Standard Updates to address CRS and new AML definition for Politically Exposed Person
On March 8, CLIEDIS held a webinar with CLHIA representatives to discuss the new Common Reporting Standards (CRS). The CRS is a global model for the automatic exchange of information on financial accounts (such as bank, mutual fund and brokerage accounts, and some annuities and life insurance policies), that is similar to U.S. FATCA.
To support these new requirements, CLIEDIS has added the following to the ACORD Standard:
- Four new requirement codes:
- 1008 FATCA & CRS Declaration of Tax Residency of Individual (CRA Form RC518)
- 1009 FATCA & CRS Declaration of Tax Residency of Entity (CRA Form RC519)
- 1010 CRS Only Declaration of Tax Residency of Individual (CRA Form RC520)
- 1011 CRS Only Declaration of Tax Residency of Entity (CRA Form RC521)
These would be used in the CITS Pending Status for identifying the form(s) to be completed. These codes are in addition to the two FATCA only forms (923 for individual, 924 for entity) in the standard.
It is anticipated that the majority of carriers will opt to use a single set of forms for both FATCA & CRS (1008 & 1009) but it is not required.
- A new element TaxResidentInd
This corresponds with the Government ID where the Government ID is captured (on both Party and GovtIDInfo).
This does not affect any CITS guides right now but may be needed by companies implementing an ACORD 103 New Business message.
Separately, CLIEDIS has addressed the new changes coming from AML in relation to the expanded definition of a politically exposed person (PEP). It will now include not only for a foreign PEP, but also for a domestic PEP, a head of an international organization, a family member of one of those persons or a person who is closely associated with a PEP (PEP Related Person).
We determined that new requirement codes and attachment types are not needed. Instead, we are updating the definition on our existing codes to account for the expanded definition. Affected codes are requirement codes 842 & 843 and attachment types 518 & 519.
FYI for ALL
These changes officially go into effect with the new ACORD standard in July 2017, once the ACORD voting and publication process is complete. The requirement code values can be used now.
In addition, we are scheduling a follow-up webinar May 3rd to review the CLHIA FAQs being published. This will be announced separately once registration is available.
Implementation Services Specialist