The Luxembourg government released on 20 February 2020 a draft law amending the Luxembourg law on FATCA and on CRS.

The Draft Law:

  1. introduces the obligation for Luxembourg Reporting Financial Institutions (“FI”) to file a “nil-report” in the absence of reportable accounts under CRS.
  2. introduces new penalties for non-compliance with CRS and FATCA rules: a fine of EUR 10,000 that may for example apply in case a FI does not comply with the nil-report obligation within the required deadline.
  3. explicitly requires Luxembourg Reporting FI to record (during 10 years) actions taken and evidence used in a specific register in order to ensure the fulfilment of their reporting and due-diligence obligations.
  4. requires Luxembourg Reporting FI to implement policies, procedures and IT systems which shall be proportionate to the nature, specificities and size of the FI for the purpose of fulfilling FATCA and CRS obligations.
  5. clarifies Luxembourg Tax Authorities’ powers of investigation.

If the Draft Law is enacted this year, the above provisions are expected to enter into force as from 1 January 2021.

EFA shall produce and file the nil-report for its clients.

We are closely following the regulatory changes related to CRS and FATCA and will keep its clients informed on potential impacts.

For more information, please do not hesitate to contact us with this form