Tsai Hong-tu of Taiwan’s Cathay Financial Holdings has brought up the issue of FATCA in the APEC (Asia-Pacific Economic Cooperation) Business Advisory Council, and suggested the establishment of a working group to formulate a response to the issue. It’s rather ambiguous exactly what Tsai’s goal is for his proposed multilateral FATCA discussions, but at least it’s more encouraging than the craven surrender by Taiwan’s Bankers Association.
Possibly of interest to the Canadians in the audience: ABAC is not just an Asia-focused organisation — its membership list includes representatives from a number of countries on the
western eastern side of the Pacific Rim, including Chile, Mexico, Peru. and Canada (as well as the U.S. itself). And even though it ABAC is not a finance-specific organisation either, two out of Canada’s three representatives to ABAC are in the finance industry:
- Mrs. Isabelle Courville, President of Hydro-Québec Distribution
- Mr. V. Paul Lee, Managing Partner of VanEdge Capital Partners Ltd.
- Mr. Philip Leong, Vice President & Director, Chairman’s Council, RBC Dominion Securities
Maybe this will be a roadblock, or at minimum a speedbump, in the way of the U.S’ “divide-and-conquer” FATCA strategy. I translated a radio report about Tsai’s proposal after the jump.
|Taiwan’s ABAC representative hopes to establish working group on U.S. FATCA law
|Source: Radio Taiwan International
|Time: 28 August 2012, 18:03
|Copywriting & editing: Chen Lin Hsing-hong
|美國通過「外國帳戶稅收遵從法」(Foreign Account Tax Compliance Act，簡稱FATCA)，要包括台灣在內的全球金融機構向美國國稅局通報海外美國人的金融資料。代表台灣出席APEC企業諮詢委員會(ABAC)代表團團長、國泰金控董事長蔡宏圖今天(28日)表示，將在大會上建議組成特別小組因應。
|With the U.S.’ passage of the Foreign Account Tax Compliance act (FATCA), global financial institutions, including those in Taiwan, are required to report financial information of Americans abroad to the U.S.’ Internal Revenue Service. Tsai Hong-tu, the head of Taiwan’s delegation to the APEC Business Advisory Council (ABAC) and Cathay Financial Holdings’ chairman of the board, today (28 August) stated that he will suggest the establishment of a dedicated working group to deal with the issue at the general meeting.
|The U.S.’ 2010 Foreign Account Tax Compliance Act, known for short as FATCA, requires global financial institutions in every location to supply account balances and income details relating to persons obliged to pay tax who have U.S. citizenship. Financial institutions which do not sign an agreement will face a 30% punitive withholding tax on their future U.S. income. The law is set to come into effect in 2017.
|Tsai Hong-tu, the head of Taiwan’s delegation to the APEC Business Advisory Council (ABAC) and Cathay Financial Holdings’ Chairman of the Board, today (28 August) at a press conference before the event, stated that the U.S.’ move touched on commercial confidentiality and customer privacy, involving a wide range of complex issues. Because of this, the Taiwan delegation recommends that ABAC organise a special working group in response. Tsai stated, “Member countries including ourselves, as well as others such as Thailand and Malaysia, with regards to the facilitation of this topic [are concerned] whether or not it will be affected or restricted by economic and legal limitations and so cannot be worked out. Everyone places great emphasis on this issue, and so we are suggesting the establishment of a working group to discuss the topic.”
|Aside from the U.S.’ FATCA becoming one of the main issue at ABAC this year, ABAC’s theme this year is “from vision to reality”, which in the face of global economic turmoil due to Euro debt and the like, urges APEC economies to carry out trade liberalisation and maintain economic growth, while at the same time take steps to avoid a financial crisis and the outbreak of protectionism.
It’s interesting that Tsai brings up Thailand — one would think that Thailand would be paying close attention to FATCA, given that their current king Bhumibol Adulyadej was born in Cambridge, Massachusetts, but judging from a Google search no one in Thailand is even thinking of it.