FAQs
Skip information indexFinancial institutions not subject to reporting obligation. No filers of form 290
To entities that meet the requirements of the applicable regulations issued by the United States Treasury for consideration as an exempt beneficial owner, as an excepted foreign financial institution or as a foreign financial institution considered compliant, which, by application of the Agreement, do not have the consideration of a Spanish financial institution obliged to communicate information.
With respect to shares that are marketed through a registration system in global accounts on behalf of third parties, the provisions of section 2 of said letter will apply. Therefore, the investment fund will be considered a Spanish financial institution not obliged to communicate information if the requirements set out in Annex II of the Agreement are met, with the obligations corresponding to the marketer in whose name said units are registered.
Regarding the shares that are registered in the registry of the managing entity in the name of the participant, the provisions of section 1 of said letter will apply.
Both types of companies conduct insurance activity. Therefore, according to the provisions of Article 1.1 of the Agreement and of Article 2.3 of the Order, they shall be considered financial institutions (Specific Insurance Company) only in the case that they offer products that, according to the Agreement, could be considered insurance contracts with a cash value or an annuities contract, or if they are required to make payments in relation to said contracts.
Furthermore, and notwithstanding the provisions of letter q), Paragraph 1 Article 1 of the Agreement, Section I.C.2. of Appendix II of the Agreement states that mutual insurance companies whose members are all employees and whose protection partners or promoters are companies, institutions or sole proprietors in which they provide their services and the services they provide are only a result of insurance agreements among the former and that latter, that is, business mutual insurance companies, are considered Spanish financial institutions not required to communicate information, with the status or condition of exempt effective beneficiary. The foregoing can be considered applicable, mutatis mutandis, to voluntary social insurance organisations considered comparable.
As for the requirement to register, mutual insurance companies and voluntary social insurance organisations are not required to register with the US Tax Administration if they do not have the status of specific Insurance Company for the purposes of the Agreement, or if, despite having this status, meet the requirements to be considered Spanish financial institutions not required to communicate information based on what is stated in the previous paragraph.
With regard to EPSV pension plans, it should be considered that they are included in Paragraph C.1 Section I of Appendix II of the Agreement, with the status or condition of exempt effective beneficiary.
In order for a sponsored entity or a sponsored investment vehicle to be considered financial institutions not required to report information, it must be a sponsored investment entity, a sponsored controlled foreign company, or a sponsored investment vehicle with a small number of investors, depending on are defined in sections C and D of section II of Annex II of the Agreement and have agreed with a sponsoring entity that it fulfills, on their behalf, the obligations referred to in the aforementioned sections and in the terms indicated in the themselves.
The requirement states that the financial institution may not have a fixed place of business outside Spain. For this purpose, premises outside Spain that are used exclusively for administrative functions and are not advertised to clients are not considered a fixed place of business outside Spain.