Experts from OECD and G20 countries are developing a single truly global model for automatic exchange. A draft detailed model competent authority agreement and related operating documents have already been prepared and were discussed in June by OECD, G20 and other countries. Common guidance will be important to ensure consistency in implementation and interpretation across jurisdictions to avoid creating unnecessary costs and complexity for financial institutions in particular those with operations in more than one country. A model competent authority agreement could be available as early as the second half of 2013 with the detailed guidance following in the first half of 2014. A reporting schema and a first version of the related instructions could also be available in the second half of 2013, to be finalised in the first half of 2014.
The report, a step change in tax transparancy, sets out the key success factors for an effective model for automatic exchange, provides relevant background and outlines four concrete steps needed to put such a model into practice: (i) enacting broad framework legislation to facilitate the expansion of a country's network of partner jurisdictions, (ii) selecting (or where necessary entering into) a legal basis for the exchange of information, (iii) adapting the scope of reporting and due diligence requirements and coordinating guidance, and (iv) developing common or compatible IT standards. The report also provides potential timeframes for each of the action items.