FATCA (Foreign Account Tax Compliance Act), a US law whose objective is to fight against tax evasion schemes that use foreign accounts or entities held by US taxpayers, became effective as of 1 July, 2014.
Non-American financial intermediaries are required to identify US taxpayers in their client data bases in order to report to the American tax authorities the income of direct or indirect beneficiaries who are US taxpayers concerned by the legislation, thereby allowing an automated cross check with their individual tax returns. The refusal (by non-American financial intermediaries or by clients) to respect these obligations could be penalized by the application of a punitive withholding tax of 30% on certain payments.
Societe Generale’s objective is to better serve its individual and institutional clients and to help them in their own compliance efforts in order to access our entire range of products and services without suffering FATCA withholding tax.
Societe Generale group complies with FATCA obligations
Societe Generale is registered in France, one of the “Partner” countries that have agreed to take an intergovernmental approach with the US authorities to implement FATCA. The objectives of fiscal transparency are attained through reporting to national authorities and through tax information exchange between Partner countries based on existing bilateral tax conventions and intergovernmental agreements. In all Partner countries that have signed IGAs, the governments agree to transpose FATCA obligations into local law and thereby have it apply to all financial institutions located physically in the country including branches of foreign companies.
For Societe Generale, compliance with FATCA therefore depends on the terms of the IGAs signed by the countries in which the financial establishment is located which could have specific requirements regarding the US regulation that apply to non-signatory countries.
Concerned financial institutions have to be registered with the IRS which will attribute a FATCA identification number (Global Intermediary Identification Number or GIIN) that will be used to prove their compliance to third-parties.
Certain other financial institutions of the Group benefit from a deemed compliant status or are out of the scope of FATCA (meaning they are not required to register) and are not required to have a GIIN. In addition, certain financial institutions located in countries in which local law strictly prohibits the application of FATCA have a transition period until the end of 2016 to become compliant. Societe Generale will ensure their conformity as soon as possible and up to this date these entities will declare themselves non-compliant with FATCA (no GIIN until validated registration).
The list of the Group’s financial entities registered with the IRS for FATCA purposes and their corresponding GIINs is updated on a monthly basis on our website.