Ukraine enacts procedure for applying Common Reporting Standard - finance ministry

MOSCOW. July 17 (Interfax) - The Common Reporting Standard and Due Diligence for Financial Account Information, which the Ukrainian Finance Ministry approved on May 26, took effect on Monday, Ukrainian media reported citing the Finance Ministry's statement.

The common standard sets procedures and rules that financial organizations need to comply with to collect information about reportable accounts and its verification in due manner, the statement said.

The standard defines information that a reporting financial institution must identify and include in its report on each reportable account, sets requirements for due diligence in order to identify reportable accounts and describes due diligence procedures with respect to pre-existing and new individual and entity accounts, the media said.

The document also sets out special additional rules for the completion of procedures, in particular those for aggregating account balances and currency translation.

The document also defines the procedure for a reporting financial organization to discharge of its duties, including with respect to defining its status, applying of due diligence measures to financial accounts, introducing by a financial organization of rules to regulate a due diligence of financial accounts in order to identify their reportability for the purposes of the Multilateral Competent Authority Agreement.

The Common Reporting Standard is an international standard adopted by the OECD Council on July 15, 2014, the Ukrainian Finance Ministry said. It requires the countries implementing it to collect information from financial institutions about financial accounts of account owners and exchange such information annually on the automatic basis with jurisdictions of the signatories to the Multilateral Competent Authority Agreement.

As of January 2023, over 110 jurisdictions, including all European Union member states, were involved in the international automatic exchange of financial account information.

In August 2021, the Ukrainian government sent a letter to the OECD Secretariat to formally express intent to implement the Common Reporting Standard and become a signatory to the Multilateral Competent Authority Agreement.

In August 2022, the Ukrainian State Tax Service joined the Multilateral Competent Authority Agreement, which stipulates bringing national laws line with the Common Reporting Standard.