VI Special Rules and Definitions.

The following additional rules and definitions apply in implementing the due diligence procedures described above:

• A.. A Reporting Netherlands Financial Institution may not rely on a self-certification or documentary evidence if the Reporting Netherlands Financial Institution knows or has reason to know that the self-certification or documentary evidence is incorrect or unreliable.
• B.. The following definitions apply for purposes of this Annex I.
• 1.. “AML/KYC Procedures” means the customer due diligence procedures of a Reporting Netherlands Financial Institution pursuant to the anti-money laundering or similar requirements of the Netherlands to which such Reporting Netherlands Financial Institution is subject.
• 2.. An “NFFE” means any Non-U.S. Entity that is not an FFI as defined in relevant U.S. Treasury Regulations or is an Entity described in subparagraph B(4)(j) of this section, and also includes any Non-U.S. Entity that is resident in the Netherlands or established in another Partner Jurisdiction and that is not a Financial Institution.
• 3.. A “Passive NFFE” means any NFFE that is not (i) an Active NFFE, or (ii) a withholding foreign partnership or withholding foreign trust pursuant to relevant U.S. Treasury Regulations.
• 4.. An “Active NFFE” means any NFFE that meets any of the following criteria:
• a)Less than 50 percent of the NFFE’s gross income for the preceding calendar year or other appropriate reporting period is passive income and less than 50 percent of the assets held by the NFFE during the preceding calendar year or other appropriate reporting period are assets that produce or are held for the production of passive income;
• b)The stock of the NFFE is regularly traded on an established securities market or the NFFE is a Related Entity of an Entity the stock of which is regularly traded on an established securities market;
• c)The NFFE is organized in a U.S. Territory and all of the owners of the payee are bona fide residents of that U.S. Territory;
• d)The NFFE is a government (other than the U.S. government), a political subdivision of such government (which, for the avoidance of doubt, includes a state, province, county, or municipality), or a public body performing a function of such government or a political subdivision thereof, a government of a U.S. Territory, an international organization, a non-U.S. central bank of issue, or an Entity wholly owned by one or more of the foregoing;
• e)Substantially all of the activities of the NFFE consist of holding (in whole or in part) the outstanding stock of, or providing financing and services to, one or more subsidiaries that engage in trades or businesses other than the business of a Financial Institution, except that an entity shall not qualify for a NFFE status if the entity functions (or holds itself out) as an investment fund, such as a private equity fund, venture capital fund, leveraged buyout fund, or any investment vehicle whose purpose is to acquire or fund companies and then hold interests in those companies as capital assets for investment purposes;
• f)The NFFE is not yet operating a business and has no prior operating history, but is investing capital into assets with the intent to operate a business other than that of a Financial Institution, provided that the NFFE shall not qualify for this exception after the date that is 24 months after the date of the initial organization of the NFFE;
• g)The NFFE was not a Financial Institution in the past five years, and is in the process of liquidating its assets or is reorganizing with the intent to continue or recommence operations in a business other than that of a Financial Institution;
• h)The NFFE primarily engages in financing and hedging transactions with, or for, Related Entities that are not Financial Institutions, and does not provide financing or hedging services to any Entity that is not a Related Entity, provided that the group of any such Related Entities is primarily engaged in a business other than that of a Financial Institution;
• i)The NFFE is an “excepted NFFE” as described in relevant U.S. Treasury Regulations; or
• j)The NFFE meets all of the following requirements:
• (i)It is established and operated in its jurisdiction of residence exclusively for religious, charitable, scientific, artistic, cultural, athletic, or educational purposes; or it is established and operated in its jurisdiction of residence and it is a professional organization, business league, chamber of commerce, labor organization, agricultural or horticultural organization, civic league or an organization operated exclusively for the promotion of social welfare;
• (ii)It is exempt from income tax in its jurisdiction of residence;
• (iii)It has no shareholders or members who have a proprietary or beneficial interest in its income or assets;
• (iv)The applicable laws of the NFFE’s jurisdiction of residence or the NFFE’s formation documents do not permit any income or assets of the NFFE to be distributed to, or applied for the benefit of, a private person or non-charitable Entity other than pursuant to the conduct of the NFFE’s charitable activities, or as payment of reasonable compensation for services rendered, or as payment representing the fair market value of property which the NFFE has purchased; and
• (v)The applicable laws of the NFFE’s jurisdiction of residence or the NFFE’s formation documents require that, upon the NFFE’s liquidation or dissolution, all of its assets be distributed to a governmental entity or other non-profit organization, or escheat to the government of the NFFE’s jurisdiction of residence or any political subdivision thereof.
• 5.. A “Preexisting Account” means a Financial Account maintained by a Reporting Financial Institution as of June 30, 2014.
• C..
• 1.. For purposes of determining the aggregate balance or value of Financial Accounts held by an individual, a Reporting Netherlands Financial Institution is required to aggregate all Financial Accounts maintained by the Reporting Netherlands Financial Institution, or by a Related Entity, but only to the extent that the Reporting Netherlands Financial Institution’s computerized systems link the Financial Accounts by reference to a data element such as client number or taxpayer identification number, and allow account balances or values to be aggregated. Each holder of a jointly held Financial Account shall be attributed the entire balance or value of the jointly held Financial Account for purposes of applying the aggregation requirements described in this paragraph 1.
• 2.. For purposes of determining the aggregate balance or value of Financial Accounts held by an Entity, a Reporting Netherlands Financial Institution is required to take into account all Financial Accounts that are maintained by the Reporting Netherlands Financial Institution, or by a Related Entity, but only to the extent that the Reporting Netherlands Financial Institution’s computerized systems link the Financial Accounts by reference to a data element such as client number or taxpayer identification number, and allow account balances or values to be aggregated.
• 3.. For purposes of determining the aggregate balance or value of Financial Accounts held by a person to determine whether a Financial Account is a High Value Account, a Reporting Netherlands Financial Institution is also required, in the case of any Financial Accounts that a relationship manager knows, or has reason to know, are directly or indirectly owned, controlled, or established (other than in a fiduciary capacity) by the same person, to aggregate all such accounts.
• 4.. For purposes of determining the balance or value of Financial Accounts denominated in a currency other than the U.S. dollar, a Reporting Netherlands Financial Institution must convert the U.S. dollar threshold amounts described in this Annex I into such currency using a published spot rate determined as of the last day of the calendar year preceding the year in which the Reporting Netherlands Financial Institution is determining the balance or value.
• D.. For purposes of this Annex I, acceptable documentary evidence includes any of the following:
• 1.A certificate of residence issued by an authorized government body (for example, a government or agency thereof, or a municipality) of the jurisdiction in which the payee claims to be a resident.
• 2.With respect to an individual, any valid identification issued by an authorized government body (for example, a government or agency thereof, or a municipality), that includes the individual’s name and is typically used for identification purposes.
• 3.With respect to an Entity, any official documentation issued by an authorized government body (for example, a government or agency thereof, or a municipality) that includes the name of the Entity and either the address of its principal office in the jurisdiction (or U.S. Territory) in which it claims to be a resident or the jurisdiction (or U.S. Territory) in which the Entity was incorporated or organized.
• 4.With respect to a Financial Account maintained in a jurisdiction with anti-money laundering rules that have been approved by the IRS in connection with a QI agreement (as described in relevant U.S. Treasury Regulations), any of the documents, other than a Form W-8 or W-9, referenced in the jurisdiction’s attachment to the QI agreement for identifying individuals or Entities.
• 5.Any financial statement, third-party credit report, bankruptcy filing, or U.S. Securities and Exchange Commission report.
• E.. A Reporting Netherlands Financial Institution may presume that an individual beneficiary (other than the owner) of a Cash Value Insurance Contract receiving a death benefit is not a Specified U.S. Person and may treat such Financial Account as a non-U.S. Reportable Account unless the Reporting Netherlands Financial Institution has actual knowledge, or reason to know, that the beneficiary is a Specified U.S. Person. A Reporting Netherlands Financial Institution has reason to know that a beneficiary of a Cash Value Insurance Contract is a Specified U.S. Person if the information collected by the Reporting Netherlands Financial Institution and associated with the beneficiary contains U.S. indicia as described in subparagraph (B)(1) of section II of this Annex I. If a Reporting Netherlands Financial Institution has actual knowledge, or reason to know, that the beneficiary is a Specified U.S. Person, the Reporting Netherlands Financial Institution must follow the procedures in subparagraph B(3) of section II of this Annex I.
• F.. Regardless of whether an election is made under paragraph C of section I of this Annex I, the Netherlands may permit Reporting Netherlands Financial Institutions to rely on due diligence procedures performed by third parties, to the extent provided in relevant U.S. Treasury Regulations.