OECD Unveils New Global Standard on Automatic Exchange of Information

The OECD has unveiled a new single global standard for the automatic exchange of information between tax authorities worldwide in response to a mandate from G20 leaders to reinforce action against tax avoidance and evasion and inject greater trust and fairness into the international tax system.

The new standard, which has been developed by the OECD together with G20 countries, calls on jurisdictions to obtain information from their financial institutions and exchange that information automatically with other jurisdictions on an annual basis.

The standard will be formally presented for the endorsement of G20 finance ministers, by the OECD, during a meeting in Sydney, Australia on 22-23 February.

OECD Secretary-General Angel Gurría said: “This is a real game changer. Globalisation of the world’s financial system has made it increasingly simple for people to make, hold and manage investments outside their country of residence. This new standard on automatic exchange of information will ramp up international tax co-operation, putting governments back on a more even footing as they seek to protect the integrity of their tax systems and fight tax evasion.”

The G20 invited the OECD to develop a global standard on automatic exchange of information in 2013, and remains the driving force behind the move toward greater tax transparency worldwide.

The new standard draws extensively on previous OECD work on the automatic exchange of information. It incorporates progress made in this area within the European Union and the ongoing efforts to reinforce global anti-money laundering standards. It also recognises the role that implementation of the U.S. Foreign Account Tax Compliance Act (FATCA) has played in the G20 move towards automatic exchange of information in a multilateral context.

More than 40 countries have committed to early adoption of the standard. The OECD is expected to deliver a detailed Commentary on the new standard, as well as technical solutions to implement the actual information exchanges, during a meeting of G20 finance ministers in September 2014.