories. The December GIIN list released grew by another 6,000 to 122,881, of which only 6,094 were from non-IGA countries.  Such a stunted growth in FFI registration is foreboding of the remaining, significant compliance challenges.  FFI Registration as of Janaury 1, 2015 stands at 147,043.

The IRS stated that “… the full FFI list is expected to be less than 500,000 records”.[7] Based on upon industry discussions and a review of industry literature of financial institution compliance officers, the Big 4, and upon revenue authority estimates, it is reasonable to state that approximately 500,000 entities are impacted by Chapter 4 withholding and need to register for a GIIN.  Literature and the industry actually place the range of impacted entities at a minimum half million to a maximum of one million. 

NAFTA Registrations

The initial June 1 GIIN list contained 2,264 FFIs registered from Canada and Mexico at 418.  By November 1, 2014 NAFTA has barely inched forward.  Canada's November 1 GIIN list included an additional registrations of 143, at least breaching the 3,000 mark (3,043, where it remained as of the December list) but with a sizeable jump to 3,975 for the 2015.  Mexico’s six for additional November registrations left it with only 522 registered institutions, ten more for 532 as of December, and nearly 50 additional to end at 581 for the start of 2015. [8]

 BRIC Registrations

BRIC remains dissappointing.  For the initial June list, Brazil led the BRIC countries with 2,258 FFI registrations, followed by Russia (514), India (246) with China only having 211.  Based upon the most recent data, the BRIC countries have thus far shrugged off FATCA.  

During October, India and China competed for FATCA lethargy with only ten FFIs registering from China moving it from 599 to 609 (658 as of the December list, and now 927 for 2015's initial list), and merely two from India for a total of 393 as of the November 1 GIIN list (401 as of December, 442 for January 2015).  Brazil experienced the largest amount of registrations, jumping approximately 400 to 2,841 (3,179 as of December, 3,594 for 2015), whereas only 40 Russian entities registered (961 in November, 993 as of December, and 1,050 for 2015's start). 

European Financial Centers Registrations

For the first GIIN list, Switzerland had 4,040 registered FFIs, Luxembourg had 3,560, Austria 2,978, Guernsey 2,395, Jersey 1,618, Isle of Man 312, Lichtenstein 239 and Gibraltar only 96.  Gibraltar by November had the most substantial increase to 1,841. Switzerland had increased to 4,698, Luxembourg 7,023, Austria 3,051, Guernsey 3,419, Jersey 4,088 Isle of Man 970, and Lichtenstein 828.

Major OECD Countries Registrations

The major OECD trade partners of the U.S. such as France which entered the June GIIN list with only 2,290 registrations have not yet seen robust FATCA registration compliance relastive to the size of their financial services industry, but in general experienced significant jumps in the last month of the year for GIIN registrants.  France is now at 3,730 after eight months of registration deadlines, Germany went from 2,254 to 3,751, Ireland 1,756 to 3,661, Netherlands 2,053 to 3,103 and Australia 1,864 to 3,067.

Caribbean and Atlantic Financial Centers Registrations

The Cayman Islands remain the global FATCA compliance registration leader with 27,011 FFIs on the GIIN list, almost 7,000 more compliant FFIs than the UK.  The June GIIN list included 1,837 BVI FFI registrations, now at 4,653.  Bahamas has increased from 610 to 882, Bermuda 1,242 to 1,824 and Panama 450 to 773.  

By the way, the 3rd edition of my Lexis Guide to FATCA Compliance will be out soon with substantial more analysis – 1,200 pages over 54 chapters.  Over 50 FATCA compliance experts from tier 1 institutions, former government officials, and professional firms have contributed to create this detailed and robust guide, filled with numerous practical examples and several chapters written specifically for the non-legal, compliance operations officer.  No filler pages of publicly available documents and regurgitated regulations – it’s all beef.  See the Lexis website to order a copy of this 3rd edition.

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[1] For a detailed June analysis, see http://profwilliambyrnes.com/2014/06/25/5-new-igas-with-3-business-days-to-go-until-30-fatca-withholding-on-remaining-167-countries-begins/  (accessed November 9, 2014).

[2] See http://profwilliambyrnes.com/2014/07/01/july-1st-ffi-list-analysis/  (last accessed November 9, 2014).

[3] See http://lawprofessors.typepad.com/intfinlaw/2014/08/august-fatca-giin-list-analysed-by-byrnes-and-perryman.html  (accessed November 9, 2014).

[4] See http://www.treasury.gov/resource-center/tax-policy/treaties/pages/fatca-archive.aspx  (accessed November 9, 2014).

[5] See http://lawprofessors.typepad.com/intfinlaw/2014/09/fatca-ffi-update-and-it-doesnt-look-pretty-september-did-not-break-100000.html  (accessed November 9, 2014).

[6] See http://lawprofessors.typepad.com/intfinlaw/2014/11/novembers-published-fatca-giin-list-analysis.html (accessed November 9, 2014).

[7] IRS FFI List FAQs, FFI List Q7. Available at http://www.irs.gov/Businesses/Corporations/IRS-FFI-List-FAQs (accessed November 9, 2014).

[8] December's GIIN analysis at http://lawprofessors.typepad.com/intfinlaw/2014/12/analysis-of-the-2014-fatca-giin-registration-lists.html (accessed November 9, 2014).