• Service: Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 1/9/2014

Switzerland - FATCA implications for non-financial groups 

January 9: Although the primary focus of FATCA* is on foreign financial institutions, Swiss non-financial groups and entities also may be subject to FATCA in their role as a U.S. payor / withholding agent or as a foreign payee / recipient of payments subject to FATCA.

*FATCA = Foreign Account Tax Compliance Act (U.S. legislation)

FATCA imposes significant compliance requirements on non-financial groups. Therefore, both Swiss domestic and multinational enterprises need to familiarize themselves with the FATCA requirements to find out whether they could be considered to be a foreign financial institution (FFI) or a non-financial foreign entity (NFFE).

Qualifying as one or the other could affect or determine what steps are to be taken next.

Commodities traders will be particularly affected by FATCA. The reason for this is that under FATCA, the term “financial assets” can include commodities. Thus, any foreign investment entity trading in commodities (e.g., oil and gas) whether settled physically or in cash, would need to register as an FFI because this commodity trading could qualify as trading in “financial assets.”

Read a January 2014 blog posting prepared by the KPMG member firm in Switzerland: FATCA – Implications for Non-Financial Groups?

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