Small or Limited Scope Financial Institutions that Qualify as Deemed-Compliant Financial Institutions.
The following Financial Institutions are treated as Non-Reporting Curaçao Financial Institutions and as deemed-compliant FFIs for purposes of section 1471 of the U.S. Internal Revenue Code:
- A)Financial Institutions with a Local Client Base. Any Financial Institution that meets all of the following requirements:
- 1.The Financial Institution must be licensed and regulated under the laws of Curaçao;
- 2.The Financial Institution must have no fixed place of business outside Curaçao. For this purpose, a fixed place of business does not include a location that is not advertised to the public and from which the Financial Institution performs solely administrative support functions;
- 3.The Financial Institution must not solicit account holders outside Curaçao. For this purpose, a Financial Institution shall not be considered to have solicited account holders outside of Curaçao merely because the Financial Institution (a) operates a website, provided that the website does not specifically indicate that the Financial Institution provides Financial Accounts or services to non-residents, and does not otherwise target or solicit U.S. customers or Account Holders; or (b) advertises in print media or on a radio or television station that is distributed or aired primarily within Curaçao but is also incidentally distributed or aired in other countries, provided that the advertisement does not specifically indicate that the Financial Institution provides Financial Accounts or services to nonresidents, and does not otherwise target or solicit U.S. customers or Account Holders;
- 4.The Financial Institution must be required under the tax laws of Curaçao to identify resident Account Holders for purposes of either information reporting or withholding of tax with respect to Financial Accounts held by residents or for purposes of satisfying Curaçao’s AML due diligence requirements;
- 5.At least 98 percent of the Financial Accounts by value maintained by the Financial Institution must be held by residents (including residents that are entities) of Curaçao;
- 6.Beginning on July 1, 2014, the Financial Institution must have policies and procedures, consistent with those set forth in Annex I, to prevent the Financial Institution from providing a Financial Account to any Nonparticipating Financial Institution and to monitor whether the Financial Institution opens or maintains a Financial Account for any Specified U.S. Person who is not a resident of Curaçao (including a U.S. Person that was a resident of Curaçao when the account was opened but subsequently ceases to be a resident of Curaçao) or any Passive NFFE with Controlling Persons who are U.S. citizens or residents who are not residents of Curaçao;
- 7.Such policies and procedures must provide that if any Financial Account held by a Specified U.S. Person who is not a resident of Curaçao or by a Passive NFFE with Controlling Persons who are U.S. residents or U.S. citizens who are not residents of Curaçao is identified, the Financial Institution must report such Financial Account as would be required if the Financial Institution were a Reporting Curaçao Financial Institution (including by following the applicable registration requirements on the IRS FATCA registration website) or close such Financial Account;
- 8.With respect to a Preexisting Account held by an individual who is not a resident of Curaçao or by an Entity, the Financial Institution must review those Preexisting Accounts in accordance with the procedures set forth in Annex I applicable to Preexisting Accounts to identify any U.S. Reportable Account or Financial Account held by a Nonparticipating Financial Institution, and must report such Financial Account as would be required if the Financial Institution were a Reporting Curaçao Financial Institution (including by following the applicable registration requirements on the IRS FATCA registration website) or close such Financial Account;
- 9.Each Related Entity of the Financial Institution must be established in Curaçao and, with the exception of any Related Entity that is a retirement fund described in paragraphs A through C of section I of this Annex II, meet the requirements set forth in this paragraph A; and
- 10.The Financial Institution must not have policies or practices that discriminate against opening or maintaining Financial Accounts for individuals who are Specified U.S. Persons and residents of Curaçao.
- B)Local Bank. A Financial Institution satisfying the following requirements:
- 1.The Financial Institution operates solely as (and is licensed and regulated under the laws of Curaçao as) (a) a bank or (b) a credit union or similar cooperative credit organization that is operated without profit;
- 2.The Financial Institution’s business consists primarily of receiving deposits from and making loans to, with respect to a bank, unrelated retail customers and, with respect to a credit union or similar cooperative credit organization, members, provided that no member has a greater than five percent interest in such credit union or cooperative credit organization;
- 3.The Financial Institution satisfies the requirements set forth in subparagraphs A(2) and A(3) of this section, provided that, in addition to the limitations on the website described in subparagraph A(3) of this section, the website does not permit the opening of a Financial Account;
- 4.The Financial Institution does not have more than $175 million in assets on its balance sheet, and the Financial Institution and any Related Entities, taken together, do not have more than $500 million in total assets on their consolidated or combined balance sheets; and
- 5.Any Related Entity must be established in Curaçao, and any Related Entity that is a Financial Institution, with the exception of any Related Entity that is a retirement fund described in paragraphs A through C of section II of this Annex II or a Financial Institution with only low-value accounts described in paragraph C of this section, must satisfy the requirements set forth in this paragraph B.
- C)Financial Institution with Only Low-Value Accounts. A Curaçao Financial Institution satisfying the following requirements:
- 1.The Financial Institution is not an Investment Entity;
- 2.No Financial Account maintained by the Financial Institution or any Related Entity has a balance or value in excess of $50,000, applying the rules set forth in Annex I for account aggregation and currency translation; and
- 3.The Financial Institution does not have more than $50 million in assets on its balance sheet, and the Financial Institution and any Related Entities, taken together, do not have more than $50 million in total assets on their consolidated or combined balance sheets.
- D)Qualified Credit Card Issuer. A Curaçao Financial Institution satisfying the following requirements:
- 1.The Financial Institution is a Financial Institution solely because it is an issuer of credit cards that accepts deposits only when a customer makes a payment in excess of a balance due with respect to the card and the overpayment is not immediately returned to the customer; and
- 2.Beginning on or before July 1, 2014, the Financial Institution implements policies and procedures to either prevent a customer deposit in excess of $50,000, or to ensure that any customer deposit in excess of $50,000, in each case applying the rules set forth in Annex I for account aggregation and currency translation, is refunded to the customer within 60 days. For this purpose, a customer deposit does not refer to credit balances to the extent of disputed charges but does include credit balances resulting from merchandise returns.
