Investment Funds Update: Common Reporting Standard Effective 1 January 2016
Recent developments with regard to CRS (the OECD’s “Common Reporting Standard”) mean that
Irish funds need to take steps now to update their application forms and subscription documents. As
referred to in Matheson’s November Investment Funds Newsletter, the Irish Finance Bill 2015 contains
further provisions putting in place the necessary legislative framework for the implementation in
Ireland of the CRS, building on measures introduced in the Finance Act 2014. The implementation of
the CRS in Ireland will require Irish investment funds to amend their application forms in order to
obtain certain additional information from investors.
The CRS, which will apply in Ireland from 1 January 2016, is a new global standard on the automatic
exchange of information which is designed to combat tax evasion. More than 90 countries have now
indicated that they will implement CRS reporting in their jurisdiction. It will oblige financial institutions
and investment entities (including investment funds) to report certain information in relation to non-
resident investors to the local tax authorities. This information will then be passed on by the local tax
authorities to the tax authorities of the investors’ country of residence (assuming such countries are
also participating in the CRS scheme). Irish regulations enacting the CRS regime will be implemented
before year end.
As part of the CRS scheme, investors will need to provide additional information to investment funds,
on subscribing for units or shares in the fund. Investment funds will have an obligation to identify and
confirm the tax residence status of all new and existing investors in a reporting Irish fund. The
requirements under the CRS supplement the current obligations to identify and confirm the status of
investors from a US tax perspective under the US Foreign Account Tax Compliance Act (“FATCA”).
The Irish funds industry representative body, Irish Funds, has now published appropriate self-
certification forms incorporating the requirements under both FATCA and CRS for both individuals and
entities. The Irish tax authorities and the Irish Data Protection Commissioner have also provided
guidance on additional details which should be included in fund application forms and subscription
documents.
The Irish tax authorities have advised industry that, in respect of new investors, self-certifications must
be obtained and validated at account opening stage or within 90 days of opening the account at the
latest. In relation to accounts opened prior to 1 January 2016, it is expected that the Irish
implementation regulations will specify the deadline by which the necessary due diligence must be
undertaken.
Consequently, Irish funds must update their application forms and / or subscription documents before
1 January 2016 to reflect the CRS. It is also recommended to update fund prospectuses in due
course to reflect these new CRS issues. We are happy to work with clients to assist with the review
and update of their application forms to meet the CRS requirements.
Please get in touch with your usual Asset Management and Investment Funds or Tax contact or any of
the contacts listed in this publication should you require further information in relation to the
implementation of the CRS.
_________________________________________________________________________________
Full details of the Asset Management and Investment Funds Group, together with further updates,
articles and briefing notes written by members of the Asset Management and Investment Funds team,
can be accessed at www.matheson.com.
The material is provided for general information purposes only and does not purport to cover every
aspect of the themes and subject matter discussed, nor is it intended to provide, and does not
constitute, legal or any other advice on any particular matter. The information in this document is
provided subject to the Legal Terms and Liability Disclaimer contained on the Matheson website.
Copyright © Matheson
Matheson Publication November 2015
2