Financial Services Ireland


FATCA/CRS Breakfast Seminar

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On 2 December 2016, Amanda Murphy hosted a FATCA/CRS Breakfast Seminar including a breakout session on the US Qualified Intermediary / Qualified Derivatives Dealer and Section 871(m).

A broad range of interesting and insightful topics were covered with guest speaker Lyndsay Smyth, Assistant Principal in the International Division of the Revenue Commissioners, during a Fireside Chat.  The majority of the discussion was in relation to FATCA and CRS due diligence requirements including recent developments with the IRS and reporting readiness for CRS. Also discussed were the updates taking effect for the June 2017 filings, termination of the sponsored and sponsoring entity approach for FATCA and what to expect in terms of Revenue’s approach to FATCA and CRS examinations of Financial Institutions. Other important AEOI related developments were also covered such as domestic reporting, country by country reporting, changes to the voluntary disclosure program and the proposed changes to the 4th AML directive in relation to the exchange of beneficial ownership information.

After Lyndsay took questions from the floor and the Fireside Chat was closed, a breakout session took place on the US Qualified Intermediary and Qualified Derivatives Dealer regime developments and the new US Section 871(m) regulation.

Please click here to view the slides that were discussed during the latter portion of the event.  True to IRS form, an update on 871(m) was released following our discussion which has changed some of the elements of 871(m) implementation.

During the breakout session, information regarding the treatment of ETFs under Section 871(m) was requested – we wanted to provide confirmation that an ETF itself would be treated as the underlying security in a derivative transaction which references it.  Therefore, whether the ETF is US or non-US would determine whether the transaction is potentially in scope of section 871(m).  As you know, in order to be in scope of section 871(m), the underlying security must be US.  Thus, a derivative product referencing a non-US ETF would not be in scope regardless of what that ETF is tracking.

If you would like to engage with EY to assist you with any of the topics covered in the Seminar or have any feedback on the Seminar please don’t hesitate to get in touch with either Amanda Murphy or your usual EY contact.