Model 2 Iga Ffi Agreement

It should be noted that the International Capital Market Association has proposed the FATCA language as part of the Global Master Repurchase Agreement, which contains similar compensation. Although this language is not similar in terms of language applicability to Model 2 DieFF intermediaries, it will be primarily relevant to counterparties in Model 2 IGA legal systems. In addition, the Securities Industry and Financial Markets Association has proposed the FATCA language as part of the Master Repurchase Agreement, which takes a similar approach, and similar compensation applies to transactions governed by the International Swap and Derivatives Association (ISDA) 2002, for which counterparties have either entered into the ISDA FATCA protocol or added the FATCA language of the ISDA standard to the corresponding schedule. This issue has not yet been addressed in the current standard market approach to FATCA`s treatment of FATCA under the Global Master Securities Lending Agreement. Market participants should consider whether a similar approach is appropriate in other contexts, taking into account that differences in the distribution of withholding risks and payment mechanics may require a different approach. In accordance with the Taiwan Relations Act, the parties to the agreement are the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States. For more information on model IGAs, autographed IGAs and IGA negotiating contact information, visit the Ministry of Finance`s FATCA IGA Resource Center. Craig Cohen is a senior counsel and John Hibbard is a partner at Allen -Overy LLP. In this article, the authors discuss the fatca withholding rules that apply to financial institutions in the intergovernmental legal orders of Model 2. The Loan Market Association (LMA) has proposed a language that explicitly addresses the residual obligations of Model 2 FFI intermediaries in the context of lending. Under the LMA approach, a lender that does not provide accurate FATCA information to a Model 2 FFI intermediary (usually a facility agent) is required to compensate the Model 2 FFI product intermediary for any liability arising from this failure, including all penalties resulting from the failure of the Model 2 FFI, to honour the remaining obligations.

Otherwise, while a Model 2 FFI intermediary may be able to recover the cost of a sanction under the general AML compensation rules, the costs are allocated by this approach to the specific lender responsible for the omission of the withholding representative, and not to all lenders (including those who have fulfilled their FATCA obligations).