Budget Implementation Act, 2016, No. 2  Madam Speaker, I thank my colleague for his very important question. When FATCA was introduced by the United States, there was much negotiation between our two countries on this issue. I will say that we do not want to overburden any institution with regulatory burden and extra cost, but we need to balance that with having institutions conform to global financial standards that are introduced, whether it is with the United States or Europe, that we agree to, and we have agreed to that.

Budget Implementation Act, 2016, No. 2  It really discriminates against small credit unions throughout this country and has caused a fair bit of grief, particularly as we already have similar American regulations to deal with, known as FATCA. My question is this. Does the member support these common reporting standards as they are or does he believe, like many credit unions, that they do need to be changed taking into account the different structures of credit unions in this country?

Budget Implementation Act, 2016, No. 1  Lastly, in the budget document there was some talk about credit unions, particularly when it came to international FATCA rules. FATCA was a big issue in the last Parliament. However, more or less, Canadian institutions, all shapes and sizes, have been able to follow up with it. Now the government is talking with other governments about offshore tax evasion, bringing international FATCA regulations, a different regime, to Canada, whether a small institution has sufficient foreign nationals investing their money and a large percentage is not.

Finance committee  Yes. FATCA applies to the U.S. This new measure applies to OECD countries, so to a much larger number of countries.

Finance committee  To this end, CCUA urges the federal government to apply a risk-based approach wherein institutions qualifying under an annually applied test would be exempt from CRS obligations. This is similar to the approach that we applied under FATCA, the current bilateral tax agreement with the U.S., and it makes sense to apply it for the common reporting standard. Thank you for the opportunity to speak today. We look forward to your questions.

Information & Ethics committee  The tax laws, as you know, are fundamentally international because there are agreements between countries to ensure that tax is recovered. Those are usually reflected in law, with FATCA being the most recent and most publicized example. It's definitely enforceable. It's definitely accompanied by restrictions, and those restrictions stem from privacy law. In other words, would the federal government send tax information, through a request from, let's say, the French government?

Finance committee  Yes, as we mentioned, we have 259 members, which includes the U.S., already included under the FATCA.

Information & Ethics committee  If a financial institution, Canadian as far as we are concerned, is not compliant with FATCA, FATCA requires U.S. payers, that is, corporations and other entities that pay amounts such as interest or dividends, making certain payments of U.S.-source income to this financial institution, to withhold tax equal to 30% of the payment.

Information & Ethics committee  We've also requested clarification as to why the first round of records sent to the IRS was larger than originally estimated. In conclusion, FATCA reporting requirements are an example of co-operation among states on tax enforcement. In that respect, FATCA is neither unusual nor objectionable. That said, privacy principles have to be respected and provide balance in the implementation of the arrangement.

Questions Passed as Orders for Returns  With regard to the exchange of information between Canada and the United States (US) under the Foreign Account Tax Compliance Act (FATCA): (a) how many individuals were reported, in total and broken down by (i) Canadian citizens, (ii) permanent residents of Canada, (iii) temporary residents of Canada; (b) how many individuals were reported, broken down by (i) individuals with Canadian addresses, (ii) individuals with US addresses, (iii) individuals with addresses in other countries; (c) how many accounts were reported, in total and broken down by (i) bank accounts, (ii) credit union accounts, (iii) investment accounts, (iv) insurance accounts, (v) other types of accounts; (d) with respect to (c)(iii), what types of insurance accounts were reported; (e) with respect to (c)(v), what other types of accounts were reported; (f) of the accounts reported, how many were (i) under $50,000 US, (ii) between $50,000 and $1,000,000 US, (iii) over $1,000,000 US; (g) of the accounts reported, how many were (i) Registered Retirement Savings Account accounts, (ii) Registered Education Savings Account accounts, (iii) Registered Disability Savings Account accounts, (iv) Tax Free Savings Account accounts; (h) of the accounts reported, how many were held jointly with one or more non US persons, broken down by type of account and indicating the type of relationship between the joint account holder and the US person, if it is known; (i) how many accounts of organizations were reported to the IRS because a US person had signing authority, interest in, or other connection to the organization; (j) of the accounts that were reported, how many were (i) business accounts, (ii) professional accounts, (iii) charitable or non-profit organization accounts, (iv) connected to other organizations, broken down by type of organization; (k) what agency, organization, and individuals was the information provided to; (l) what measures were taken to ensure this information will not be provided to any other agency, organization, and individuals; (m) what measures were taken to ensure that information transmitted will not be subject to identity theft, fraud, other criminal activities, or breach of privacy; (n) how many records did Canada receive from the US, in total and broken down by (i) individuals who live in Canada, (ii) individuals who live in the US, (iii) individuals who live in other countries, broken down by country; (o) how many accounts did Canada receive information about; (p) what type of information was in the records Canada received; (q) did Canada receive information regarding (i) income from the accounts, (ii) total assets in accounts, (iii) account balances, (iv) transactions, deposits and withdrawals, (v) account numbers, (vi) names of account holders, (vii) Social Insurance Numbers, (viii) other related information; (r) what type of information did Canada receive that was not provided by the US prior to the FATCA Intergovernmental Agreement; and (s) when did Canada receive the information?

Information & Ethics committee  After we had obtained all the information about FATCA, we clearly would still have entered into agreements with the United States. FATCA is an American act. The position that was taken at the time really allowed the Canadian banking system, and Canadians with dual citizenship, to be protected.

Information & Ethics committee  The financial institutions are aware of this kind of information exchange. I must emphasize that, if the agency had not signed an agreement with FATCA, the information exchange would be done by the banks. The fact that the agency is involved and that agreements have been reached with FATCA, allows us to protect the information even more and to respect confidentiality and privacy.

Information & Ethics committee  I believe this was one of the matters raised when FATCA was negotiated, because it was not perhaps very reciprocal. I would like to hear your opinion.

Information & Ethics committee  Therrien, I have a quick question for you. So far this morning we've concentrated on individual personal accounts, but the FATCA also includes commercial accounts for commercial enterprises. Because that information is also privy to the agreement, in your estimation, do you feel that commercial information that is sent to the United States would be secure?

Information & Ethics committee  I just have a quick question. It's another arbitrary question. When the United States under FATCA asks a Canadian institution about a particular bank account, is there a threshold? It can go from zero to whatever, so is there a certain threshold? You talked about the administrative burden for banks, so I'm just wondering what the administrative burden is in terms of the level they're seeking and whether you believe it's an appropriate level.