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For The Government Of The Republic Of Latvia And The Government Of The United States Of America Agreement On International Tax Duties And The Law On Foreign Account Tax Obligations (Fatc) Introduction

Original Language Title: Par Latvijas Republikas valdības un Amerikas Savienoto Valstu valdības līgumu par starptautisko nodokļu pienākumu izpildes uzlabošanu un likuma par ārvalstu kontu nodokļu pienākumu izpildi (FATCA) ieviešanu

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The Saeima has adopted and promulgated the following laws of Valstsprezident: the Government of the Republic of Latvia and the Government of the United States of America agreement on international tax duties and the law on foreign account tax obligations (FATC) introduction article 1. 2014 Latvia signed on 27 June for the Government of the Republic and the Government of the United States of America agreement on international tax duties and the law on foreign account tax obligations (FATC) introduction (hereinafter the agreement) and its memorandum of understanding with this law is adopted and approved. 2. article. Contractual commitments coordinated by the Ministry of finance. 3. article. The agreement shall enter into force for the period specified in article 10 and in order, and the Ministry of Foreign Affairs shall notify the official Edition of the "journal". 4. article. The law shall enter into force on the day following its promulgation. With the law put a contract in English and its translation into Latvian language. The Parliament adopted the law in 2014 on December 4. The President a. Smith in Riga 2014 11 December agreement between the Government of the United States of America and the Government of the Republic of Latvia to improve International Tax compliance and it implementations that FATC whereat, the Government of the United States of America and the Government of the Republic of Latvia (each, a "Party" and together, the "parties") desire to conclud an agreement to improve international tax compliance through mutual assistance in tax matters based on an effective infrastructure for the automatic exchange of information; Whereas, article 27 of the Convention between the United States of America and the Republic of Latvia for the avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on income, done at Washington on January 15, 1998, (the "Convention"), the exchange of authoriz information for tax purpose, including on an automatic basis; Whereas, the United States of America enacted provision is commonly known as the Foreign account Tax Compliance Act ("FATC"), which introduce a reporting regime for financial institutions with respect to certain accounts; Whereas, the Government of the Republic of Latvia is supportive of the underlying policy goals of FATC it improves tax compliance; Whereas, the FATC has raised a number of issues, including the Latvian financial institutions, you may not be able to comply with certain aspects of the FATC due to domestic legal impediment; Whereas, the Government of the United States of America collect information regarding certain accounts maintained by U.S. financial institutions held by residents of Latvia and is committed to exchanging such information with the Government of the Republic of Latvia and pursuing equivalent level of Exchange, provided that the appropriate safeguards and infrastructure for an effective relationship with the Exchange in place; Whereas, the parties are committed to working together over the longer term towards achieving common reporting and due diligence standards for financial institutions; Whereas, the Government of the United States of America acknowledg the need to line the reporting obligation under the FATC with others U.S. tax reporting obligation of Latvian financial institutions to avoid duplicativ of the reporting; Whereas, an intergovernmental approach would address the implementation of the FATC legal impediment and reduce burden for Latvian financial institutions; Whereas, the parties desire to conclud an agreement to improve international tax compliance and provide for the implementation of the FATC based on domestic reporting and automatic exchange reciprocal pursuan to the Convention, and subject to the confidentiality protection provided for therein and others, including the provision for limiting the use of the information exchanged under the Convention; Now, therefore, the parties have agreed as follows: article 1 For the purpose of 1Definition. of this agreement and any annex of theret ("agreement"), the following terms shall have the meaning set forth below: a) the term "United States" means the United States of America, including the States thereof, but does not include the U.S. territories. Any reference to a "State" of the United States includes the District of Columbia. (b)), the term "U.S. Territory" means American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, the Commonwealth of Puerto Rico, or the U.S. Virgin Islands. (c)), the term "is" means the U.S. Internal Revenue Service. (d)) the term "United States" means the Republic of Latvia. e) the term "Partner Jurisdiction" means (a) the jurisdiction that has in effect an agreement with the United States in their implementation of the FATC facilitat. The IRS shall publish a list identifying all Partner Jurisdiction. f) the term "Competent Authority" means: (1) in the case of the United States, the Secretary of the Treasury or his delegate; and (2) in the case of Latvia, the Ministry of finance or its authorised representative. g) the term "Financial Institution" means (a) the Custodial Institution, a Depository Institution, an investment Entity, or a Specified Insurance Company. h) the term "Custodial Institution" means any Entity that holds, as a substantial portions of its business, financial assets for the account of others. An entity holds financial assets for the account of others as a substantial portions of its business if the entity's gross ' income attributabl to the holdings of financial assets and related financial services equal or exceeds 100 at 20 percent of the entity's gross ' income during the shorter of: (i) the three-year period that ends on December 31 (or the final day of a non-calendar year accounting period) prior to the year in which the determination is being mad; or (ii) the period during which the entity has been in existenc. I) the term "Depository Institution" means any Entity that accept deposits in the ordinary course of a banking or similar business. j) the term "investment Entity" means any Entity that conduct as a business (or is managed by an entity that conduct as a business) one or more of the following activities or operations for or on behalf of a customer: (1) trading in money market instruments (cheque, bills, certificates of deposit, counterparties, etc.); Foreign Exchange; Exchange, interest rate and index instruments; transferabl securities; or commodity futures trading; (2) individual and collective portfolio management; or (3) otherwise investing, administering or managing funds or money, on behalf of the other person. This subparagraph (l) (j) shall be interpreted in a manner consistent with similar language set forth in the definition of "financial institution" in the Financial Action Task Force recommendations. k) the term "Specified Insurance Company" means any Entity that is an insurance company (or the holding company of an insurance company) that issues, or is obligated to make payments with respect to, (a) the Cash value insurance contract or an Annuity contract. l) the term "Latvian Financial Institutions" means (i) any Financial Institution organized under the laws of Latvia, but excluding any branch of such Financial Institution that is located outside Latvia, and (ii) any branch of a Financial Institution not organized under the laws of Latvia, if such branch is located in Latvia. m) the term "Financial Institution Partner Jurisdiction" means (i) any Financial Institution established in a Partner Jurisdiction, but excluding any branch of such Financial Institution that is located outside the Jurisdiction, and (ii) partners in any branch of a Financial Institution not established in the Jurisdiction, if the Partner such branch is located in the Partner Jurisdiction. n) the term "Reporting Financial Institution" means (a) the Latvian Financial Institutions Reporting Reporting or a U.S. Financial Institution, as the context requires. o) the term "Latvian Financial Institutions Reporting" means any Latvian Financial Institution that is not a Non-Latvian Financial Institutions Reporting. p) the term "U.S. Financial Institutions Reporting" means (i) any Financial Institution that is resident in the United States, but excluding any branch of such Financial Institution that is located outside the United States, and (ii) any branch of a Financial Institution not resident in the United States, if such branch is located in the United States, provided that the Financial Institution or branch has control , receipt, or custody of the income with respect to which information is required to be exchanged under subparagraph (2) (b) of article 2 of this agreement. The term "Non-Latvian Financial Institutions Reporting" means any Latvian Financial Institutions or other Entities, resident in the United Kingdom, that is described in Annex II as a Non-Latvian Financial Institutions Reporting or that otherwise had to be deemed a-compliant FFI the main beneficial owner under the United Nations or relevant U.S. Treasury regulations. The term "Financial Institution Nonparticipating" means (a) a nonparticipating FF, as that term is defined in the relevant U.S. Treasury regulations, but does not include (a) the Latvian Financial Institutions or other Financial Institutions other than Jurisdiction (a) the Partner Financial Institutions Financial Institutions treated as a Nonparticipating pursuan to subparagraph 2 (b) of article 5 of this agreement or the òàæó provision in an agreement between the United States and a Partner Jurisdiction. The term "Financial account" means an account maintained by a Financial Institution, and includes: (1) in the case of an Entity that is (a) a Financial Institution solely because it is an investment Entity, any equity or debt interest (other than interest that are regularly traded on an established securities market) in the Financial Institutions; (2) in the case of a Financial Institution described in subparagraph l note (s) (g) of this article, any equity or debt interest in the Financial Institution (other than interest that are regularly traded on an established securities market), if (i) the value of the debt or equity interest is determined, directly or indirectly, primarily by reference to assets that give rise to the U.S. source payments, Withholdabl and (ii) the class of interests was established with a purpose of «avoiding reporting in accordanc with this agreement; and (3) any Cash value insurance contract and any Annuity contract issued or maintained by a Financial Institution, other than a nontransferabl of noninvestmen-linked, immediate life annuity that is issued to an individual and monetizes a pension or disability benefit provided under an account that is excluded from the definition of Financial account in Annexe II. Notwithstanding the foregoing, the term "Financial account" does not include any account that is excluded from the definition of Financial account in Annexe II. For the purpose of this agreement, interests with "regularly traded" if there is a meaningful volume of trading with respect to the interests on an ongoing basis, and an "established securities market" means an Exchange that is officially recognized and supervised by a governmental authority in which the market is located and that has a meaningful annual value of shares traded on the Exchange. For the purpose of this subparagraph l (s), an interest in a Financial Institution is not "regularly traded" and shall be treated as a Financial account if the holder of the interest (other than a Financial Institution acting as an intermediary) is registered on the books of such Financial Institutions. The preceding line will not apply to interests first registered on the books of such Financial Institutions prior to July 1, 2014, and with respect to their interests first registered on the books of Financial Institutions on or after such July 1, 2014, a Financial Institution is not required to apply the preceding line is prior to January 1, 2016. The term "Depository account" includes any commercial, checking, savings, time, or thrift account, or an account that is evidenced by a certificate of deposit, certificate, thrift investment certificate, the certificate of indebtednes, or other similar instrument maintained by a Financial Institution in the ordinary course of a banking or similar business. A Depository account also includes an amount held by an insurance company guaranteed investment pursuan to a contract or similar agreement to pay or credit interest thereon. The term "Custodial Account" means an account (other than an insurance contract or Annuity contract) for the benefit of another person that holds any financial instrument or contract held for investment (including, but not limited to, (a) the share or stock in a corporation, (a) a bond, note, or other evidence, the debentur of indebtednes, a currency or a commodity transaction, a credit default swap (a) based upon a nonfinancial, swap index, a notional principal contract, an insurance contract or Annuity contract, and any options or other counterparties of the instrument). The term "Equity interest" means, in the case of a partnership, that is a Financial Institution, either (a) the capital or profits interest in the partnership. In the case of a trust that is a Financial Institution, an Equity Interest is held by any person considered to be treated as a settlor or beneficiary of all or portions of the trust (a), or any other natural person exercising ultimate effective control over the trust. (A) a Person shall be treated as Specified U.S. being a beneficiary of a foreign trust if such Specified Person has the U.S. right to receive directly or indirectly (for example, through a nomine) a mandatory distribution or may receive, directly or indirectly, (a) discretionary distributions from the trust. The term "insurance contract" means a contract (other than an Annuity contract) under which the issuer agree to pay an amount upon the occurrence of a specified contingency involving mortality, morbidity, accident, liability, or property risks. The term "Annuity contract" means a contract under which the issuer agree to make payments for a period of time determined in whole or in part by reference to the life expectancy of one or more individual. The term also includes a contract that is considered to be an Annuity contract in accordanc with the law, regulations, or practice of the jurisdiction in which the contract was issued, and under which the issuer agree to make payments for a term of years. The term "у) Cash value insurance contract" means an insurance contract (other than an indemnity reinsurance contract between two insurance companies) that has a value greater than $50.000 Cash. z) the term "Cash value" means the the greater of (i) the amount that the policyholder is entitled to receive upon surrender or termination of the contract (determined without reduction for any surrender charges or policy loan), and (ii) the amount the policyholder can borrow under or with regards to the contract. Notwithstanding the foregoing, the term "Cash value" does not include an amount payable under an insurance contract as: (1) a personal injury or benefit or others sicknes benefit providing indemnification of an economic loss incurred upon the occurrence of the event insured against; (2) a refund to the policyholder of a previously paid premium under an insurance contract (other than under a life insurance contract) due to policy cancellation or termination, decrease in risk exposure during the effective period of the insurance contract, or arising from a redetermination of the premium due to correction of posting or other similar error; or (3) a policyholder dividend based upon the experience of the underwriting contract or group involved. AA) the term ' Reportabl account ' means a U.S. account Reportabl or Reportabl, a Latvian account as the context requires. BB) the term "Latvian Reportabl account" means a Financial account maintained by a U.S. Financial Institution Reporting if: (i) in the case of a Depository account, the account is held by an individual resident in Latvia and more than $10 of interest is paid to such account in any given calendar year; or (ii) in the case of a Financial account other than a Depository account, the Account Holder is a resident of Latvia, including an Entity that certif that it is resident in the United Kingdom for tax purpose, with respect to which U.S. source income that is subject to reporting under chapter 3 or chapter 61 of the subtitle A of subtitle F of the U.S. Internal Revenue Code is paid or credited. CC) the term "U.S. Reportabl account" means a Financial account maintained by a Latvian Financial Institutions held by the Reporting and one or more Specified Persons in the U.S. or by a Non-U.S. Entity with one or more Controlling Person that is a Specified U.S. Person. Notwithstanding the foregoing, an account shall not be treated as a U.S. Reportabl account if such account is not identified as a U.S. Reportabl account after application of the due diligence procedures in Annexe i. dd) the term "Account Holder" means the person listed or identified as the holder of a Financial account by the Financial Institution that maintains the account. (A) a person, other than a Financial Institution, holding a Financial account for the benefit or account of another person as agent, custodian, nomine, signatory, investment advisor, or intermediary, is not treated as holding the account for purpose of this agreement, and such other person is treated as holding the account. For the purpose of the immediately preceding line, the term "Financial Institution" does not include (a) a Financial Institution organised or incorporated in a U.S. Territory. In the case of a Cash value insurance contract or an Annuity contract, the Account Holder is any person entitled to access the Cash value or change the beneficiary of the contract. If the person can access the Cash value or change the beneficiary, the Account Holder is any person named as the owner in the contract and any person with a vested entitlement to payment under the terms of the contract. Upon the maturity of a Cash value insurance contract or an Annuity contract, each person entitled to receive a payment under the contract is treated as an Account Holder. The term "U.S. Person" means (a) a U.S. citizen or resident individual, a partnership or corporation organized in the United States or under the laws of the United States or any State thereof, (a) a trust if (i) a court within the United States would have authority under applicable law to render a judgment concerning the order or substantially all issues regarding administration of the trust , and (ii) one or more U.S. persons have the authority to control all substantial decisions of the trust, or an estate of a deceden this is a citizen or resident of the United States. This subparagraph (ee) shall be interpreted in the l in accordanc with the U.S. Internal Revenue Code. The term "Specified U.S. Person" means a Person, other than the U.S.: (i) a corporation, the stock of which is regularly traded on one or more established securities markets; (ii) any corporation that is a member of the same affiliated group, as defined in the expanded section 1471 (e) (2) of the U.S. Internal Revenue Code, as a corporation described in clause (i); (iii) the United States or any agency or instrumentality thereof wholly owned; (iv) any State of the United States, any U.S. Territory, any political subdivision of any of the foregoing, or any agency or instrumentality of any wholly owned one or more of the foregoing; (v) any organization under section 501 main from taxation (a) of the U.S. Internal Revenue Code or an individual retirement plan as defined in section 7701 (a) (37) of the U.S. Internal Revenue Code; (vi) any bank as defined in section 581 of the U.S. Internal Revenue Code; (VII) any real estate investment trust as defined in section 856 of the U.S. Internal Revenue Code; (VIII) any regulated investment company as defined in section 851 of the U.S. Internal Revenue Code or any entity registered with the U.S. Securities and Exchange Commission under the investment Company Act of 1940 (15 U.S.C. 80A -64); (ix) any common trust fund as defined in section 603 (a) of the U.S. Internal Revenue Code; (x) any trust that is main from tax under section 664 (c) of the U.S. Internal Revenue Code or that is (a) described in section 4947 (1) of the U.S. Internal Revenue Code; (xi) a dealer in securities, commodities, or financial instrument counterparties (including notional principal contracts, futures, forwards, and options) that is registered as such under the laws of the United States or any State; (XII) a broker as defined in section 6045 (c) of the U.S. Internal Revenue Code; or (XIII) any tax-main trust under a plan that is described in section 403 (b) or section 457 (g) of the U.S. Internal Revenue Code. Gg) the term "Entity" means a legal person or a legal through a such as a trust. HH) the term "Non-U.S. Entity" means an Entity that is not a U.S. Person. II) the term "U.S. source of Withholdabl payment" means any payment of interest (including any original issue discount), dividends, rents, salar, WAGs, premium, annuit, compensation, remuneration, emolument, and others fixed or determinabl of annual or periodical gains, profits, and income, if such payment is from sources within the United States. Notwithstanding the foregoing, a U.S. source Withholdabl a payment does not include any payment that is not treated as a payment of withholdabl in the relevant U.S. Treasury regulations. JJ) An Entity is a "Related Entity" of another Entity if either Entity controls the other Entity, or the two Entities under common control with the Office. For this purpose the control includes a direct or indirect ownership of more than 50 percent of the vote or value in an Entity. Notwithstanding the foregoing, the Corporation may treat an Entity as not a Related Entity of another Entity if the two Entities in the not members of the same affiliated group as defined in section expanded 1471 (e) (2) of the U.S. Internal Revenue Code. KK) the term "U.S. TIN" means a taxpayer identifying number the federal U.S.. LL) the term "Latvian TIN" means (a) the Latvian taxpayer identifying number. mm) the term "Controlling Person" means the natural person who exercise control over an Entity. In the case of a trust, such term means the settlor, the Trustees, the protector (if any), the class of beneficiar a beneficiar or to any other natural person, and exercising ultimate effective control over the trust, and in the case of a legal to others than through a trust, such term means a person in a similar position or equivalent. The term "Controlling Person" shall be interpreted in a manner consistent with the Financial Action Task Force recommendations. 2. Any term not otherwise defined in this Agreement shall, unless the context otherwise requires or the Competent authorities to agree to a common meaning (as permitted by domestic law), have the meaning that it has at that time under the law of the Party applying this agreement, any meaning under the applicable tax laws of that Party prevailing over a meaning given to the term under other laws of that Party. Article 2Obligation to Obtain and Exchange Information with respect to their Reportabl accounts 1. Subject to the provision of article 3 of this agreement, each Party shall obtain the information specified in paragraph 2 of this article with respect to all of Reportabl accounts and shall annually Exchange this information with the other Party on an automatic basis pursuan to the provision of article 27 of the Convention. 2. The information to be obtained and exchanged is: a) In the case of Latvia with respect to each U.S. Reportabl account of each Reporting Financial Institutions: Latvian (1) the name, address, and TIN of each Specified Person U.S. U.S. that is an Account Holder of such account and, in the case of a Non-U.S. Entity that, after application of the due diligence procedures set forth in Annex I , is identified as having one or more Controlling Person that is a Specified U.S. Person, the name, address, and TIN (if any) in the U.S. of such entity and each such Specified U.S. Person; (2) the account number (or functional equivalent in the absence of an account number); (3) the name and identifying number of the Latvian Financial Institutions Reporting; (4) the account balance or value (including, in the case of a Cash value insurance contract or Annuity contract, the Cash value or surrender value) as of the end of the relevant calendar year or other appropriate reporting period or, if the account was closed during such year, immediately before closur; (5) in the case of any Custodial account: (A) the total gross amount of interest, the total gross amount of dividend, and the total gross amount of other income generated with respect to the assets held in the account, in each case paid or credited to the account (or with respect to the account) during the calendar year or other appropriate reporting period; and (B) the total gross proceed from the sale or redemption of the property paid or credited to the account during the calendar year or other appropriate reporting period with respect to which the Reporting Financial Institutions acted as a Latvian custodian, broker, nomine, or otherwise as an agent for the Account Holder; (6) in the case of any Depository account, the total gross amount of interest paid or credited to the account during the calendar year or other appropriate reporting period; and (7) in the case of any account not described in subparagraph 2 (a) (5) or 2 (a) (6) of this article, the total gross amount paid or credited to the Account Holder with respect to the account during the calendar year or other appropriate reporting period with respect to which the Latvian Financial Institutions Reporting is the debtor or obligor , including the aggregate amount of any redemption payments made to the Account Holder during the calendar year or other appropriate reporting period. (b)) In the case of the United States, with respect to each Reportabl Latvian account of each Reporting U.S. Financial Institutions: (1) the name, address, and TIN of any Latvian person that is a resident of Latvia and is an Account Holder of the account; (2) the account number (or the functional equivalent in the absence of an account number); (3) the name and identifying number of the Reporting U.S. Financial Institutions; (4) the gross amount of interest paid on a Depository account; (5) the gross amount of the dividends paid by U.S. source or credited to the account; and (6) the gross amount of other U.S. source income paid or credited to the account, to the exten the subject to reporting under chapter 3 or chapter 61 of the subtitle A of subtitle F of the U.S. Internal Revenue Code. Article 3Tim and Manner of exchange of Information For the purpose of 1 of the Exchange obligation in article 2 of this agreement, the amount and characterization of payments made with respect to a U.S. account Reportabl may be determined in accordanc with the principles of the tax law of Latvia, and the amount and characterization of payments made with respect to a Latvian Reportabl account may be determined in accordanc with principles of U.S. federal income tax law. 2. For the purpose of the exchange of the obligation in article 2 of this agreement, the information exchanged shall identify the currency in which each relevant amount is denominated. 3. With respect to paragraph 2 of article 2 of this agreement, the information is to be obtained and exchanged with respect to 2014 and all subsequent years, except this: a) In the case of Latvia: (1) the information to be obtained and exchanged with respect to 2014 is only the information described in subparagraph 2 (a) (1) through (4), 2 (a) of article 2 of this agreement; (2) the information to be obtained and exchanged with respect to 2015 is the information described in subparagraph 2 (a) (1) through 2 (a) (7) of article 2 of this agreement, except for gross proceed of subparagraph 2 (a) described in (5) (B) of article 2 of this agreement; and (3) the information to be obtained and exchanged with respect to 2016 and subsequent years is the information described in subparagraph 2 (a) (1) through 2 (a) (7) of article 2 of this agreement; (b)) In the case of the United States, the information to be obtained and exchanged with respect to 2014 and subsequent years is all of the information identified in subparagraph 2 (b) of article 2 of this agreement. 4. Notwithstanding paragraph 3 of this article, with respect to each Reportabl account that is maintained by (a) Reporting Financial Institutions as of June 30, 2014, and subject to paragraph 4 of article 6 of this agreement, the parties are not required to obtain and include in the exchanged information, the Latvian TIN or the U.S. TIN, as applicable, of any relevant person if such taxpayer identifying number is not in the records of the Reporting Financial Institutions. In such a case, the Parties shall obtain and include in the exchanged information, the date of birth of the relevant person, if the Reporting Financial Institutions has such date of birth records in it. 5. Subject to paragraphs 3 and 4 of this article, the information described in article 2 of this Agreement shall be exchanged within nine months after the end of the calendar year to which the information relate. 6. The Competent authorities of the United Kingdom and the United States shall enter into an agreement or through under the mutual agreement procedure provided for in article 26 of the Convention, which shall: (a) establish the procedures) for the automatic exchange of the obligation described in article 2 of this agreement; (b) rules and procedures prescrib) axis may be not the cessary implementations that article 5 of this agreement; and (c) establish procedures cessary not sharp) for the exchange of the information reported under subparagraph 1 (b) of article 4 of this agreement. 7. All information exchanged shall be subject to the confidentiality and others protection provided for in the Convention, including the provision for limiting the use of the information exchanged. 8. Following entry into force of this agreement, each Competent Authority shall provide written notification to the other Competent Authority when it is satisfied that the jurisdiction of the other Competent Authority has in place (i) appropriate safeguards to ensur that the information received it this pursuan agreement shall remain confidential and be used solely for tax purpose, and (ii) the infrastructure for an effective exchange relationship (including established processes for ensuring timely , accurate, and confidential information exchanges, effective and reliable communications, and demonstrated capabilities to promptly resolve questions and concerns about exchanges or requests for exchanges and to administer the provision of article 5 of this Agreement). The Competent authorities shall endeavor to be in good faith to meet, prior to September 2015, to establish that each jurisdiction has such safeguards and infrastructure in place. 9. The obligation of the parties to obtain and exchange information under article 2 of this Agreement shall take effect on the date of the later of the notifications described in paragraph 8 the written of this article. Notwithstanding the foregoing, if the Competent Authority is satisfied Latvian that the United States has the safeguards described in paragraph 8 and the infrastructure of this article in place, but additional time is not cessary for the U.S. Competent Authority to establish that Latvia has such safeguards and infrastructure in place, the obligation of the Corporation to obtain and exchange information under article 2 of this Agreement shall take effect on the date of the written notification provided by the Latvian Competent Authority to the U.S. Competent Authority pursuan to paragraph 8 of this article. 10. This agreement shall terminate on September 30, 2015, if article 2 of this agreement is not in effect for either Party to paragraph 9 of the pursuan article by that date. Article 4Application of Latvian Financial institutions the FATC 1. Treatment of Latvian Financial institutions Reporting. Each Reporting Financial Institutions shall be treated as Latvian complying with, and not subject to withholding under, section 1471 of the U.S. Internal Revenue Code if Latvia with its obligation to compl under articles 2 and 3 of this agreement with respect to such Reporting, and the Latvian Financial Institutions Reporting Financial Institutions: a Latvian) Reportabl ProFi to U.S. accounts and reports annually to the Latvian Competent Authority the information required to be reported in subparagraph 2 (a) of article 2 of This agreement in the manner described in time and article 3 of this agreement; (b)) for each of 2015 and 2016, reports annually to the Latvian Competent Authority the name of each Financial Institution to Nonparticipating which it has made payments and the aggregate amount of such payments; (c)) to the applicable compl with registration requirements on the IRS website; the FATC registration (d)) to the exten the Latvian Financial Institutions are Reporting a is (i) acting as a qualified intermediary (for the purpose of section 1441 of the U.S. Internal Revenue Code) that has elected to assume primary withholding responsibility under chapter 3 of Subtitle A of the U.S. Internal Revenue Code, (ii) a foreign partnership that has elected to act as a withholding foreign partnership (for the purpose of both sections 1441 and 1471 of the U.S. Internal Revenue Code) , or (iii) a foreign trust that has elected to act as a withholding foreign trust (for the purpose of both sections 1441 and 1471 of the U.S. Internal Revenue Code), withhold 30 percent of any U.S. source of payment to any Nonparticipating Withholdabl Financial Institutions; and e) in the case of a Latvian Financial Institutions Reporting that is not described in subparagraph 1 (d) of this article and that makes a payment of, or acts as an intermediary with respect to, (a) U.S. source of payment to any Nonparticipating Withholdabl Financial Institutions, the Latvian Financial Institutions Reporting provides to any immediate payor of such U.S. source of payment Withholdabl the information required for withholding and reporting it occure with respect to such payment. Notwithstanding the foregoing, (a) the Latvian Financial Institutions with respect to Reporting to which the conditions of this paragraph 1 shall not be satisfied are not subject to withholding under section 1471 of the U.S. Internal Revenue Code in Latvian Financial Institutions unless such Reporting is treated by the IRS as a Nonparticipating Financial Institutions to subparagraph pursuan 2 (b) of article 5 of this agreement. 2. Suspension of Rules Relating to Recalcitran accounts. The United States shall not require a Latvian Financial Institutions to withhold tax Reporting under section 1471 or 1472 of the U.S. Internal Revenue Code with respect to an account held by a recalcitran account holder (as defined in section 1471 (d) (6) of the U.S. Internal Revenue Code), or to close such account, if the U.S. Competent Authority receive the information set forth in subparagraph 2 (a) of article 2 of this agreement , subject to the provision of article 3 of this agreement, with respect to such account. 3. the Specific treatment of Latvian retirement plans. The United States shall treat as deemed compliant by the main-FF or the beneficial owner, as appropriate, for the purpose of sections 1471 and 1472 of the U.S. Internal Revenue Code, the Latvian retirement plans described in Annex II. For this purpose, a Latvian retirement plan includes an Entity established or located in, and regulated by, the Corporation, or a predetermined contractual or legal, operated through it provide pension or retirement benefits or earn income for providing such benefits under the law of Latvia and regulated with respect to contributions, distributions, sponsorship, and reporting, taxation. 4. the Identification and treatment of Others Deemed-compliant by the Beneficial Owner and the Main FF. The United States shall treat each Non-Latvian Financial Institutions Reporting a deemed-compliant FFI, or as the beneficial owner, the main United Nations as appropriate, for the purpose of section 1471 of the U.S. Internal Revenue Code. 5. Special Rules Regarding Related Entities and branches that the Nonparticipating Financial institutions. If a Latvian Financial Institutions, that otherwise meets the requirements described in paragraph 1 of this article or is described in paragraphs 3 or 4 of this article, has a Related Entity or branch that operate in a jurisdiction that prevents such Related Entity or branch from fulfilling the requirements of a participating FF or deemed-compliant FFI for the purpose of section 1471 of the U.S. Internal Revenue Code or has a Related Entity or branch that is treated as a Nonparticipating Financial Institutions solely due to the expiration of the transitional rule for limited and limited by the branch of the FFA under relevant U.S. Treasury regulations, such Latvian Financial Institutions shall continue to be in compliance with the terms of this agreement and shall continue to be treated as a deemed-compliant FFI, or a beneficial owner, main axis, for the purpose of appropriate section 1471 of the U.S. Internal Revenue Code , provided that: (a)) the Latvian Financial Institution treats each such Related Entity or branch as a separate Financial Institution for the purpose of Nonparticipating all the reporting and withholding requirements of this agreement and each such Entity or branch to identify Related itself to withholding agents as a Nonparticipating Financial Institutions; (b) each such Entity or branch Related) identified in its U.S. accounts and reports the information with respect to those accounts as required under section 1471 of the U.S. Internal Revenue Code to the exten the permitted under the relevant laws pertaining to the Related Entity or branch; and (c)) such Entity or branch does not Related specifically to U.S. accounts held by solici person that are not resident in the jurisdiction where such Related Entity or branch is located or accounts held by Financial institutions that Nonparticipating not established in the jurisdiction where such Related Entity or branch is located, and such Related Entity or branch is not used by the Latvian Financial Institutions or any other Related Entity the circumven the obligation under this agreement or under section 1471 of the U.S. Internal Revenue Code, as appropriate. 6. Coordination of Timing. Notwithstanding paragraphs 3 and 5 of article 3 of this agreement: (a) the Corporation shall not be obligated) to obtain and exchange information with respect to a calendar year that is prior to the calendar year with respect to which similar information is required to be reported to the IRS by participating in FF the relevant U.S. Treasury pursuan to regulations; (b) the Corporation shall not be obligated) to begin exchanging information prior to the date by which participating States with the required the FFA report similar information to the IRS under the relevant U.S. Treasury regulations; (c)) the United States shall not be obligated to obtain and exchange information with respect to a calendar year that is prior to the first calendar year with respect to which Latvia is required to obtain and exchange information; and (d)) the United States shall not be obligated to begin exchanging information prior to the date by which the Corporation is required to begin exchanging information. 7. Coordination of Definition with U.S. Treasury regulations. Notwithstanding article 1 of this agreement and the definition provided in the Annex to this agreement, in implementing this agreement, Latvia may use, and may permit Financial institutions to use Latvian, a definition in relevant U.S. Treasury regulations in lieu of a òàæó definition in this agreement, provided that such applications would not frustrat the purpose of this Agreement. Article 5Collaboration on compliance and enforcement 1. Minor and administrative errors. (A) the Competent Authority shall notify the Competent Authority of the other Party when the first-mentioned Competent Authority has reason to believe that administrative errors or other minor errors may have led to incorrect or incomplete information or other infringement reporting resulted in a of this agreement. The Competent Authority of such other Party shall apply its domestic law (including applicable penalties) to obtain corrected and/or complete information or to resolve other infringement of this agreement. 2. Significant Non-compliance. (a) the Competent Authority shall notify A) the Competent Authority of the other Party when the first-mentioned Competent Authority has determined that there is significant non-compliance with the obligations under this agreement with respect to a Reporting Financial Institutions in the other jurisdiction. The Competent Authority of such other Party shall apply its domestic law (including applicable penalties) to address the significant non-compliance described in the notice. (b)) If, in the case of a Latvian Financial Institutions Reporting, such enforcement actions do not resolve the non-compliance within a period of 18 months after notification of significant non-compliance is first provided by the United States shall treat the Latvian Financial Institutions Reporting a Nonparticipating Financial Institutions to this subparagraph pursuan 2 (b). 3. Reliance on Third Party service providers. Each Party may allow the Reporting Financial institutions to use third party service providers to fulfill the obligation is imposed on such Reporting Financial institutions by a Party, as contemplated in this agreement, but these shall remain the responsibility of the obligation of the Reporting Financial institutions. 4. Prevention of avoidance. The Parties shall not sharp cessary implementations that requirements to prevent Financial institutions from adopting practices intended to circumven the reporting required under this agreement. Article 6Mutual commitment to continue to enhance the effectiveness of Information Exchange and Transparency 1. Reciprocity. The Government of the United States's acknowledg the need to achieve an equivalent level of automatic reciprocal information exchange with Latvia. The Government of the United States is committed to further improve transparency and enhance the exchange relationship with Latvia by pursuing the adoption of regulations and relevant supporting legislation advocating and to achieve an equivalent level of reciprocal such automatic information exchange. 2. Treatment of Passthr of payments and gross Proceed. The parties are committed to work together, along with Partners, develop a Jurisdiction it practical and effective alternative approach to achieve the policy objective of foreign passthr payment and proceed for withholding that gross minimizes burden. 3. Development of Common Reporting and Exchange Model. The parties are committed to working with partners in the Jurisdiction, the Organisation for Economic Co-operation and development, and the European Union, on adapting the terms of this agreement and other agreements between the United States and Partner Jurisdiction to a common model for automatic exchange of information, including the development of reporting and due diligence standards for financial institutions. 4. Documentation of accounts Maintained as of June 30.2014. With respect to Reportabl accounts maintained by a Financial Institution as Reporting of June 30, 2014: a) the United States commit to establish, by January 1, 2017, for reporting with respect to 2017 and subsequent years, rules requiring Reporting U.S. Financial institutions to obtain and report the Latvian TIN of each account Holder of a Latvian Reportabl account as required to the subparagraph pursuan 2 (b) (1) of article 2 of this Agreement; and (b) commit to establish Corporation), by January 1, 2017, for reporting with respect to 2017 and subsequent years, rules requiring Financial institutions to obtain Latvian Reporting the U.S. TIN of each Specified Person as required by their U.S. pursuan subparagraph 2 (a) (1) of article 2 of this agreement. The article 7Consistency in the Application of the Jurisdiction of the FATC Partner shall be granted 1. Latvia the benefit of any more favorable terms under article 4 or Annex I of this Agreement relating to the application of the Latvian Financial institutions FATC afforded it in another Jurisdiction under the partners signed a bilateral agreement to which the other pursuan Partner Jurisdiction commit to undertak the same obligation as Latvia described in articles 2 and 3 of this agreement , and subject to the same terms and conditions as described therein and in articles 5 through 9 of this agreement. 2. The United States shall notify of any such corporation more favorable terms, and such more favorable terms shall apply automatically under this agreement as if such terms were specified in this agreement and effective as of the date of the signing of the agreement incorporating the more favorable terms, unless the Corporation in writing of the application declin thereof. Article 8Consultation and Amendments 1. In case any difficult to in the implementation of this agreement, either Party may request «arise the consultation to develop appropriate measure to ensur the fulfillment of this agreement. 2. This agreement may be amended by written mutual agreement of the parties. Unless otherwise is agreed upon, such an amendment shall enter into force, through the same procedures as set forth in paragraph 1 of article 10 of this agreement. Article 9Annex of the Annex forms an integral part of this agreement. Article 10Term of the agreement this agreement 1 shall enter into force on the date of written notification to the Corporation s ' the United States that Latvia has completed its internal procedures for entry cessary not into force of this agreement. 2. Either Party may terminate this agreement by giving notice of termination in writing to the other Party. Such termination shall become effective on the first day of the month following the expiration of a period of 12 months after the date of the notice of termination. 3. The Parties shall, prior to December 31, 2016, consult in good faith to amend this agreement as not to progress the cessary reflec on the commitment set forth in article 6 of this agreement. In witness whereof, the undersigned, being duly authorized by the by their respectiv theret in Governments, have signed this agreement. Done at Riga, in duplicate, in the English language, this 27th day of June, 2014.
For the Government OF the REPUBLIC OF Latvia: Minister of finance Andrew Wolf FOR the Government OF the UNITED STATES OF America: U.S. Ambassador to Latvia to Mark the ANNEXE I Pekal due diligence OBLIGATIONS FOR IDENTIFYING AND REPORTING ON U.S. REPORTABL accounts AND ON payments TO CERTAIN FINANCIAL institutions i. General NONPARTICIPATING. A. Corporation shall require that Latvian Financial institutions Reporting apply the due diligence procedures led in this Annex I to identify U.S. accounts and Reportabl accounts held by Financial Institutions for Nonparticipating. (B) For the purpose of the. Agreement, 1. All dollar non with in U.S. dollars and shall be read to include the equivalent in other currencies. 2. Except as otherwise provided herein, the balance or the value of an account shall be determined as of the last day of the calendar year or other appropriate reporting period. 3. Where a balance or value threshold is to be determined as of June 30, 2014 under this Annex I, the relevant balance or value shall be determined as of that day or the last day of the reporting period ending immediately before June 30, 2014, and where a balance or value threshold is to be determined as of the last day of a calendar year under this Annex I , the relevant balance or value shall be determined as of the last day of the calendar year or other appropriate reporting period. 4. Subject to subparagraph (l) of section II E of this Annex I, shall be treated as an account a U.S. Reportabl account beginning as of the date it is identified as such pursuan to the due diligence procedures in this Annex i. 5. Unless otherwise provided, the information with respect to a U.S. account shall be Reportabl reported annually in the calendar year following the year to which the information relate. С. As an alternative to the procedures described in each section of this Annex I, Latvia may permit Financial institutions to rely Reporting Latvian on the procedures described in the relevant U.S. Treasury regulations establish whethers it an account is a U.S. Reportabl account or an account held by a Financial Institution Nonparticipating. Latvia may permit Reporting Financial institutions the Latvian make such election separately for each section of this Annex (I) either with respect to all relevant Financial accounts or, separately, with respect to any clearly identified groups of such accounts (such as by line of business or the location of where the account is maintained). Ii. The Preexisting Individual Accounts. The following rules and procedures apply for the purpose of identifying U.S. Reportabl accounts among Preexisting accounts held by the individual (the "Preexisting Individual accounts"). Accounts Not Required to Be Reviewed, Identified, or Reported, Unless the Latvian Financial Institutions for Reporting Electa otherwise, either with respect to all Individual accounts or Preexisting, separately, with respect to any clearly identified groups of such accounts, where the implementing rules in Latvia provides for such an election, the following Preexisting Individual accounts are not required to be reviewed, identified, or reported as U.S. Reportabl accounts 1. Subject to subparagraph (E) (2) of this section, (a) the Preexisting Individual account with a balance or value that does not exceeds 100 $50.000 as of June 30, 2014. Subject to subparagraph 2 (E) (2) of this section, a Preexisting Individual account that is (a) a Cash value insurance contract or an Annuity contract with a balance of $250.000 or the value or less as of June 30, 2014.3. A Preexisting Individual account that is (a) a Cash value insurance contract or an Annuity contract, provided the law or regulations of the United Kingdom or the United States effectively prevent the sale of such a Cash value insurance contract or an Annuity contract to U.S. residents (e.g. , if the relevant Financial Institution does not have the required registration under U.S. law, and the law of Corporation requires reporting or withholding with respect to insurance products held by residents of Latvia). 4. A Depository account with a balance of $50.000 or less. B. Review Procedure for Preexisting Individual accounts With a balance or value as of June 30.2014, that 12 $50.000 ($ 250,000 for a Cash value insurance contract or Annuity contract), but does Not exceeds 100 $1,000,000 ("Lower value accounts"). 1. Electronic Records Search. The Latvian Financial Institutions must review Reporting electronically searchable data maintained by the Latvian Financial Institutions for Reporting any of the following: (a) Identification of the indicia U.S.) of the Account Holder as a U.S. citizen or resident; (b) the indication of a U.S. Unambiguo) place of birth; c) current U.S. mailing or residence address (including a U.S. post office box); d) current U.S. telephone number; (e) Standing instructions to transfer funds) to an account maintained in the United States; f) Currently effective power of attorney or signatory authority granted to a person with a U.S. address; or (g)) An "in-care-of ' or" hold mail "address that is the sole address the Latvian Financial Institutions Reporting has on file for the Account Holder. In the case of a Preexisting Individual account that is (a) a Lower value account, an "in-care-of address outside the United States or" hold mail "address shall not be treated as U.S. indicia. 2. If none of the listed in subparagraph (B) of the U.S. indicia (l) of this section are discovered in the electronic search, then from further action is required until there is a change in the results that circumstanc in one or more U.S.-being associated with the indicia account, or the account become a High value described in paragraph (D) account of this section. 3. If any of the listed in subparagraph (B) of the U.S. indicia (l) of this section are discovered in the electronic search, or if there is a change in the results that circumstanc in one or more U.S.-being associated with the indicia account, then the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account unless it is to apply subparagraph (B) Electa (4) of this section and the one of the exception in such subparagraph applies with respect to that account. 4. Notwithstanding a finding of U.S. under subparagraph (B) indicia (l) of this section, (a) the Latvian Financial Institutions Reporting is not required to treat an account as a U.S. Reportabl account if: (a)) where the Account Holder information unambiguously indicates a U.S. place of birth, the Latvian Financial Institutions obtain a Reporting, or has previously reviewed and maintains a record of: (1) A self-certification that the Account Holder is not a U.S. citizen nor a U.S. ither resident for tax purpose (of which may be on an IRS Form W-8 or other similar agreed form); (2) A non-U.S. passport or other Government-issued identification evidencing the Account Holder's citizenship or nationality ' in a country other than the United States; and (3) A copy of the Account Holder's ' certificate of loss of Nationality of the United States or a reasonable explanation of: (a) the reason the Account Holder does not have such a certificate despite relinquishing U.S. citizenship; or (b) the reason the Account Holder did not obtain U.S. citizenship at birth. (b)) where the Account Holder information contains a current U.S. mailing address ora residence, or one or more U.S. telephone number that with the only telephone numbers associated with the account, the Reporting Financial Institutions obtain Latvian, or has previously reviewed and maintains a record of: (1) A self-certification that the Account Holder is not a U.S. citizen nor a U.S. ither resident for tax purpose (which may be on an IRS Form W-8 or other similar agreed form); and (2) Documentary evidence, as defined in paragraph (D) of section VI of this Annex I, establishing the Account Holder's non-U.S. ' status. (c)) where the Account Holder information contains standing instructions to transfer funds to an account maintained in the United States, the Latvian Financial Institutions obtain a Reporting, or has previously reviewed and maintains a record of: (1) A self-certification that the Account Holder is not a U.S. citizen nor a U.S. ither resident for tax purpose (which may be on an IRS Form W-8 or other similar agreed form); and (2) Documentary evidence, as defined in paragraph (D) of section VI of this Annex I, establishing the Account Holder's non-U.S. ' status. (d)) where the Account Holder information contains a currently effective power of attorney or signatory authority granted to a person with a U.S. address, has an "in-care-of address or" hold Maira address that is the sole address identified for the Account Holder, or has one or more U.S. telephone number (if a non-U.S. telephone number is also associated with the account) , the Latvian Financial Institutions obtain a Reporting, or has previously reviewed and maintains a record of: (1) A self-certification that the Account Holder is not a U.S. citizen nor a U.S. ither resident for tax purpose (which may be on an IRS Form W-8 or other similar agreed form); or (2) Documentary evidence, as defined in paragraph (D) of section VI of this Annex I, establishing the Account Holder's non-U.S. ' status. C. Additional procedures applicable to their Preexisting Individual accounts that the Lower value accounts. 1. Review of Preexisting Individual accounts that the Lower value accounts for U.S. the indicia must be completed by June 30, 2016.2. If there is a change with respect to the of circumstanc a Preexisting Individual account that is (a) a Lower value account that results in one or more of the indicia described in subparagraph (B) U.S. (l) of this section being associated with the account , then the Latvian Financial Reporting Institutions must treat the account as a U.S. account of Reportabl unless subparagraph (B) (4) of this section applies. 3. Except for Depository accounts described in subparagraph (A) (4) of this section, any Preexisting Individual account that has been identified as a U.S. Reportabl account under this section shall be treated as a U.S. Reportabl account in all subsequent years, unless the Account Holder cease to be of a Specified U.S. Person. D. Enhanced Review procedures for Preexisting Individual accounts With a balance or value that exceeds 100 $1,000,000 as of June 30.2014, or December 31 or Any subsequent Year of 2015 ("High value accounts"). 1. Electronic Records Search. The Latvian Financial Institutions must review Reporting electronically searchable data maintained by the Latvian Financial Institutions for Reporting any of the indicia described in subparagraph (B) of the U.S. (l) of this section. 2. Paper Records Search. If the Latvian Financial Institutions Reporting ' s electronically searchable databases include fields for, and capture all of the information described in subparagraph (D), (3) of this section, then from further paper records search is required. If the electronic databases do not capture all of this information, then with respect to a High value account, the Latvian Financial Institutions Reporting must also review the current customer master file and the exten to note it led in the current customer master file, the following documents associated with the account and obtained by the Latvian Financial Institutions Reporting within the last five years for any of the indicia described in subparagraph (B) of the U.S. (l) of this section : a) the most recent documentary evidence collected with respect to the account; (b)) the most recent account opening contract or documentation; (c)) the most recent documentation obtained by the Latvian Financial Institutions Reporting to the RAL/KYC pursuan procedures or for other regulatory purpose; (d) the power of attorney or signature) Any authority forms currently in effect; and (e)) Any standing instructions to transfer funds currently in effect. 3. the Exception where the databases Contain Sufficient Information. A Latvian Financial Institutions Reporting is not required to perform the paper records described in subparagraph (D) search, (2) of this section if the Latvian Financial Institutions Reporting ' s electronically searchable information includes the following: a) the Account Holder ' s nationality or residence status; (b)) the Account Holder ' 's residence address and mailing address currently on file with the Latvian Financial Institutions Reporting; (c)) the Account Holder's telephone number ' (s) currently on file, if any, with the Latvian Financial Institutions Reporting; d) Whethers there are standing instructions to transfer funds in the account to another account (including an account at another branch of the Latvian Financial Institutions Financial Reporting or another Institution); e) Whethers there is a current "in-care-of address ' or" hold mail "address for the Account Holder; and (f)) Whethers there is any power of attorney or signatory authority for this account. 4. Relationship Manager Inquiry for Actual knowledge. In addition to the electronic and paper records searches described above, the Latvian Financial Reporting Institutions must treat as a U.S. Reportabl account any High value it assigned a relationship manager account (including any Financial accounts with such High aggregated value account) if the relationship manager has actual knowledge that the Account Holder is a Specified U.S. Person. 5. the effect of Finding U.S. Indicia. a) If none of the indicia is listed in U.S. (B) subparagraph (l) of this section are discovered in the enhanced review of High value accounts described above, and the account is not identified by a Specified Person as held U.S. (4) in subparagraph (D) of this section, then from further action is required until there is a change in the results that circumstanc in one or more U.S.-being associated with the indicia account. b) If any of the listed in subparagraph (B) of the U.S. indicia (l) of this section are discovered in the enhanced review of High value accounts described above, or if there is a subsequent change in that results of circumstanc in one or more U.S.-being associated with the indicia account, then the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account unless it is to apply subparagraph (B) Electa (4) of this section and the one of the exception for in such subparagraph applies with respect to that account. c) Except for Depository accounts described in subparagraph (A) (4) of this section, any Preexisting Individual account that has been identified as a U.S. Reportabl account under this section shall be treated as a U.S. Reportabl account in all subsequent years, unless the Account Holder cease to be of a Specified U.S. Person. E. Additional procedures applicable to High value accounts. 1. If a Preexisting Individual account is a High value account as of June 30, 2014, the Latvian Financial Reporting Institutions must complete the enhanced review procedures described in paragraph (D) of this section with respect to such account by June 30, 2015. If based on this review is identified as such account Reportabl account on a U.S. or before December 31 by 2014, the Latvian Financial Reporting Institutions must report the required information about such account with respect to 2014 in the first report on the account and on an annual basis thereafter. In the case of an account identified as a U.S. Reportabl account after December 31, 2014 and on or before June 30, 2015, the Latvian Financial Institutions Reporting is not required to report information about such account with respect to 2014, but must report information about the account on an annual basis thereafter. 2. If a Preexisting Individual account is not a High value account as of June 30, 2014, but become a High value of the account as of the last day of the calendar year or any subsequent in 2015, the Latvian Financial Reporting Institutions must complete the enhanced review procedures described in paragraph (D) of this section with respect to such account within six months after the last day of the calendar year in which the account to become a High value of the account. Based on this review if such account is identified as a U.S. account Reportabl, the Latvian Financial Reporting Institutions must report the required information about such account with respect to the year in which it is identified as a U.S. Reportabl account and subsequent years on an annual basis, unless the Account Holder cease to be of a Specified U.S. Person. 3. Once a Latvian Financial Institutions Reporting to the Apple enhanced review procedures described in paragraph (D) of this section to a High value account, the Latvian Financial Institutions Reporting is not required to re-apply such procedures, other than the relationship manager described in subparagraph (D) inquiry (4) of this section, the same High value account in any subsequent year. 4. If there is a change of the respect it a circumstanc with High value account that results in one or more of the indicia described in subparagraph (B) U.S. (l) of this section being associated with the account, then the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account unless it is to apply subparagraph (B) Electa (4) of this section and the one of the exception in such subparagraph applies with respect to that account. 5. (A) the Latvian Financial Institutions must Report implementations that procedures to ensur that a relationship manager to identify any change in circumstanc of an account. For example, if a relationship manager is notified that the Account Holder has a new mailing address in the United States, the Latvian Financial Institutions Reporting is required to treat the new address as a change in circumstanc and, if it is to apply subparagraph (B) Electa (4) of this section, is required to obtain the appropriate documentation from the Account Holder. F. Preexisting Individual accounts that have Been Documented for Certain Other Purpose. A Latvian Financial Institutions Reporting that has previously obtained documentation from an Account Holder to establish the Account Holder's status as No ' ither a U.S. citizen nor a U.S. resident in order to meet its obligation under a qualified intermediary, foreign partnership, or withholding withholding foreign trust agreement with the IRS, or to fulfill its obligation under chapter 61 of title 26 of the United States Code , is not required to perform the procedures described in subparagraph (B) to (l) of this section with respect to the Lower value accounts or subparagraph D (l) through (D) (3) of this section with respect to High value accounts. Iii. New Individual Accounts. The following rules and procedures apply for the purpose of identifying U.S. Reportabl accounts among Financial accounts held by individual and opened on or after July 1, 2014 (the "New" Individual accounts "). A. accounts Not Required to Be Reviewed, Identified, or Reported. Unless the Latvian Financial Institutions for Reporting Electa otherwise, either with respect to all New Individual accounts separately, or, with respect to any clearly identified groups of such accounts, where the implementing rules in Latvia provides for such an election, the following New Individual accounts are not required to be reviewed, identified, or reported as U.S. Reportabl accounts: 1. A Depository account unless the account balance exceeds 100 for $50.000 at the end of any calendar year or other appropriate reporting period. 2. (A) the Cash value insurance contract unless the Cash value exceeds 100 for $50.000 at the end of any calendar year or other appropriate reporting period. B. Other New Individual Accounts. With respect to New Individual accounts described in note (A) of this paragraph, section, upon account opening (or within 90 days after the end of the calendar year in which the account of a cease to be described in paragraph (A) of this section), the Latvian Financial Institutions Reporting must obtain a self-certification, which may be part of the account opening documentation, that allows the Reporting Financial Institutions it is determin Latvian whethers the Account Holder is resident in the United States for tax purpose (for this purpose, a U.S. citizen is considered to be resident in the United States for tax purpose, even if the Account Holder is also a tax resident of another jurisdiction) and confirm the reasonablenes of such self-certification based on the information obtained by the Latvian Financial Institutions Reporting in connection with the opening of the account, including any documentation collected pursuan to RAL/KYC procedures. 1. If the self-certification of establish that the Account Holder is resident in the United States for tax purpose, the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account and obtain a self-certification that includes the Account Holder's U.S. ' TIN (which may be an IRS Form W-9 or other similar agreed form). 2. If there is a change of with respect of circumstanc to a New Individual account that causes the Latvian Financial Institutions Reporting to know, or have reason to know, that the original self-certification is incorrect or unreliabl, the Latvian Financial Institutions Reporting cannot rely on the original self-certification and must obtain a valid self-certification that establish whethers of the Account Holder is a U.S. citizen or resident for U.S. tax purpose. If the Latvian Financial Institutions Reporting is unable to obtain a valid self-certification, the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account. Iv. Preexisting Entity Accounts. The following rules and procedures apply for the purpose of identifying U.S. accounts and Reportabl accounts held by Financial institutions among Nonparticipating Preexisting accounts held by Entities (the "Preexisting Entity accounts"). A. Entity accounts Not Required to Be Reviewed, Identified or Reported. Unless the Latvian Financial Institutions for Reporting Electa otherwise, either with respect to all Preexisting accounts or, separately, Entities with respect to any clearly identified groups of such accounts, where the implementing rules in Latvia provides for such an election, (a) the Preexisting Entity account with an account balance or value that does not exceeds 100 $250.000 as of June 30, 2014, is not required to be reviewed , identified, or reported as a U.S. Reportabl account until the account balance or value exceeds 100 $1,000,000. B. Entity accounts subject to Review. A Preexisting account Entity that has an account balance or value that exceeds 100 $250.000 as of June 30, 2014, and a Preexisting account Entity that does not exceeds 100 $250.000 as of June 30, 2014 but the account balance or the value of which exceeds 100 $1,000,000 as of the last day of or any subsequent calendar year 2015, must be reviewed in accordanc with the procedures set forth in paragraph (D) of this section. С Entity accounts With respect to Which Reporting Is Required. With respect to Preexisting Entities described in paragraph В of accounts this section, only accounts that are held by one or more Entities that are the Specified Person, or by U.S. passive NFF's with one or more Controlling Person who are U.S. citizens or residents, shall be treated as U.S. Reportabl accounts. In addition, accounts held by Financial institutions shall be treated Nonparticipating axis accounts for which aggregate payments as described in subparagraph 1 (b) of article 4 of the agreement with the Latvian Office reported it to the Competent Authority. D. Review Procedures for Identifying Entity accounts With respect to Which Reporting Is Required, For Preexisting Entities described in paragraph В accounts of this section, the Latvian Financial Institutions Reporting must apply the following review procedures to determin the whethers the account is held by one or more U.S. Persons, Specified by the NFF with passive one or more Controlling Person who are U.S. citizens or residents , or by Financial institutions: 1. Nonparticipating Determin Whethers of the Entity Is a Specified U.S. Person. (a) Review the information maintained for regulatory or) customer relationship purpose (including information collected pursuan to RAL/KYC procedures) to determin the whethers the information indicates that the account of the Holder is a U.S. Person. For this purpose, information indicating that the Account Holder is a U.S. Person includes a U.S. place of incorporation or organization, or a U.S. address. (b) If the information indicates the) that the Account Holder is a U.S. Person, the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account unless it obtain a self-certification from the Account Holder (which may be on an IRS Form W-8 or W-9, or a similar agreed form), or reasonably based on information in the determin its possession or that is publicly available , that the Account Holder is not a U.S. Person Specified. 3. (a) Determin the Whethers Non-U.S. Entity Is a Financial Institution. (a) Review the information maintained for regulatory or) customer relationship purpose (including information collected pursuan to RAL/KYC procedures) to determin the whethers the information indicates that of the Account Holder is a Financial Institution. (b) If the information indicates the) that the Account Holder is a Financial Institution, or the Latvian Financial Institutions Reporting to the Account Holder verif ' s Global Identification Number Intermediary on the published list, FF is then the account is not a U.S. Reportabl account. 3. a Financial Institution (a) Determin Whethers Is a Nonparticipating Financial Institutions Which are Subject to payments to Aggregate the Reporting Under Subparagraph Kb) of article 4 of the agreement. (a) subject to subparagraph (D)) (3) (b) of this section, (a) the Latvian Financial Institutions may determin Reporting that the Account Holder is a Latvian Financial Institutions or other Financial Institutions if the Jurisdiction Partner Reporting Financial Institutions reasonably determin the Latvian that the Account Holder has such status on the basis of the Account Holder's Intermediary ' Global Identification Number on the published list is FF or other information that is publicly available or in the possession of the Reporting Latvian Financial Institutions, as applicable. In such case, no further review, identification, or reporting is required with respect to the account. (b)) If the Account Holder is a Latvian Financial Institutions or other Financial Institutions treated Jurisdiction by the Partners is as a Financial Institution, then the Nonparticipating account is not a U.S. Reportabl account, but payments to the Account Holder must be reported as contemplated in subparagraph 1 (b) of article 4 of the agreement. (c) If the Account Holder) is not a Latvian Financial Institutions or other Financial Institutions, Jurisdiction Partners then the Latvian Financial Reporting Institutions must treat the Account Holder as a Nonparticipating Financial Institutions which it shall reportabl payments of under subparagraph 1 (b) of article 4 of the agreement, unless in the Latvian Financial Institutions Reporting: (1) Obtain a self-certification (which may be on an IRS Form W-8 or similar agreed form) from the Account Holder that it is deemed a certified-compliant FF, or the beneficial owner, the main United Nations as those terms are defined in the relevant U.S. Treasury regulations; or (2) In the case of a participating in FFA or registered deemed-compliant FFI, the Account Holder to verif ' s Global Identification Number Intermediary on the FF list is published. 4. the Whethers Determin an account Held by an NFF Is a U.S. Reportabl account. With respect to an Account Holder of a Preexisting account Entity that is not identified as either a U.S. Person or a Financial Institution, the Financial Institution must identify the Reporting Latvian (i) whethers the Account Holder has the Controlling Person, (ii) the whethers the Account Holder is a passive NFF, and (iii) any of the Person Controlling the whethers of the Account Holder is a U.S. citizen or resident. In making a determination of these the Latvian Financial Reporting Institutions must follow the guidance in subparagraph (D) (4) (a) through (D) (4) (d) of this section in the order most appropriate under the circumstanc. (a) For the purpose of determining) the Controlling Person of an Account Holder, a Latvian Financial Institutions may rely on Reporting information collected and maintained to RAL/pursuan KYC procedures. (b) For the purpose of determining whethers) the Account Holder is a passive NFF, the Latvian Financial Institutions Reporting must obtain a self-certification (which may be on an IRS Form W-8 or W-9, or on a similar agreed form) from the Account Holder to establish its status, unless it has information in its possession or that is publicly available, based on which it can reasonably determin that the Account Holder is an active NFF. (c) For the purpose of determining whethers) a Controlling Person of a passive NFF is a U.S. citizen or resident for tax purpose, a Latvian Financial Institutions may rely on the report: (1) Information collected and maintained to RAL/KYC pursuan Procedure in the case of a Preexisting Entity account held by one or more of the NFF with an account balance or value that does not exceeds 100 $1,000,000; or (2) A self-certification (which may be on an IRS Form W-8 or W-9, or on a similar agreed form) from the Account Holder or such Controlling Person in the case of a Preexisting Entity account held by one or more of the NFF with an account balance or value that exceeds 100 $1,000,000 If any Controlling Person d) of a passive NFF is a U.S. citizen or resident , the account shall be treated as a U.S. Reportabl account. E. Timing of Review and Additional procedures applicable to their Preexisting Entity accounts. 1. Review of Preexisting Entity accounts with an account balance or value that exceeds 100 $250.000 as of June 30, 2014 must be completed by June 30, 2016.2. Review of Preexisting Entity accounts with an account balance or value that does not exceeds 100 $250.000 as of June 30, 2014, but exceeds 100 $1,000,000 as of December 31 of the year in 2015 or any subsequent , must be completed within six months after the last day of the calendar year in which the account balance or value exceeds 100 $1,000,000.3. If there is a change with respect to the of circumstanc a Preexisting account Entity that causes the Latvian Financial Institutions Reporting to know, or have reason to know, that the self-certification or other documentation associated with an account is incorrect or the unreliabl , the Latvian Financial Institutions must redetermin Reporting the status of the account in accordanc with the procedures set forth in paragraph (D) of this section. V. New Entity Accounts. The following rules and procedures apply for the purpose of identifying U.S. accounts and Reportabl accounts held by Financial institutions among Nonparticipating Financial accounts held by Entities and opened on or after July 1, 2014 (the "New Entity accounts"). A. Entity accounts Not Required to Be Reviewed, Identified or Reported. Unless the Latvian Financial Institutions for Reporting Electa otherwise, either with respect to all the New Entity accounts or, separately, with respect to any clearly identified groups of such accounts, where the implementing rules in the United States provide for such election, a credit card account or revolving credit facility (a) treated as a New Entity account is not required to be reviewed, identified, or reported , provided that the Latvian Financial Institutions Reporting in maintaining such account implements policies and procedures to prevent an account balance owed table to the Account Holder for that $50.000 12. B. Other New Entity accounts. With respect to the New Entity not described in paragraph (A) accounts of this section, the Latvian Financial Institutions must Report the whethers determin the Account Holder is: (i) a Specified U.S. Person; (ii) a Latvian Financial Institutions or other Financial Institutions Jurisdiction Partners; (ii) a participating FF, a deemed-compliant FFI, or the beneficial owner, the main United Nations as those terms are defined in the relevant U.S. Treasury regulations; or (iv) an active or passive NFF NFF. 1. Subject to subparagraph (B) (2) of this section, (a) the Latvian Financial Institutions may determin Reporting that the Account Holder is an active NFF, a Latvian Financial Institutions, or other Partner Financial Institutions Reporting Jurisdiction if the Latvian Financial Institutions reasonably determin the that the Account Holder has such status on the basis of the Account Holder Identification Number Intermediary ' s Global or other information that is publicly available or in the possession of the Latvian Financial Institutions Reporting , as applicable. 2. If the Account Holder is a Latvian Financial Institutions or other Financial Institutions treated Jurisdiction by the Partners is as a Financial Institution, then the Nonparticipating account is not a U.S. Reportabl account, but payments to the Account Holder must be reported as contemplated in subparagraph 1 (b) of article 4 of the agreement. 3. In all other cases, a Latvian Financial Institutions Reporting must obtain a self-certification from the Account Holder to establish the Account Holder s ' status. Based on the self-certification, the following rules apply: (a)) If the Account Holder is a Specified Person, the U.S. Financial Institutions Reporting Latvian must treat the account as a U.S. Reportabl account. (b)) If the Account Holder is a passive Reporting NFF, the Latvian Financial Institutions must identify the Controlling Person as determined under RAL/KYC Procedure, and must in any such person whethers determin is a U.S. citizen or resident on the basis of a self-certification from the Account Holder or such person. If any such person is a U.S. citizen or resident, the Latvian Financial Reporting Institutions must treat the account as a U.S. Reportabl account. (c) If the Account Holder) is: (i) a U.S. Person that is not a Specified U.S. Person; (ii) subject to subparagraph (B) (3) (d) of this section, (a) the Latvian Financial Institutions or other Financial Institutions Jurisdiction Partners; (ii) a participating FF, a deemed-compliant FFI, or the beneficial owner, the main United Nations as those terms are defined in the relevant U.S. Treasury regulations; (iv) an active NFF; or (v) a passive NFF non of the Controlling Person of which is a U.S. citizen or resident, then the account is not a U.S. Reportabl account, and no reporting is required with respect to the account. (d)) If the Account Holder is a Financial Institution Nonparticipating (including a Latvian Financial Institutions or other Financial Institutions treated Jurisdiction by the Partners is a Financial Institution as a Nonparticipating), then the account is not a U.S. Reportabl account, but payments to the Account Holder must be reported as contemplated in subparagraph 1 (b) of article 4 of the agreement. Vi. Special rules and Definition. The following additional rules will apply in implementing the Andean definition the due diligence procedures described above: a. reliance on Self-Certification and Documentary evidence. (A) Reporting Financial Institutions may not rely on Latvian a self-certification or documentary evidence if the Latvian Financial Institutions Reporting knows or has reason to know that the self-certification or documentary evidence is incorrect or unreliabl. B. Definition. The following definition will apply for the purpose of this Annex I. 1. RAL/KYC procedures. "RAL/KYC procedures" means the customer due diligence procedures of a Latvian Financial Institutions Reporting pursuan to the anti-money laundering or similar requirements of Latvia Latvian Financial Institutions to which such Reporting is subject. 2. the NFF. An "NFF" means any Non-U.S. Entity that is not an FFI, as defined in the relevant U.S. Treasury regulations or is an Entity described in subparagraph (B) (4) (j) of this section, and also includes any Non-U.S. Entity that is established in Latvia or another Jurisdiction and the Partner that is not a Financial Institution. 3. Passive NFF. A "passive NFF" means any NFF that is not (i) an active NFF, or (ii) a withholding foreign partnership or withholding foreign trust pursuan to relevant U.S. Treasury regulations. 4. active NFF. An "active NFF" means any NFF that meets any of the following criteria: (a)) less than 50 percent of the NFF is ' 's gross income for the preceding calendar year or other appropriate reporting period is passive income and less than 50 percent of the assets held by the NFF Office during the preceding calendar year or other period with the appropriate reporting assets that produce or are held for the production of passive income; (b)) the stock of the NFF is regularly traded on an established securities market or the NFF is a Related Entity of an Entity the stock of which is regularly traded on an established securities market; (c)), the NFF is organized in a U.S. Territory and all of the owners of the paye with a bona fide residents of the U.S. Territory you; (d)) the NFF is a Government (other than the U.S. Government), a political subdivision of such Government (which, for the avoidance of doubt, includes (a) a State, province, county, or municipality), or a public body performing a function of such Government or political subdivision thereof, (a) (a) the Government of a U.S. Territory, an international organization, a non-U.S. central bank of issue, or an Entity wholly owned by one or more of the foregoing; e) Substantially all of the activities of the NFF has consis of holdings (in whole or in part) the outstanding stock of, or providing financing and services it, one or more subsidiar that engage in trades or businesses other than the business of a Financial Institution, except the NFF is the United Nations shall not qualify you for this status if the NFF is a function (or holds itself out) as an investment fund , such as a private equity funds, venture capital funds, leveraged buyout fund, or any investment vehicle whose purpose is to acquir or fund companies and then hold interests in those companies as capital assets for investment purpose; (f)), the NFF is not yet operating a business and has from prior operating history, but is investing capital into assets with the intent to operate a business other than that of a Financial Institution, provided that the NFF Office shall not qualify for this exception after the date that is 24 months after the date of the initial organization of the NFF; (g)) the NFF was not a Financial Institution in the past five years, and is in the process of liquidating its assets or the is reorganizing with the intent to continue or recommenc operations in a business other than that of a Financial Institution; the NFF is primarily) engage in financing and hedging transactions with, or for, the Related Entities that are not Financial institutions, and does not provide services to any financing or hedging Entity that is not a Related Entity, provided that the group of any such Related Entities primarily engaged in is in a business other than that of a Financial Institution; I) the NFF is an "excepted NFF" as described in the relevant U.S. Treasury regulations; or j) the NFF Office meets all of the following requirements: (i) It is established and operated in its jurisdiction of residence exclusively for religious, charitable, scientific, artistic, cultural, athletic, or educational purpose; or it is established and operated in its jurisdiction of residence and it is a professional organization, business, chamber of Commerce League, labor organizations, agricultural or horticultural organizations, civic League or an organization operated exclusively for the promotion of social welfare; II. t is main from income tax in its jurisdiction of residence; III. It has from a shareholder or members who have a proprietary or beneficial interest in it income or assets; IV. The applicable law of the NFF's jurisdiction of residence of the ' or the ' of the NFF's formation documents do not permit any income or assets of the NFF to be distributed to, or applied for the benefit of, a private person or a non-charitable Entity other than pursuan to the conduct of the NFF is ' 's charitable activities, or as payment of reasonable compensation for services rendered , or as payment representing the fair market value of the property which the NFF has purchased; and (v). The applicable law of the NFF's jurisdiction of residence of the ' or the ' of the NFF's formation documents require that, upon the liquidation or dissolution of the NFF's ', all of its assets be distributed to a governmental entity or other non-profit organizations, or the Government it esche of the NFF is ' 's jurisdiction of residence or any political subdivision thereof. 5. a Preexisting account. (A) "Preexisting account" means the account maintained by (a) (a) Financial Reporting Financial Institutions as of June 30, 2014. the account balance Aggregation and Currency Translation rules. 1. the Aggregation of Individual accounts. For the purpose of determining the aggregate balance or value of Financial accounts held by an individual, a Latvian Financial Institutions Reporting is required to aggregate all Financial accounts maintained by the Latvian Financial Institutions, or by Reporting a Related Entity, but only to the exten to that the Latvian Financial Institutions Reporting ' 's computerized systems link the Financial accounts by reference to a data element such as client number or taxpayer identification number , and allow account balance or values to be aggregated. Each holder of jointly held a Financial account shall be attributed the entire balance or the value of the jointly held Financial account for the purpose of applying the aggregation requirements described in this paragraph 1.2. Aggregation of Entity accounts. For the purpose of determining the aggregate balance or value of Financial accounts held by an Entity, a Latvian Financial Institutions Reporting is required to take into account all Financial accounts that are maintained by the Latvian Financial Institutions, or by Reporting a Related Entity, but only to the exten to that the Latvian Financial Institutions Reporting ' 's computerized systems link the Financial accounts by reference to a data element such as client number or taxpayer identification number , and allow account balance or values to be aggregated. 3. Special Rules applicable to Aggregation Relationship Manager. For the purpose of determining the aggregate balance or value of Financial accounts held by a person in (a) determin whethers the Financial account is a High value account, a Latvian Financial Institutions Reporting is also required, in the case of any Financial accounts that a relationship manager knows, or has reason to know, is directly or indirectly owned, controlled, or "(other than in a fiduciary capacity) by the same person their aggregate all such accounts. 4. Currency Translation rule. For the purpose of determining the balance or value of Financial accounts denominated in a currency other than the U.S. dollar, a Latvian Financial Institutions Reporting must convert the U.S. dollars threshold described in this Annex is non I into such currency using a published spot rate determined as of the last day of the calendar year preceding the year in which the Reporting Institution is determining the Latvian Financial balance or value. D. Documentary Evidence. For purpose of this Annex, the documentary evidence I acceptabl includes any of the following: 1. A certificate of residence issued by an authorized government body (for example, a Government or agency thereof, or a municipality) of the jurisdiction in which the paye claims to be a resident of the. 2. With respect to an individual, any valid identification issued by an authorized government body (for example, a Government or agency thereof, or a municipality), that includes the individual's name ' and is typically used for identification purpose. 3. With respect to an Entity, any official documentation issued by an authorized government body (for example, a Government or agency thereof, or a municipality) that includes the name of the Entity and either the address of its principal office in the jurisdiction (or U.S. Territory) in which it claims to be a resident or the jurisdiction (or U.S. Territory) in which the Entity was incorporated or organized. 4. With respect to a Financial account maintained in a jurisdiction with an anti-money laundering rules that have been approved by the IRS in connection with a QI agreement (as described in the relevant U.S. Treasury regulations), in any of the documents, other than a Form W-8 or W-9, referenced in the ' jurisdiction's attachment to the QI agreement for identifying individual or Entities. 5. Any financial statement, third-party credit report, bankruptcy filings, or the U.S. Securities and Exchange Commission report. E. alternative procedures for Financial accounts Held by the Individual to the Cash value of a Beneficiar insurance contract. A Latvian Financial Institutions Reporting in may that an individual beneficiary presum (other than the owner) of a Cash value insurance contract receiving a death benefit is not a U.S. Person and Specified may treat such Financial account as other than a U.S. Reportabl account unless the Latvian Financial Institutions Reporting has actual knowledge, or reason to know, that the beneficiary is a Specified U.S. Person. (A) Reporting Financial Institutions has reason to know Latvian that (a) the beneficiary of a Cash value insurance contract is a U.S. Person if the Specified information collected by the Latvian Financial Institutions Reporting and associated with the beneficiary contains indicia described in subparagraph U.S. axle (B) (1) of section II of this Annex I (a) Reporting Financial Institution. If Latvian has actual knowledge , or reason to know, that the beneficiary is a Specified Person, the U.S. Reporting Financial Institutions must follow Latvian the procedures in subparagraph (B) (3) of section II of this Annex i. f. reliance on Third parties. Regardless_of of an election is made under whethers paragraph of section I of this С Annexe I, Latvia may permit Reporting Financial Institutions rely on Latvian it due diligence procedures performed by third parties, to the exten the provided in the relevant U.S. Treasury regulations. Annex II the following shall be treated as Entities to be deemed beneficial owner or main-compliant FF, as the case may be, and the following accounts are excluded from the definition of Financial accounts. This Annex II may be modified by a mutual written decision entered into between the Competent authorities of the United Kingdom and the United States: (1) to include additional Entities and accounts that present a low risk of being used by a Person of the nter U.S. U.S. tax and that have similar characteristics to the Entities and accounts described in this Annex II as of the date of signature of the agreement; or (2) to remove Entities and accounts that, due to changes in circumstanc, no longer present a low risk of being used by a Person of the nter U.S. U.S. tax. Any such addition or removal shall be effective on the date of signature of the mutual decision, unless otherwise provided for therein. Procedures for reaching such a mutual decision may be included in the mutual agreement or described in paragraphs 6 through a of article 3 of the agreement. I. the Beneficial owners other than Main funds. The following Entities shall be treated as a Non-Latvian Financial institutions Reporting and as a beneficial owner for the main purpose of sections 1471 and 1472 of the U.S. Internal Revenue Code, other than with respect to a payment that is derived from an obligation held in connection with a commercial financial activity of a type Specified in (a) engaged by Insurance Company in Custodial Institutions , or Depository Institution. A. Governmental Entity. The Government of Latvia, any political subdivision of the United Kingdom (which, for the avoidance of doubt, includes (a) a State, province, county, or municipality), or any agency or instrumentality of wholly owned corporation or any one or more of the foregoing (each, a "Latvian Governmental Entity"). This category is comprised of the integral parts, controlled entities, and political subdivisions of Latvia. 1. An integral part of any person, Corporation means, agency, Bureau, the organization funds instrumentality, or others, body, however designated, that (a) each of the authority of Latvia constitut. The net earnings of the each authority must be credited to its own account or the accounts of the other corporation, with portions of the benefit inuring them of any private person. An integral part does not include any individual who is a sovereign, official, or administrator acting in a private or personal capacity. 2. A controlled entity means an Entity that is separate in form from Latvia or that otherwise a separate juridical entity of the constitut, provided that: (a) the Entity is wholly owned) and controlled by one or more Governmental Entities to directly or through the Latvian one or more controlled entities; (b)) the Entity's net earnings with ' is credited to its own account or to the accounts of one or more Governmental Entities to Latvian, with from portions of it income benefit inuring to the of any private person; and ' с) the Entity's assets to bring in one or more Governmental Entities upon dissolution in Latvian. 3. Income does not to the benefit of inur of private person if such person with the intended beneficiar a of a governmental program, and the program activities are performed for the general public with respect to the common welfare or relate to the administration of some phase of Government. Notwithstanding the foregoing, however, income is considered to the the inur benefit of private persons if the income is derived from the use of (a) the governmental entity to conduct a commercial business, such as a commercial banking business that provides financial services to private individuals. B. International Organization. Any international organization or agency or instrumentality thereof wholly owned. This category includes any intergovernmental organization (including a supranational organization) (1) that is comprised primarily of the non-U.S. Governments; (2) that has in effect a headquarters agreement with Latvia; and (3) the income of which does not benefit to this inur of private persons. C. Central Bank. The Bank of Latvia (Latvijas Banka). II. Funds that Qualify as a Beneficial Owner of Main. The following Entities shall be treated as a Non-Latvian Financial institutions Reporting and as a beneficial owner for the main purpose of sections 1471 and 1472 of the U.S. Internal Revenue Code. A. Treaty-Qualified Retirement Fund. (A) a fund established in Latvia, provided that the fund is entitled to benefits under an income tax treaty between Latvia and the United States on income that it's deriv from sources within the United States (or would be entitled to such benefits if it derived any such income) as a resident of Latvia that to any applicable limitations on satisf benefits requirement , and is operated principally to administer or provide pension or retirement benefits. B. Broad Participation Retirement Funds. (A) a fund established in Latvia to provide retirement, disability, or death benefits, or any combination thereof, that with the beneficiar current or former employees (or a person designated by such employees) of one or more employers in the considerations for services rendered, provided that the fund: 1. Does not have a single beneficiary with a right to more than five percent of the fund's assets '; 2. Is subject to government regulations and provides annual information reporting about it is up to the relevant beneficiar authorities in Latvia; and to at least 3 Satisf one of the following requirements: (a)) the fund is generally main from tax in Latvia on investment income under the law of Latvia due to its status as a retirement or pension plan; (b)) the funds receive at least 50 percent of of its total contributions (other than a transfer of assets from other described in paragraph (A) of the plans through (D) of this section or from retirement and pension accounts described in subparagraph (A) of section V (l) of this Annex II) from the sponsoring employer; c) distributions or withdrawals from the fimd the allowed only upon the occurrence of specified events related to retirement, disability, or death (except the rollover distributions to other retirement funds described in paragraphs (A) through (D) of this section or retirement and pension accounts described in subparagraph (A) of section V (l) of this Annexe II), or penalties apply to distributions or withdrawals made before such specified events; or d) contributions (other than certain permitted make-up contributions) by employees to the fund with limited by reference to earned income of the employee or may not $50.000 annually exceeds 100, applying the rules set forth in Annex I for account aggregation and currency translation. C. Narrow Participation Retirement Fund. (A) a fund established in Latvia to provide retirement, disability, or death benefits it beneficiar that with current or former employees (or a person designated by such employees) of one or more employers in the considerations for services rendered, provided that: 1. The fund has fewer than 50 participants; 2. The fund is sponsored by one or more employers that are not investment Entities in or passive NFF; 3. The employee and employer contributions to the fund (other than a transfer of assets from the EU-qualified retirement funds described in paragraph (A) of this section or retirement and pension accounts described in (A) subparagraph (l) of section V of this Annex II) with limited by reference to earned income and compensation of the employee, respectively; 4. the participants that are not residents of Latvia are not entitled to more than 20 percent of the fund's assets '; and 5. The fund is subject to government regulations and provides annual information reporting about it is up to the relevant beneficiar tax authorities in Latvia. (D) the Pension Fund of the Main United Nations. Beneficial Owner. (A) a fund established in Latvia by the beneficial owner, the main United Nations provide retirement, disability, or death benefits to the participants that beneficiar or by current or former employees of the main the beneficial owner (or by a person designated by such employees), or that are not current or former employees, if the benefits provided to such participants with a beneficiar or in considerations of personal services performed for the main a beneficial owner. E. investment Entitv Whollv Owned a Beneficial Owner, Main bv, An Entity that is (a) the Latvian Financial Institutions solely because it is an investment Entity, provided that each direct holder of an Equity interest in the Entity is the beneficial owner, the main UN and each holder of a direct debt interest in such Entity is either (a) Depository Institutions (with respect to a loan made to such Entity) or the beneficial owner main United Nations. (F) The State Funded Pension Schemes.. State funded pension schemes, including investment plans established and regulated under the Law on State Funded Pension (State funded pensions Act), provided that such scheme satisf to the requirements of subparagraph 1 and 2, and at least one of the requirements of subparagraph 3 of paragraph В of this section. G. Private Pension Funds. Private pension funds established and regulated under the Law on private Pension funds (for private pension funds) provided that such fund to the satisf requirements of subparagraph 1 and 2, and at least one of the requirements of subparagraph 3 of paragraph В of this section. III. Small or Limited scope Financial institutions that Qualify as Deemed-compliant FF, the following Financial institutions with Non-Reporting Financial institutions that Latvian be treated as deemed IR-compliant for the purpose of section FF 1471 of the U.S. Internal Revenue Code. A. Financial Institutions with a Local client base, A Financial Institution satisfying the following requirements: 1. The Financial Institution must be a licensed and regulated as a financial institution under the law of Latvia; 2. The Financial Institutions must have of the fixed place of business outside of Latvia. For this purpose, a fixed place of business does not include (a) a location that is not advertised to the public and from which the Financial Institutions perform a solely administrative support functions; 3. The Financial Institutions must not solici customers or Account Holder outside Latvia. For this purpose, a Financial Institution shall not be considered to have solicited customer or Account Holder outside Latvia merely because the Financial Institutions (a) operate a website, provided that the website does not specifically indicates that the Financial Institution provides Financial accounts or services to nonresident, and does not target or otherwise to U.S. customers solici or Account Holder, or (b) advertise in print media or on a radio or television station that is distributed or aired primarily within Latvia but is also incidentally or aired in other countries distributed, provided that the advertisement does not specifically indicates that the Financial Institution provides Financial accounts or services to nonresident, and does not target or otherwise to U.S. customers solici or Account Holder; 4. The Financial Institutions must be required under the law of Latvia to identify resident Account Holder for the purpose of either information or withholding of tax reporting with respect to Financial accounts held by residents or for the purpose of satisfying Corporation ' s RAL due diligence requirements; 5. At least 98 percent of the Financial accounts maintained by the by value Financial Institutions must be held by residents (including residents of the are Entities) of the Corporation or a Member State of the European Union; 6. Beginning on or before July 1, 2014, the Financial Institution must have policies and procedures, consistent with those set forth in Annex I, to prevent the Financial Institutions from providing a Financial account to any Financial Institution and to monitor Nonparticipating whethers the Financial Institutions open or maintains a Financial account for any Specified Person who is not a U.S. resident of Latvia (including a U.S. Person, that was a resident of Latvia when the Financial account was opened but subsequently cease to be a resident of Latvia) or any passive NFF with Controlling Person who are U.S. residents or U.S. citizens who are not residents of Latvia; 7. Such policies and procedures must provide that if any Financial account held by a Specified Person who is not a U.S. resident of Latvia or by a passive Controlling People with NFF who are U.S. residents or U.S. citizens who are not residents of Latvia is identified, the Financial Institution must report such Financial account as would be required if the Financial Institution were a Latvian Financial Institutions (including Reporting by following the applicable registration requirements on the IRS The FATC registration website) or close such Financial account; 8. With respect to a Preexisting account held by an individual who is not a resident of Latvia or by an Entity, the Financial Institution must review those Preexisting accounts in accordanc with the procedures set forth in Annex I applicable to Preexisting accounts to identify any U.S. Reportabl account or Financial account held by a Financial Institution, and a Nonparticipating must report such Financial account as would be required if the Financial Institution were a Latvian Financial Institutions (including Reporting by following the applicable registration requirements on the IRS website) or the FATC registration close such Financial account; 9. Each Related Entities of the Financial Institution that is a Financial Institution must be incorporated or organized in the United States and, with the exception of any Related Entity that is (a) the retirement fund described in paragraphs (A) through (D) of section II of this Annex II, satisfy the requirements set forth in this paragraph (A); and 10. The Financial Institution must not have policies or practices that discriminat against opening or maintaining Financial accounts for individual who are U.S. Persons and Specified residents of Latvia. B. Local Bank. (A) the Financial Institution satisfying the following requirements: 1. The Financial Institutions operate solely as of (and is licensed and regulated under the law of Latvia as) (a) (a) or (b) a bank, credit union or similar cooperative credit organization that is operated without profit; 2. The Financial Institution's business is primarily ' consist of receiving deposits and making loans from them, with respect to a bank, retail customers and unrelated, with respect to a credit union or similar cooperative credit organizations, members, provided that from members has a greater than five percent interest in such credit union or cooperative credit organization; 3. The Financial Institution to the satisf requirements set forth in subparagraph (A) (A) (2) and (3) of this section, provided that, in addition to the limitations on the website described in subparagraph (A) (3) of this section, the website does not permit the opening of a Financial account; 4. The Financial Institution does not have more than $175 million in assets on its balance sheet, and the Financial Institutions and any Related Entities, taken together, do not have more than $500 million in total assets on their balance sheets consolidated or combined; 5. Any Related Entity and must be incorporated or organized in the United States, and any Related Entity that is (a) Financial Institutions, with the exception of any Related Entity that is (a) the retirement fund described in paragraphs (A) through (D) of section II of this Annex II or a Financial Institution with only low-value accounts described in paragraph of this section С , must satisfy the requirements set forth in this paragraph (B). Financial Institutions С. with Only Low-value accounts. A Latvian Financial Institutions satisfying the following requirements: 1. The Financial Institution is not an investment Entity; 2. From the Financial account maintained by the Financial Institution or any Related Entity has a balance or value in excess of $50.000, applying the rules set forth in Annex I for account aggregation and currency translation; and 3. The Financial Institution does not have more than $50 million in assets on its balance sheet, and the Financial Institutions and any Related Entities, taken together, do not have more than $50 million in total assets on their balance sheets consolidated or combined. D. Qualified Credit Card Issuer, A Latvian Financial Institutions satisfying the following requirements: 1. The Financial Institution is a Financial Institution solely because it is an issuer of credit cards that accept deposits only when a customer makes a payment in excess of (a) the balance due with respect to the card and the overpaymen is not immediately returned to the customer; and 2. Beginnings on or before July 1, 2014, the Financial Institutions implement policies and procedures to either prevent a customer deposit in excess of $50.000, or to ensur that any customer deposit in excess of $50.000, in each case applying the rules set forth in Annex I for account aggregation and currency translation, is refunded to the customer within 60 days. For this purpose, a customer deposit does not refer to credit balance to the exten of disputed charges but does include credit balance resulting from the return of the merchandise. IV. Investment Entities that Qualify as a Deemed-compliant FF and others Special Rules. The Financial institutions described in paragraphs (A) through (E) of this section with the Non-Reporting Financial institutions that Latvian be treated as deemed IR-compliant for the purpose of section FF 1471 of the U.S. Internal Revenue Code. In addition, paragraph (F) of this section provides special rules applicable to an investment Entity. A. Trustee-Documented trust A trust established under the laws of the United States to the exten that the trustee of the trust is a U.S. Financial Institutions Reporting in the Reporting, Model 1 FF, or Participating in FF and reports all information required to be reported pursuan to the agreement with respect to all U.S. Reportabl accounts of the trust. B. investment Entity and Controlled Foreign Sponsored Corporation. (A) a Financial Institution described in subparagraph (B) to (l) or (B) (2) of this section having a sponsoring entity that compl to with the requirements of subparagraph (B) (3) of this section. 1. A Financial Institution is a sponsored investment entity if (a) it is an investment Entity established in the Corporation that is not a qualified intermediary, foreign partnership, or withholding withholding foreign trust pursuan to relevant U.S. Treasury regulations; and (b) an Entity has agreed with the Financial Institutions to act as a sponsoring entity for the Financial Institutions. 2. A Financial Institution is a controlled foreign corporation sponsored if (a) the Financial Institution is a controlled foreign corporation organized under the laws of England that is not a qualified intermediary, foreign partnership, or withholding withholding foreign trust pursuan to relevant U.S. Treasury regulations; (b) the Financial Institutions is wholly owned, directly or indirectly, by a U.S. Financial Institution Reporting that agree to act, or requires an affiliate of the Financial Institutions to act as a sponsoring entity for the Financial Institutions; and (c) the Financial Institutions share a common electronic account system with the sponsoring entity that enable the sponsoring entity to identify all account holders and of the Financial Institutions of the paye and to access all account and customer information maintained by the Financial Institution including, but not limited to, customer identification information, customer documentation, account balance, and all payments made to the Account Holder or paye. 3. The sponsoring entity to compl with the following requirements: (a) the sponsoring entity is authorized) to act on behalf of the Financial Institution (such as a fund manager, trustee, corporate director, or managing partner) to fulfill applicable registration requirements on the IRS website; the FATC registration (b) the sponsoring entity) has registered as a sponsoring entity with the is on the IRS website; the FATC registration (c) If the sponsoring entity identifier) to any U.S. Reportabl accounts with respect to the Financial Institutions, the sponsoring entity to register in the Financial Institutions it pursuan applicable registration requirements on the IRS website on the registration or FATC before the later of December 31, 2015 and the date that is 90 days after such a U.S. Reportabl account is first identified; (d) the sponsoring entity) agree to perform, on behalf of the Financial Institution, all due diligence, withholding, reporting, and other requirements that the Financial Institution would have been required to perform if it were a Latvian Financial Institutions Reporting; (e) the sponsoring entity to identify) the Financial Institutions and includes the identifying number of the Financial Institution (obtained by following applicable registration requirements on the registration of the website is a FATC) in all Financial Institutions reporting completed on the ' 's behalf; and (f)) the sponsoring entity has not had its status revoked as a sponsor. С. Sponsored By Closely Held Investment Vehicle. A Latvian Financial Institutions satisfying the following requirements: 1. The Financial Institution is a Financial Institution solely because it is an investment Entity and is not a qualified intermediary, foreign partnership, or withholding withholding foreign trust pursuan to relevant U.S. Treasury regulations; 2. The sponsoring entity is a Financial Institution, Reporting Reporting U.S. Model 1 FF, or FF, it is authorized Participating Act on behalf of the Financial Institution (such as a professional manager, trustee, or managing partner), and agree to perform, on behalf of the Financial Institution, all due diligence, withholding, reporting, and other requirements that the Financial Institution would have been required to perform if it were a Latvian Financial Institutions Reporting; 3. The Financial Institution does not hold itself out as an investment vehicle for unrelated parties; 4. Twenty or fewer individual will own all of the debt and Equity interests interests in the Financial Institutions (disregarding the debt owned by Participating interests and deemed compliant by the FFA-FFA States and Equity interests owned by an Entity if you own 100 percent of the Entity of the Equity interests in the Financial Institutions and is itself a sponsored Financial Institutions described in this paragraph (C)); and 5. The sponsoring entity to compl with the following requirements: (a) the sponsoring entity has registered) as a sponsoring entity with the is on the IRS website; the FATC registration (b) the sponsoring entity) agree to perform, on behalf of the Financial Institution, all due diligence, withholding, reporting, and other requirements that the Financial Institution would have been required to perform if it were a Financial Institution and retain a Reporting Latvian documentation collected with respect to the Financial Institution for a period of six years; (c) the sponsoring entity to identify) the Financial Institutions in all reporting completed on the Financial Institution's behalf '; and (d)) the sponsoring entity has not had its status revoked as a sponsor. D. investment advisors and investment managers. An investment Entity established in Latvia that is a Financial Institution solely because it (1) render investment advice, and it acts on behalf of, or (2) manage the portfolio for, and on behalf of ACTA, a customer for the purpose of investing, managing, or administering funds deposited in the name of the customer with a Financial Institution other than a Financial Institution Nonparticipating. E. Collective Investment Vehicle. An investment Entity established in Latvia that is regulated as a collective investment vehicle, provided that all of the interests in the collective investment vehicle (including debt interests in excess of $50.000) are held by or through one or more of the beneficial owner, the main active described in subparagraph (B) of the NFF (4) of section VI of Annex I, the Person that the U.S. not Specified U.S. persons , or Financial institutions that are not Financial institutions Nonparticipating. F. Special Rules. The following rules apply to an investment Entity: 1. With respect to their interests in an investment Entity that is (a) a collective investment vehicle described in paragraph (E) of this section, the reporting obligation of any investment Entity (other than a Financial Institution through which interests in the collective investment vehicle held by the Office) shall be deemed fulfilled. 2. With respect to interests in: (a) An investment Entity) established in a Partner Jurisdiction that is regulated as a collective investment vehicle, all of the interests in which (including debt interests in excess of $50.000) are held by or through one or more of the beneficial owner, the main active described in subparagraph (B) of the NFF (4) of section VI of Annex I, the Person that the U.S. not Specified U.S. persons , or Financial institutions that are not Financial institutions Nonparticipating; or (b) An investment Entity) that is a collective of qualified investment vehicle under the relevant U.S. Treasury regulations; the reporting obligation of any investment Entity that is (a) the Latvian Financial Institutions (other than a Financial Institution through which interests in the collective investment vehicle held by the Office) shall be deemed fulfilled. 3. With respect to their interests in an investment Entity established in Latvia that is not described in paragraph (E) or (F) in subparagraph (2) of this section, consistent with paragraph 3 of article 5 of the agreement, the reporting obligations of all other investment Entities with respect to their interests shall be deemed such fulfilled if the information required to be reported by the first-mentioned investment Entity pursuan to the agreement with respect to such interests is reported by such investment Entity or another person. V. accounts Excluded from Financial accounts. The following accounts are excluded from the definition of Financial accounts and therefore shall not be treated as a U.S. Reportabl accounts. A. Certain Savings Accounts. 1. Retirement and Pension accounts. A retirement or pension account maintained in Latvia that satisf to the following requirements under the law of Latvia. (a)), the account is subject to regulation as a personal retirement account or is on of a registered or regulated retirement or pension plan for the provision of retirement or pension benefits (including disability or death benefits); (b)) the account is tax-favored (i.e. any other., contributions to the account that would otherwise be subject to tax under the law of Latvia-deductibl or excluded from with the gross income of the account holder or taxed at a reduced rate, or taxation of investment income from the account is taxed at a reduced or deferred rate); (c) Annual information reporting is required) to the relevant authorities in the United Kingdom with respect to the account; (d) the conditioned on withdrawals) reaching a specified retirement age, disability, or death, or penalties apply to withdrawals made before such specified events; and (e)) Annual contributions to $50.000 with limited or less, applying the rules set forth in Annex I for account aggregation and currency translation. 2. Non-Retirement Savings Accounts. An account maintained in a Corporation (other than an insurance or Annuity contract) that the following requirements to satisf under the law of Latvia. (a)), the account is subject to regulation as a savings vehicle for the purpose other than for retirement; (b)) the account is tax-favored (i.e. any other., contributions to the account that would otherwise be subject to tax under the law of Latvia-deductibl or excluded from with the gross income of the account holder or taxed at a reduced rate, or taxation of investment income from the account is taxed at a reduced or deferred rate); (c) withdrawals are conditioned on) meeting specific criteria related to the purpose of the savings account (for example, the provision of educational or medical benefits), or penalties apply to withdrawals made before such criteria are met; and (d)) Annual contributions to $50.000 with limited or less, applying the rules set forth in Annex I for account aggregation and currency translation. (B) Certain Term Life Insurance Contracts. A life insurance contract maintained in Latvia with a coverage period that will end before the insured individual to attain age 90, provided that the contract to satisf the following requirements: 1. a Periodic premium, which do not decrease over time, are payable at least annually during the period of the contract is in existenc or until the insured will attain age 90, whichever is shorter; 2. The contract has a value of contract that any person can access (by withdrawals, loan, or otherwise) without terminating the contract; 3. The amount (other than a death benefit) payable upon cancellation or termination of the contract cannot aggregate of 12 the premium paid for the contract, less the sum of morbidity, mortality, and expense charges (whethers or not actually imposed) for the period or the period of the contract and any non ' s existenc paid prior to the cancellation or termination of the contract; and 4. The contract is not held by a transfere for value. C. Certain Other Life Insurance Contracts. A lifetime pension contract maintained in Latvia under the Law on State Funded Pension (State funded pensions Act). D. account Held By an estate. An account maintained in Latvia that is held solely by an estate if the documentation for such account includes (a) a copy of the deceased's will or death certificate '. E. Escrow Accounts. An account maintained in Latvia in connection with "any of the following: 1. (A) A court order or judgement. 2. (A) the sale, Exchange, or lease of real or personal property, provided that the account in the following satisf requirements: a) the account is funded solely with a down payment, money, deposit earnes in an amount appropriate to secure an obligation directly related to the transaction, or a similar payment, or is funded with a financial asset that is deposited in the account in connection with the sale , Exchange, or lease of the property; (b)) the account is established and used solely to secure the obligation of the purchaser to pay the purchase price for the property, the seller pays it any contingen liability, or the lessor or lesse to pay for any damage relating to the leased the property as agreed under the lease; (c)) the assets of the account, including the income earned thereon, will be paid or otherwise distributed for the benefit of the purchaser, the seller, lessor, or lesse (including such person's obligation to satisfy ') when the property is sold, exchanged, or surrendered, or terminate the lease; (d)) the account is not a margin or similar account established in connection with a sale or exchange of a financial asset; and (e)) the account is not associated with a credit card account. 3. An obligation of a Financial Institution servicing a loan secured by real property to set aside a portions of a payment solely to facilitat the payment of taxes or insurance related to the real property at a later time. 4. An obligation of a Financial Institution solely to facilitat the payment of taxes at a later time. F. Jurisdiction Partner Accounts. An account maintained in the United States and excluded from the definition of the Financial account under an agreement between the United States and another Partner in their Jurisdiction the implementation of FATC facilitat, provided that such account is subject to the same requirements and oversigh under the law of such other Jurisdiction as if such account Partners were established in that Jurisdiction and maintained by Partner (a) Partner in the Financial Institutions you Partner Jurisdiction Jurisdiction. Vi. Definition. The following definition shall apply to the additional the descriptions above: a. the Reporting Model 1 FF. The term Reporting 1 FF to mean a Model Financial Institution with respect to which a non-U.S. Government or agency thereof agree to obtain and exchange information to a Model 1 pursuan IGA, others than a Financial Institutions Financial Institutions treated as a Nonparticipating under the Model 1 IG. For the purpose of this definition, the term Model 1 means an IGA through to the United States or between the Treasury Department and a non-U.S. Government or one or more agencies thereof it implementations that reporting by Financial Institutions through FATC it such non-U.S. Government or agency thereof, followed by automatic exchange of such reported information with the IRS. B. Participating In FF. The term means a Participating Financial Institution in FF that has agreed to comply with the requirements of an FFI agreement, including (a) Financial Institutions described in a Model 2 IG that has agreed to comply with the requirements of an FFI agreement. The term Participating FFI also includes a qualified intermediary branch of a U.S. Financial Institution, unless the Reporting such branch is a Reporting Model 1 FF. For the purpose of this definition, the term of the agreement means an FFI agreement that sets forth the requirements for a Financial Institution to be treated as complying with the requirements of section 1471 (b) of the U.S. Internal Revenue Code. In addition, for the purpose of this definition, the term Model 2 IGA means through the United Nations to the United States or between the Treasury Department and a non-U.S. Government or one or more agencies thereof to facilitat the implementation of reporting by Financial Institutions of the FATC through directly to the IRS in accordanc with the requirements of an FFI agreement, supplemented by the exchange of information between such non-U.S. Government or agency thereof and the IRS.
For the Government OF the REPUBLIC OF Latvia: Andris Wolf FOR the Government OF the UNITED STATES OF America: memorandum OF UNDERSTANDING Pekal Mark REGARDING the agreement BETWEEN the Government OF the REPUBLIC OF Latvia AND the Government OF the UNITED STATES OF America TO improve INTERNATIONAL TAX compliance AND IT implementations At the signing today of the FATC of the Agreement Between the Government of Latvia and the Government of the United States of America to improve International Tax compliance and It implementations that FATC (hereinafter the "agreement"), the representatives of the United States of America and the United Kingdom wish to confirm their understanding of the following: In reference to paragraph 1 of article 1 (Definition) of the agreement, it is understood that, in the case of securities registered in a Central Securities Depository Latvian (Latvian Central Depositary) as defined in part E of the Latvian securities market Law (financial instruments market law) that are held by or through one or more other Financial institutions that are not Financial institutions, the Nonparticipating relevant Financial accounts would be treated as held by such other Financial institutions, and such other Financial institutions would be responsible for any reporting required with respect to such Financial accounts. It is understood that the Central Securities Depository on behalf of such a may report other Financial institutions in accordanc with paragraph 3 of article 5 of the agreement. In reference to Section V of Annex II (Excluded from Financial accounts accounts), it is understood that accounts held by entities that are considered funds that qualify as beneficial owner under the main Section (II) of Annex II are excluded from the definition of Financial accounts and is therefore not treated as U.S. Reportabl accounts. Signed at Riga, in duplicate, in the English language, this 27th day of June, 2014.
For the Government OF the REPUBLIC OF Latvia: Andris Wolf FOR the Government OF the UNITED STATES OF America: Mark Pekal informal translation of the Government of the Republic of LATVIA and the Government of the United States of America agreement on international TAX duties and the LAW on foreign account TAX obligations (FATC) introduction pursuant to the Government of the Republic of Latvia and the Government of the United States of America (hereinafter called "each Contracting Party" and "the Contracting Parties") wish to enter into a contract to improve international tax compliance with mutual assistance in tax matters, based on efficient automatic information exchange infrastructure; Noting that in accordance with the provisions of the Convention, concluded between the Government of the Republic of Latvia and the Government of the United States of America for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income (hereinafter referred to as "the Convention"), signed in Washington on 15 January 1998, article 27 allows for the exchange of information for tax purposes, including automatic; Noting that the United States regulations are in force, known as the law on foreign account tax obligations (Foreign account Tax Compliance Act, hereinafter referred to as "FATC law"), which is introduced to the reporting regime for financial institutions in relation to certain accounts; Noting that the Government of the Republic of Latvia support the FATC law underlying policy objectives, which is to improve the tax conformity; Noting that the law should address FATC several problems, such as the fact that in the Republic of Latvia on legal barriers to the Latvian financial institutions may not be able to ensure compliance with certain aspects of the law of FATC; Noting that the United States Government collects information about specific accounts that U.S. financial institutions hold Latvian residents, and it is determined to make this exchange of information with the Government of the Republic of Latvia and to provide such information at the appropriate level, provided that adequate safeguards and effective infrastructure for Exchange; Considering that the Contracting Parties are committed to work together in the long term, to achieve common standards for financial institutions reporting and customer research; Noting that the United States Government is aware that the Latvian financial institutions, the obligation to provide reports to be coordinated between the FATC Act and other us laws on tax reporting, to prevent duplication of reporting; Noting that, by providing access to the law for the implementation of the FATC intergovernmental level, will deal with the issue of legal obstacles and reduce the burden on financial institutions of Latvia; Considering that the contracting parties desire to contract to improve international tax compliance and ensure the FATC law implementation based on domestic mutual reporting and automatic exchange of information under the Convention and in the light of the confidentiality provided for in this Treaty and other protection rules, including rules that limit the use of the information provided by the other Contracting Party in accordance with the Convention; the Contracting Parties agree as follows: 1. Definitions for the purposes of this Treaty and its annexes (the "agreement") has these terms and their explanations: a) "United States" means the United States, including the US State, but not U.S. territory. Any reference to the United States "State" refers to the District of Columbia (district of Columbia); (b)) "U.S. territory" is American Samoa, Commonwealth of the Northern Mariana Islands, Guam, the Commonwealth of Puerto Rico or the U.S. Virgin Islands; (c)) "IIDA" is the U.S. Internal Revenue Service (U.S. Internal Revenue Service, or IRS); (d)) is the Republic of Latvia "Latvia"; e) "partner country" shall mean any country (jurisdiction), which actually has an agreement with the United States to promote the implementation of the law on FATC. IID public list of all partner countries; f) "competent authority" means: 1) in the United States – United States Secretary of the Treasury or the Secretary's delegated representative; 2) in Latvia – the Ministry of finance or its authorised representative; g) "financial institution" is turētājiestād, the deposit institution, investment firm or a specified insurance company; (h) "turētājiestād") is a company that holds financial assets in another person, and such activities represent a significant part of its business. The company holds financial assets in favour of another person, and such activities represent a significant part of its business, if such a gross income of the company in connection with the holding of financial assets and the financial services is 20 percent or more from its gross income in one of the following periods: (i)) the three-year period ending on 31 December (or the last day of the accounting period which is not a calendar year) before the that determination, or (ii)), a period in which the company exists, whichever of the following periods is shorter; I) "deposit" is a company that accepts deposits, subject to normal banking or similar business; j) "investment firm" shall mean an undertaking whose business (or the management company business) is to take one or more of the following activities or operations are on behalf of the client order or: 1) trade in money market instruments (cheques, bills, certificates of deposit, derivative financial instruments, etc.), currency exchange, trade in currency, interest rate and index instruments transferable securities or standardised futures contracts of goods; 2) solo and collective portfolio management; 3) other cash or money-management, administration, or on behalf of another person. This subparagraph shall be construed according to the definition of "financial institution" is defined in the financial action task force on money laundering (FATF, the Financial Action Task Force, or) recommendations; k) "insurance company" is a company that is the insurance company (or the insurance holding company) and issued accumulating life insurance contracts that provide for accumulated capital and life insurance payment or annuity contracts, which provide for the regular payment of benefits, or who are obliged to make payments in respect of such contracts; l) "financial institution" means (i)) every financial institution that is incorporated (registered) under the laws of Latvia, with the exception of the following financial institution branch (chapters) which is outside Latvia, and (ii) any such) financial institution branch (Division), which is not incorporated (registered) according to Latvian law, if such a branch (Division) is located in Latvia; m) "the partner financial institution" means (i)) every financial institution that is incorporated (registered) partner countries, with the exception of the following financial institution branch (Department), and (ii) the outside partner) every financial institution branch (Division), which is not incorporated (registered) partner countries, if such a branch (Division) is located in the partner country; n) "financial institution, which provides reports" depending on the context is either Latvian or a U.S. financial institution, which provide the messages; o) "financial institution, which provide the messages" is the Latvian financial institution that is not a financial institution of Latvia, which did not provide reports; p) "U.S. financial institution, which provides reports" have i) every financial institution that is a resident of the United States, with the exception of the following financial institution branch (Department) outside the United States, and (ii) such) every financial institution branch (Division), which is not a resident of the United States, where such a branch (Division) is located in the United States, where the financial institution or branch (Department) controls, receive or hold any income in relation to which it is necessary to exchange information under article 2 of this agreement, paragraph 2 (b)); q) "financial institution that does not provide reports" are any Latvian financial institution or other company which is a resident of Latvia, and either is described in annex II, as a financial institution that does not provide reports or otherwise conform to the authorities which, according to the United States Treasury regulations is considered to be the appropriate foreign financial institution (hereinafter referred to as the ĀF), with no need to switch to contract with IID ĀF from the FATC statutory withholding released the actual beneficiary or ĀF, which are not included in the definition of a foreign financial institution; r) "foreign financial institution, which is not a member of ' is a foreign financial institution, which is not a member, as defined in the respective States Treasury regulations; This term does not apply to Latvia or other partner financial institution that is not a financial institution, in accordance with article 5, paragraph 2 (b)) or the corresponding provisions in another agreement between the United States and the partner country as a foreign financial institution, which is not a Member; s) "financial account" means an account with a financial institution, which shall include: 1) a company that is a financial institution only because it is an investment company – financial institutions equity or debt securities (other than transferable securities, which are regularly traded stable stock market); 2) a financial institution which is not defined in part 1 of this paragraph, the financial institutions equity or debt securities (other than transferable securities, which are regularly traded stable stock market) if i) shows or equity value is determined, directly or indirectly, mainly taking into account the assets forfeited payments based on originating in the United States, and ii) securities category was set to avoid reporting under this contract; 3) every financial institution issued or maintained in accumulating life insurance and annuity contract that is not a contract relating to the carrying out of the investment and is not transferable to immediate life insurance annuity contract issued by an individual and provides for a pension or invalidity allowance remuneration paid, which is carried out in accordance with the terms of this account, for which it is established that it is excluded from the in annex II definitions of the financial account. Notwithstanding the foregoing, the term "financial account" does not apply to accounts that are excluded from annex II financial account set out in the definition. Interest in this agreement are "regularly admitted" for a permanent interest is a significant trading volume and "created stock market" means a stock exchange that is officially recognized and the national authorities monitor, in which the market and that of a significant annual value of the shares are traded on the stock exchange. 1. point's) interest in the financial institution is not "regularly admitted", and should be considered as a financial account if the interest holder (other than a financial institution, which acts as an intermediary) is registered, such financial institutions. The previous sentence shall not apply to the interest that first registered the following financial institutions records before July 1, 2014, and for the interest that first registered the following financial institutions recorded 1 July 2014 and later, the financial institution is not required to apply the previous sentence before January 1, 2016. t) "deposit account" includes any komerckont, current account, savings account, term account or credit consortia (pensions) account, or an account evidenced by a certificate of deposit, investment certificate of cooperative credit certificate, display a certificate or other similar instrument, which is maintained by a financial institution, performing normal operations of the bank or a similar business. Deposit account also includes the amount held by an insurance company under the guarantee agreement or similar investment contributions or contracts including interest in such account; u) "holder's account" is an account (which is not a contract of insurance or annuity contract) for the good of the other person, which is the investment for the financial instrument or contract holder (including not only, but also of the company's shares, bills of Exchange, promissory note, bond or other debt security, currency or commodity transactions, credit swaps, swaps, based on non-financial index of notional principal contract, insurance contract or annuity contract , option or other derivative instrument holder); v) "equity" means ownership interest, such as the capital or profits of a partnership that is a financial institution. In relation to a trust that is a financial institution, believes that equity there person, regarded as the founder or the beneficiaries of a trust in relation to the whole or any part of it, or other individual who implemented the final actual control over the trust. Specify a u.s. person is considered as the beneficiary in relation to foreign trusts, if a designated the U.S. has the right to directly or indirectly (e.g., through an appointed representative) to receive compulsory profit-sharing parts or which directly or indirectly can be obtained at the discretion of the trust made a profit distribution part of the trust; w) "insurance contract" means a contract (other than an annuity contract) under which the contract issuer agrees to pay a certain amount, if the implementation of the specified probability that is associated with death, sickness, accident, liability and property risks; x) "annuity contract" (accumulative life insurance contract, which includes regular benefits) is a contract under which the Authority agrees to make payments in a given period, which is determined, in whole or in part, taking into account one or more of the individuals life expectancy. This term also applies to the agreement, regarded as the annuity contract, under its national law (jurisdiction) regulations or practices in which the contract was issued, and according to the contract authority agrees to make payments within a certain period of several years; y) "accumulating life insurance" (which includes the capital and accumulated in life insurance premiums cost) is an insurance contract (other than reinsurance contract for consideration between the two insurance companies), money value exceeds 50 000 USD; z) "cash value" means the greater of the following amounts: i) the amount that a policyholder is entitled to receive, after termination of the agreement or the end of the term (without deducting charges for the termination of the contract or loan under the policy), or (ii)) the amount the policy holder may borrow under or in connection with the provisions of the Treaty. Notwithstanding the foregoing, the term "cash value" does not apply to the amount payable under the contract of insurance; 1) as a reward to the person injury or illness or other remuneration, which compensates for the economic loss incurred due to an accident; 2) as repayment of money the policy holder for the premiums previously paid under contracts of insurance (non-life insurance) in connection with the cancellation of the policy, the reduction of risk positions in the insurance contract or in cases where bonuses are set record again fixes or other similar error; 3) as dividend policy holder, based on the experience of signing, which is linked to the contract in question or the group involved; AA) "account, which must give the message" depending on the context it is us or the Latvian account for which you want to report; BB) "account, which must submit a report for Latvia" is a financial account of u.s. financial institution, providing messages, if: (i)), the holder of the deposit account is an individual who is a resident of Latvia, and each calendar year of more than $10 is paid as a percentage in this account, or (ii)) financial account, other than a deposit account holder is a resident of Latvia, including companies that certify that they are Latvian resident for tax purposes and in this account are paid or credited to the income originating in the United States and covered the US Internal Revenue Code subsection A of section 3 or subsection 61. section F, the obligation to report; CC) "account, which must submit a report to the U.S." is a financial account with a financial institution in Latvia, providing messages, and such account holder either has one or more specified persons in the US, or a company that is not a u.s. company, and it is controlled by one or more persons that are specified in the UNITED STATES. Notwithstanding the foregoing, account shall not be deemed an account for which you want to give a message to the U.S., where the application of the procedure laid down in annex I in connection with customer research, is certain that the account is the account for which you want to report US; DD) "account holder" means the person whom the financial institution where the account is situated, included financial account holder or designated as financial account holder. A person who is not a financial institution, keeping the financial accounts of the other person as agent, holder, nominants, signer, investment consultant or broker in this Agreement shall be considered as the account holder, and the second person is considered to be the account holder. For the purposes of the previous sentence, the term "financial institution" does not include a financial institution established or incorporated u.s. territory. In connection with the accumulating life insurance or annuity contract account holder is anyone who has access to the cash value or change the beneficiary specified in the contract. If there is no person who can access the cash value or change the beneficiary, the account holder shall mean any person specified in the contract as the owner and any person entrusted with the right to receive payment in accordance with the provisions of the Treaty. Accumulating life insurance or annuity contract at the end of the period of account holder is considered to be any person who is entitled to receive payment in accordance with the Treaty; EE) "U.S. person" means an individual who is a national or resident of the UNITED STATES, a limited partnership or a company established in the United States or the United States or any State law, a trust if (i)) in accordance with the applicable laws of the United States courts have powers to issue orders or judgments about basically all matters affecting the administration of the trust, and (ii)) by one or more UNITED STATES persons are authorized to control all the relevant trust decisions If the deceased person's property, which is a United States citizen or resident. This paragraph shall be interpreted in accordance with the U.S. Internal Revenue Code; FF) "indicates the U.S. person" means a person who is not the USA i) company whose shares are regularly traded on one or more stable securities markets, ii) company, which is the same extended affiliates team member under the U.S. Internal Revenue Code 1471 e) paragraph of article 2), and (i) of this paragraph), the company referred to in subparagraph (iii)) or any of the United States wholly owned agency or agency of such a tool , iv) every State in the United States, any u.s. territory, any political subdivision of that territory or the territory of any of the above wholly owned agency or agency of such instruments, g) every organization that is exempt from taxation under the U.S. internal revenue code 501 (a) of article), or individual pension plan under that code 7701 (a)) of article 37, point vi) every point by the bank under the U.S. Internal Revenue Code 581. Article , VII) everyone in the real estate investment trust under the UNITED STATES internal revenue code 856. Article VIII) any regulated investment company under the UNITED STATES Internal Revenue Code 851. Article, or any company that is registered with the U.S. Securities Commission (Securities Exchange Commission) under the 1940 investment company Act (15 U.S.C. 80A -64), ix) any common investment fund under the U.S. Internal Revenue Code, art. 584) a point x) any trust that is exempt from taxation under the U.S. Internal Revenue Code, art. 664 c) point or set in the code of conduct referred to in article a) 4947 a 1 point), xi) dealer that carries out transactions in securities, commodities or financial derivatives (including notional principal contracts, futures contracts, forward contracts and options contracts) and is duly registered under the United States or the laws of the State, or XII) the broker under the U.S. Internal Revenue Code 6045 c) article; or (XIII)) any of the taxes exempted trust under the UNITED STATES internal revenue code 403 (b) or 457). (b)). Gg) "undertaking" means a legal person, or any legal foundation, for example, a trust; HH) "a company that is not a u.s. company" is a company that is not a u.s. person; II) "payment is forfeited, originating in the United States" is the interest payment (including the original emission haircut), dividends, rent, salary, wages, bonuses, annuity (annuity), compensation, remuneration, salary and other fixed or determinable annual or periodic gains, profits and income, if such payments originating in the United States. Notwithstanding the above, the payment is forfeited, originating in the United States, does not apply to payments that the relevant States Treasury regulations do not consider such a payment; JJ) company is an "associated company", if one of the companies controlled by the company or the other two companies are jointly controlled. For this purpose, the control is direct or indirect ownership of more than 50 percent of the voting rights or values. Notwithstanding the foregoing, Latvia may believe that the company has no other associated company of the company, if the two companies do not have the same extended group of related company under the UNITED STATES internal revenue code 1471 e) paragraph of article 2); KK) "U.S. NMN" is the U.S. federal taxpayer identification number; LL) "NMN" is a taxpayer identification number (natural person, personal identification number or tax payer registration code); mm) "persons who exercise control" means natural persons exercising control over the company. In relation to trusts this term refers to the founders, Trustees, champion (if any), beneficiaries or beneficiary class, and any physical person who exercised actual control over the final trust; in connection with the legal foundation which is not a trust, this term refers to persons equivalent or similar items. The term "persons who exercise control" shall be understood in accordance with the financial action task force to combat money laundering (Financial Action Task Force, or FATF) recommendations. 2. If not otherwise required for the purposes of the agreement or the competent authorities do not agree on a common meaning (which is allowed by national legislation), any term not defined in this agreement, is used in the sense in which it is used at a given time of the Contracting Party whose legislation the contract applies, and in a sense, the term is applied to the Contracting Parties under current tax law, prevails in comparison with the importance in which the term is used in other relevant legislation of the Contracting Party. 2. the Obligation to obtain information and exchange information relating to the accounts for which report 1. In accordance with the article 3 of the Treaty, each Contracting Party obtained in paragraph 2 of this article that information on all accounts, for which you want to report, and annually make automatic exchange of relevant information with the other Contracting Party pursuant to article 27 of the Convention. 2. the contracting parties collect and exchange the following information: (a) in the case of Latvia) for each account for which you want to give a message to the US that is a financial institution, which provides reports: 1) for each of the specified U.S. person who is the holder of such account, the required information is name, address, and NMN, and if, after laid down in annex I, the client survey procedure, a company that is not a u.s. company , is identified as such, over which control is exercised by one or more persons who are U.S. persons, required information is such a company name, address, and NMN (if any) and in the UNITED STATES each person's name, address and NMN (if any); 2) account number (or its functional equivalent, if there is no account number); 3) Latvian financial institutions that provide reports, name and identification number; 4) account balance or value (including the cash value or replacement value of about accumulating life insurance or annuity contracts) in the calendar year concerned or other eligible at the end of the reporting period, or if the account is closed this time of year, right before you close your account; 5) on account holder will require the following information: A) the total gross amount of the interest, the total gross amount of dividends, other income total gross amount arising in connection with the assets held in the account, which in each case paid or credited to the account (or is associated with the account) in the calendar year or other relevant reporting period; (B)), the total gross revenue from the sale or the recovery of the property, and paid or credited to the account in a calendar year, or other appropriate during the reporting period, and in relation to the following account with a financial institution in Latvia, providing messages, acted as a holder, broker, designated representative, or as otherwise stated in the capacity as agent of the account holder; 6) on deposit account information required is the total gross amount of interest paid or credited to an account in a calendar year, or other appropriate during the reporting period; 7) on the account, which are not defined in paragraph 2 of this article 5) or 6), the information required is the total gross amount paid or credited to the account holder about the account, including the total amount repaid by the account holder, calendar or other eligible during the reporting period, and in relation to the following account with a financial institution in Latvia, providing messages, is the bottler or debtor; (b)) in the case of the United States for every Latvian account for which you want to report on every U.S. financial institution, which provides reports: 1) for each person who is a resident of Latvia and the account holder, the required information is name, Latvian NMN.; 2) account number (or its functional equivalent, if there is no account number); 3) u.s. financial institutions that provide reports, name and identification number; 4) deposit account interest paid in gross amount; 5) dividend, which originated in the United States, the gross amount paid or credited to an account; 6) income originating in the United States, the gross amount paid or credited to account if it is subject to the U.S. Internal Revenue Code subsection A of section 3 or subsection (F) section 61. specific reporting. 3. the exchange of Information and a way to meet the 1 in article 2 of the Treaty obligations to exchange information, the payment amount and the characteristics associated with account for which you want to report US, can be determined according to the Latvian tax law principles, and the payment amount and the characteristics associated with account for which you want to report Latvia, you can determine under U.S. federal income tax law principles. 2. To comply with article 2 of this Treaty the obligations to exchange information, in the course of the exchange of information are set out in the currency in which it is expressed in each of the corresponding amount. 3. in the light of article 2 of this agreement, obtain and exchange information about 2014 and the subsequent years, subject to the following exception: a) in the case of Latvia: 1) for 2014 is obtained and exchanged only with the information referred to in article 2 of this agreement, paragraph 2 (a))) (1-4)); 2) for 2015 is obtained and exchanged only with the information referred to in article 2 of this agreement, paragraph 2 (a)) 1)) (-7), except for information on gross revenue referred to in article 2 of this agreement, paragraph 2 (a))) (5) (B)); 3) for 2016 and subsequent years to obtain and communicate only with the information referred to in article 2 of this agreement, paragraph 2 (a)) 1)) (-7); (b) in the case of the United States) for 2014 and the following years obtain and exchange all of this Treaty article 2, paragraph 2 (b)) the information specified in point. 4. in the light of paragraph 3 of this article, for each account for which you want to report, and operated by a financial institution, which provides reports to 30 June 2014, and in the light of article 6 of this agreement, paragraph 4, the contracting parties do not have to obtain and exchange of information should not be included in the Latvian NMN or USA that are suitable, NMN if such taxpayer identification number is the financial institutions accounting providing reports. In this case, the parties collect and include exchange of information date of birth of the person concerned, if any financial institutions that provide reports, registers. 5. in the light of the 3 and 4 of this article, with this contract referred to in article 2 information exchange is carried out within nine months after the end of the calendar year to which the information relates. 6. Latvia and the United States, the competent authorities conclude a contract or arrangement under the Convention provided for in article 26 mutual agreement for the procedure, according to which: (a)) is determined this Treaty procedure referred to in article 2 obligation to fulfil in connection with the automatic exchange of information; (b)) is definitely the article 5 of the Treaty requires the implementation of rules and procedures; (c)) is created the necessary procedures for the exchange of information, for which a report is provided pursuant to article 4 of this agreement, paragraph 1 (b)). 7. all exchanges of the information contained in the relevant provisions contained in the Convention on the protection of privacy and other, including rules that limit the exchange of information received. 8. After the entry into force of this Treaty, each competent authority shall provide written notification to the other competent authority, if it is satisfied that the other competent authorities have jurisdiction i) appropriate security measures to ensure that the information received in accordance with this agreement, shall be considered confidential and will be used solely for tax purposes, and is the effective infrastructure ii) exchange of information (as well as the process has been established to ensure timely, accurate and confidential exchange of information, efficient and secure communication, and demonstrate the ability to quickly resolve issues and concerns regarding the Exchange or Exchange requests and administer this agreement, the provisions of article 5). The competent authorities shall seek in good faith to meet before September 2015 to determine that each jurisdiction has the following guarantees and infrastructure. 9. Obligations of parties to obtain and exchange information, in accordance with article 2 of this Treaty, shall enter into force on the date of receipt of the last written notification from that described in paragraph 8 of this article. Notwithstanding the foregoing, if the competent authority of Latvia is convinced that the United States is the appropriate security measures and infrastructure described in paragraph 8 of this article, but in addition it takes time for the U.S. competent authority found that Latvia has the following security measures and infrastructure, the obligation to obtain and exchange information, in accordance with article 2 of this Treaty shall enter into force on the date on which the written notice provided by the competent authority of the UNITED STATES from Latvia to the competent authority, in accordance with paragraph 8 of this article. 10. this Agreement shall cease to have effect on 30 September 2015, if by that date not in force article 2 of this Treaty with respect to any party in accordance with paragraph 9 of this article. 4. application of the law of PANTSFATC of the Latvian financial institutions 1. Latvian financial institutions that report to the applicable mode. Believes that each financial institution in Latvia, providing reports, ensure compliance with U.S. internal revenue code in article 1471 to withholding, but laid down withholding does not apply to the authority if the execution of the present agreement, Latvia 2., and 3. the obligation laid down in article related to Latvian financial institution, providing messages, and Latvia's financial institution, which provides reports: a) identifies the accounts that report in the United States, and shall report annually to the competent authority of Latvia by specifying the required information according to article 2 of the present agreement, paragraph 2 (a)) and in the form specified in article 3 of this agreement; (b)) shall report annually to the competent authority of Latvia for the 2015 and 2016, indicating for each the name of a foreign financial institution, which is not a member of, to which it made the payments, and the total amount of such payments; c) ensure compliance with applicable registration requirements, the registration of the IID FATC site.; d) if the financial institution of Latvia, providing messages, i) works as a qualified intermediary (the US internal revenue code for the purpose of article 1441), choosing to assume primary withholding responsibility under the U.S. Internal Revenue Code subsection A of section 3, the foreign limited partnership ii) is chosen to be that of a foreign limited partnership, which made levy (U.S. Internal Revenue Code and article 1441.1471), or (iii)) is a foreign trust that is chosen to be a foreign trust that make withholding (U.S. Internal Revenue Code and article 1441.1471), withheld 30 percent in relation to withholding payments, originating in the USA, which made everyone a foreign financial institution, which is not a Member; e) if financial institutions of Latvia, providing messages, not mentioned in this article), and it makes the payment or acts as an intermediary for payment forfeited originating in the U.S., and if payment is made by a foreign financial institution, which is not a member of the Latvia's financial institution, which provides reports direct to provide anyone a withholding payment operator originating in the United States, the information required and the withholding of funds for the purpose of reporting and is linked to the following payment. Apart from the above, if the financial institution of Latvia, providing messages, do not meet the conditions referred to in this paragraph, is not covered by the US Internal Revenue Code 1471. Article, withholding, unless such financial institution in Latvia, providing messages, IIDA is not identified as a foreign financial institution, which is not a member, as defined in article 5 of the present agreement, paragraph 2 (b)). 2. the suspension of accounts, which provide no information. The United States does not require financial institutions of Latvia, providing messages, withholding tax in accordance with the U.S. Internal Revenue Code-1471 or 1472. in connection with article account holder does not provide the required information (as defined by the UNITED STATES internal revenue code 1471. article d) point 6)), or switch to such account, if such account the U.S. competent authority receives this Treaty article 2, paragraph 2 (a)) the information prescribed in paragraph subject to article 3 of this agreement. 3. the special arrangements for pension plans. The U.S. Internal Revenue Code 1471 and 1472. the purpose of article States considers that Latvia listed in annex II to the pension plan are either considered appropriate that ĀF should not conclude a contract with the ĀF IID, or from the FATC statutory withholding released the true beneficiary. For this purpose, the Latvian pension plan means either the company that created or located in Latvia and governed by the laws of Latvia, or a predetermined contractual or legal foundation, which is to provide pension or retirement benefits or generating revenue for the provision of such benefits under the legislation of the Republic of Latvia, and its operation is regulated in relation to contributions, profit distribution, reporting, sponsorship and taxation. 4. Other eligible to be considered a ĀF, which is not close to an agreement with IID ĀF, and from the statutory withholding FATC released the true beneficiaries and those applicable regime. The U.S. Internal Revenue Code 1471. for the purpose of article States consider that each financial institution in Latvia, which did not provide reports, are either considered appropriate that ĀF should not conclude a contract with the ĀF IID, or from the FATC statutory withholding released the true beneficiary. 5. Special provisions for the related companies, which do not have the ĀF, which is not a party. If the financial institution of Latvia, which otherwise comply with paragraph 1 of this article the requirements laid down in this article is mentioned, or 3 or 4, is a related company or branch (Division), operating in the jurisdiction which does not allow such related company or branch (Division) to perform the ĀF, which is a member of certain specific requirements, or for the appropriate ĀF for the which considered should not conclude a contract with the ĀF IID, the U.S. Internal Revenue Code 1471. the purpose of the article or it's associated company or subsidiary that is seen as a financial institution that is not a member of the expiry of the transitional restrictions and limited ĀF affiliates, us government regulation, this Latvian financial institutions continue to ensure compliance with the provisions of this Treaty, and it is considered appropriate to continue ĀF, which does not have to switch contracts with IID ĀF, or from the statutory withholding FATC released the true beneficiary as it corresponds to the US Internal Revenue Code 1471. for the purposes of article where: (a)) financial institution of Latvia considers that each such affiliate or branch (Division) is a separate ĀF that is not a party to this agreement, taking into account requirements for reporting and withholding of payments, and each such affiliate or branch (Division) itself indicates as ĀF, which is not a member, the authorities shall take the withholding of payments; b) each such affiliate or branch (Department) identify their U.S. accounts and provide reports on these accounts under the U.S. Internal Revenue Code article 1471, if it allows the relevant legislation that applies to the related company or Department (branch); (c)) the following related company or branch (Division) did not offer US accounts to hold persons who are not resident in the jurisdiction in which this related company or branch (Division), or accounts to hold foreign financial institutions that are not members and are not registered in the jurisdiction in which such branch (Division) or related company, and Latvian financial institution or another related company does not use such affiliate (Department) or related companies to bypass this contract or, respectively, the U.S. Internal Revenue Code section 1471 obligations. 6. time coordination. Notwithstanding article 3 of this agreement, and (5) 3: a) Latvia shall not have the obligation to receive and exchange information relating to the calendar year before the calendar year for which similar information is required, the ĀF report according to the IID u.s. State regulations; b) Latvia shall not have the obligation to start Exchange of information before the date by which the ĀF have reported similar information to the appropriate IID u.s. State regulations; (c) the UNITED STATES is not obliged to get), and exchange of information in respect of a calendar year, before the first of the calendar year in respect of which Latvia is obliged to obtain and exchange information, and (d) the UNITED STATES shall not be obliged to start) the exchange of information before the date by which Latvia is bound to start exchanging information. 7. United States Treasury Regulation definitions. Notwithstanding article 1 of this agreement and definitions, which are included in the annexes to this agreement, the implementation of this agreement, Latvia may use and may allow the Latvian financial institutions to use appropriate definition States Treasury regulējumo, which corresponds to the definition of this Treaty, provided that such application will not be able to break up this agreement. 5. PANTSSadarbīb-compliance and implementation 1. Minor and administrative errors. The competent authority shall inform the competent authority of the other party, if the first to that competent authority has reason to believe that any administrative or other small errors in the message, the information provided is incorrect or incomplete or otherwise violate this agreement. The other hand to the competent authority to apply local law (including applicable penalty) to get the correct and/or complete information or solve another breach of this contract. 2. Significant non-compliance with (a)), the competent authority shall inform the competent authority of the other Contracting Party, if the first competent authority found that in relation to the jurisdiction of another financial institution, providing messages, there are significant non-compliance with the obligations laid down in this agreement. Of the other Contracting Party, the competent authority shall apply its national law (including the existing fines) to address specified in the notice. (b)) If in connection with the financial institution of Latvia, providing messages, following compliance do not give results within 18 months after the first significant non-compliance notification, the United States believes that financial institutions of Latvia, providing messages, is a foreign financial institution, which is not a member, according to paragraph 2 (b)). 3. Reliance on service providers, which is third-person. Each Contracting Party may authorise financial institutions, providing messages, use the service providers are third parties to comply with the Contracting Parties and described in this agreement, defined responsibilities, even though such obligations comply with financial institutions that provide reports. 4. avoidance is excluded. The Contracting Parties shall implement the requirements necessary to prevent financial institutions adopt the practice, the purpose of which is to circumvent the requirements laid down in this agreement to provide reports. 6. the Mutual commitment to further promote the effective exchange of information and transparency 1. Mutual commitment. The United States Government was aware of the need to make two-sided automatic exchange of information with the equivalent level. The United States Government is committed to continue to improve transparency and to promote information exchange relations with Latvia, and by encouraging and supporting the relevant legislation in order to achieve appropriate reciprocal automatic exchange of information. 2. Treatment in connection with payments through intermediary bank and withholding payment on gross revenues. The Contracting Parties are committed to collaborate and together with partner countries to develop practical and effective alternative approach to the policy objectives, which include withholding in connection with payments through intermediary bank and withholding payment on gross revenues, reducing the burden. 3. common reporting and information exchange model under development. The Contracting Parties shall jointly with the partner countries, the Organisation for economic cooperation and development and the European Union pledged to work for this agreement and all other agreements between the United States and partner countries to adapt the common automated information exchange model, including elaborate reporting and customer survey standards for financial institutions. 4. Documents for accounts that exist on 30 June 2014. In connection with the account, for which the report and that is a financial institution that provides reports to 30 June 2014: a) States undertakes to 2017 January 1 to lay down rules for reporting about 2017. year and subsequent years, under which the U.S. provides financial institutions are required to obtain and provide to the account holder for every Latvian NMN Latvian account that report, according to article 2 of the present agreement, paragraph 2 (b))) (1); (b) Latvia undertakes to 2017) January 1 to lay down rules for reporting about 2017. year and subsequent years, under which financial institutions of Latvia, providing messages, you are required to get in the UNITED STATES each person of this contract 2 NMN article 2, point a (a)) 1). 7. PANTSASV to the consistent application of the law of FATC partner countries 1. the advantage in the form of more favourable provisions in accordance with article 4 of this agreement, or in connection with Annex 1 of the FATC law Latvian financial institutions than the rules that apply to other partner country according to the bilateral contract signed, under which the other partner undertakes to assume the same obligations as Latvia referred to this Treaty under article 2 and 3. under the same conditions as set out in these articles of the Treaty and article 5 – article 9. 2. States shall inform Latvia of more favourable provisions and apply the following favourable provisions automatically in accordance with this agreement as though they were set forth in this agreement and the entry into force on the date on which the contract is signed with the included more favourable terms, if one refuses to Latvia do not apply. 8. PANTSApspriešan and amendments 1. If difficulties arise in the implementation of this Treaty, each Contracting Party may request consultations in order to develop appropriate measures for the enforcement of the Treaty. 2. this agreement may be amended according to the writing of both Contracting Parties in the reciprocal agreement. Unless otherwise agreed, any amendment shall enter into force in the same order as defined in article 10 of this agreement 1. 9. The annexes annexes are an integral part of this agreement. 10. the term of This agreement PANTSLīgum 1 shall enter into force on the day of Latvia in writing notified the United States that Latvia has completed the necessary internal procedures to this Treaty to take effect. 2. Each Contracting Party may terminate the agreement by notifying the other party in writing. The contract is terminated on the first day of the month, the end of the 12-month period after the date on which the notice was given for the termination of the contract. 3. the Contracting Parties until 2016 December 31 in good faith discussing amendments to this agreement that are necessary to reflect the progress made in connection with article 6 of this Treaty the obligations. Confirming this, a person that is authorized by the Government under the signature of this agreement,. Signed in Riga, in duplicate, in the English language, 27 June 2014.
The Government of the Republic of LATVIA: Andris Vilks on behalf of the Government of the United States of America: Mark Pekal annex I the customer research to identify and provide reports on accounts, which Report to the U.S., and payments to certain foreign financial institutions that are NOT members of i. General provisions a. Latvia require that financial institutions of Latvia, providing messages, as specified in annex I, customer research procedures to identify the accounts for which the report and accounts in the United States, foreign financial institutions that are not members. B. this agreement 1) all amounts in dollars are expressed in u.s. dollars, and it should be understood that the equivalent in other currencies; 2) unless otherwise provided, the account balance or value determines the calendar year or other relevant report on the last day of the period; 3) If, in accordance with Annex I or the values of the threshold should be set at 30 June 2014, the balance or value shall be determined on the day or the last day of the reporting period that ends immediately before the 30 June 2014, and, if the balance in accordance with Annex I, or to determine the threshold value on the last day of a calendar year, or the residue value determines the calendar year or other relevant report on the last day of the period; 4) taking into account Annex I, section II, point 1), the account is considered to be an account, submit a report to the U.S., starting from the date on which it has identified as such according to the account specified in annex I, the client survey procedure; 5) unless otherwise specified, information about the account, on which the report of the United States, provided time during the calendar year that follows the year to which the information relates. C. an alternative approach in each section of this annex to the procedure laid down in is that Latvia may allow financial institutions of Latvia, providing messages, use the respective States Treasury procedures referred to in the provisions, to determine whether the account is the account that the report of the United States, or the account holder is a foreign financial institution, which is not a member. Latvia Latvia may allow financial institutions to make choices for each of section I of this annex or for all relevant financial statements or separately for any clearly identifiable this report (for example, with the line of business or the place where the account is maintained). II. Iepriekšpastāvējuš of private accounts. To determine whether the iepriekšpastāvējuš accounts which are individuals (hereinafter referred to as "the iepriekšpastāvējuš of private accounts"), are the account on which the report of the United States, applies the following rules and procedures. A. Account for which research is required, not be identified or is not required to provide reports. If the financial institution of Latvia, providing messages, do not choose to act otherwise in respect of all iepriekšpastāvējuš individuals accounts or separately for any clearly identifiable groups of such account and if Latvia existing implementing rules are for such choice is not required to conduct research, identify or provide reports on such accounts as iepriekšpastāvējuš individuals accounts that report US: 1) in the light of paragraph (E) of this section 2) for iepriekšpastāvējuš individuals account balance or value at 30 June 2014 will exceed 50 000 USD; 2) in the light of paragraph (E) of this section 2), the individual's iepriekšpastāvējuš account that is accumulating in the life insurance and annuity contract and which balance or value at 30 June 2014 is 250 000 USD or less; 3) iepriekšpastāvējuš individual's account that is accumulating in the life insurance or annuity contract, if Latvia and United States laws or regulations do not permit the sell actually accumulating life insurance or annuity contract U.S. residents, for example, if the financial institution has not been registered under the UNITED STATES legislation, and in accordance with Latvian law, insurance products, which are the Latvian residents, the reporting or withholding of payments; 4) on deposit account balance or value is 50 000 USD or less. B. research procedures in iepriekšpastāvējuš individuals accounts balance or value at 30 June 2014, exceeds 50 000 USD (250 000 USD accumulating life insurance or annuity contract), but not more than 1 000 000 USD ("the smaller value accounts") electronic record 1. The Latvian financial institutions, providing messages, examine the data in electronic form in the Latvian financial institutions, providing messages, looking for one of the following indications on the relationship with the UNITED STATES: a) the account holder as a u.s. national or resident identification; (b) a clear indication of) the UNITED STATES as a place of birth; (c)) the current mailing or residential address in the U.S. (including the mail box number of u.s. subscribers); d) current phone number in the USA; (e) a permanent order to transfer) the money to accounts in the United States; (f)) or the signature on the powers of the valid law, issued to a person with an address in the USA; g) address in the US, with which the account holder is bound, or the address where the account holder is sent addressed to the mailings, which is the only account holder address the Latvian financial institutions records, providing messages. If a private individual account is iepriekšpastāvēj smaller value account, consider that address with which it is affiliated, or an address to which you send it addressed to the mailings, outside the United States is not an indication of a relationship with the United States. 2. If the data in electronic form is not found no indication of association with the United States, referred to in point 1 (B) of this section), it is not necessary to take further action until a change occurs in an account which is associated with the account of one or more pointers on the relationship with the U.S. or the account according to article D of this section becomes a great value accounts. 3. If the data in electronic form which is found in paragraph (B) of this section 1) the indication referred to in connection with us or if there are changes in the circumstances, the results of which the account is associated with one or more pointers on the relationship with the U.S., Latvia's financial institution, which provides reports, considers that the account is the account for which you want to report US, unless it chooses to apply paragraph 4 (B) of this section) and one of the above exceptions do not apply to the following account. 4. Even if the indication is found on the relationship with the United States, as defined in point 1 (B) of this section), the Latvian financial institution, providing messages, are not obliged to believe that the account is the account for which you want to report US if: (a)) information on the account holder expressly indicates that it is the birth place of U.S. financial institutions of Latvia, providing messages, acquires or has been previously researched and maintained the following account holder: 1) pašapliecinājum that it is neither a national nor a resident of the U.S. for tax purposes (such information may appear in the IID W-8 form or other similar approved form); 2) passport, which is issued in the USA, or other Government issued identification document which confirms that the account holder is a national or citizen of a country other than the United States, and 3) a copy of the account holder's certificate of citizenship issued or reasonable explanation for it: a) what is the reason that the account holder does not have this certificate, even though it claims that the US "extraordinary rendition", or (b)) what is the reason at the time of the birth, that the account holder has acquired U.S. citizenship; (b) information on the account) if the holder is a message about the current mail address or residence of the United States, one or more phone numbers in the UNITED STATES, which are the only ones with account numbers, financial institutions, providing messages, acquires or has been previously researched and maintain the following records: 1) account holder pašapliecinājum that it is neither a national nor a resident of the U.S. for tax purposes (such information may appear in the IID W-8 form or other similar approved form) and 2) documentary evidence in accordance with point VI of annex I (D) that the account holder has no status in the US; (c) information on the account) if the holder is a permanent order to transfer funds to the account of the United States, Latvia's financial institution, which provides reports, obtains or has previously researched and maintain the following records: 1) account holder pašapliecinājum that it is neither a national nor a resident of the U.S. for tax purposes (such information may appear in the IID W-8 form or other similar approved form), and 2) documentary evidence in accordance with point VI of annex I, point (D) of the that the account holder has no status in the US; (d) if the information on the account) the holder of a valid power of attorney or the signature of the rights given to the person to whom the UNITED STATES has an address, the address to which the person is associated, or address to which you send such person addressed to the mailing address and this is the only account holder in a specific address, or one or more phone numbers in the US (if the phone number that is not a us number, also is linked to the account) Financial institution of Latvia, providing messages, acquires or has been previously researched and maintain the following records: 1) account holder pašapliecinājum that it is neither a national nor a resident of the U.S. for tax purposes (such information may appear in the IID W-8 form or other similar approved form), or 2) documentary evidence in accordance with point VI of annex I (D) that the account holder has no status in the US. C. additional procedures that are applied to the iepriekšpastāvējuš private accounts, which have lower value accounts 1. iepriekšpastāvējuš personal account research, which claims about the relationship with the US has lower value accounts, be completed by 30 June 2016. 2. Where a change in circumstances in connection with the individual's iepriekšpastāvējuš account, which is the lowest value of the account, and the account is associated with one or more pointers on the relationship with the United States, as indicated in paragraph 1 (B) of this section), the Latvian financial institutions, providing messages, consider that account is the account for which you want to report US if this section does not apply (B) point 4). 3. with the exception of point (A) of this section 4) referred to the deposit accounts, believes that anyone who iepriekšpastāvēj an account under this section shall be designated as the account for which you want to give a message to the United States, in the years ahead is the account for which you want to report US if the account holder is still shown in the United States. D. In-depth study procedures in iepriekšpastāvējuš individuals accounts balance or value in 2014 or 2015. May 30 year or any subsequent year 31 December exceed 1 000 000 USD (hereinafter referred to as "high value accounts") 1. Electronic record search. The Latvian financial institutions, providing messages, examine the data in electronic form in the Latvian financial institutions, providing messages, searching for a 1 point (B) of this section), the indication referred to in association with the United States. 2. the paper search. If the financial institution of Latvia, providing messages, maintain electronic databases with fields that cover the whole of paragraph (D) of this section) information referred to in point 3, there is no need to continue the search for paper documents. If the electronic databases without all the information, then in connection with high value accounts financial institution of Latvia, providing messages, also current research in the General folder on the client, and if this folder does not contain the required information, the Latvian financial institution that provides reports, research documents about the account, which it acquired in the last five years in relation to any point of this section 1) the indication referred to in association with the U.S. : a) the most recent documentary evidence collected in connection with your account; (b)) the most recent contract or documents for account opening; (c)) the latest documents that financial institutions of Latvia, providing messages, obtained according to the procedure of criminal money laundering and "know your customer" or for other purposes specified in the regulation; (d) any valid token) or signature and e) every valid permanent orders to transfer funds. 3. exceptionally, if the databases, the information available is sufficient. Latvia's financial institution, providing messages, do not look for paper documents, as defined in point (D) of this section 2), if the Latvian financial institutions that provide messages, electronic database includes the following information: a) the account holder or the resident status of citizens; (b)) the account holder's residence address and mailing address, which are the Latvian financial institutions records, which provide the messages; (c) the account holder) telephone number (s), if any, which are the Latvian financial institutions records, which provide the messages; (d)) or a permanent orders to transfer the funds in the account to another account (including account in other such Latvian financial institutions branch (Department) providing reports or other financial institution); (e)) or the account holder's address, with which it is affiliated, or an address to which you send it addressed to the mailing, and (f)) or in connection with the account exists or the signatory powers. 4. Customer service specialist consultation in order to ascertain the actual known information. In addition to electronic records and paper documents, as described above, the financial institution, which provides reports, believes that every great value account that passed the customer service specialist in charge (including any financial account and high value account rollup), is an account for which you want to report US if a customer service specialist will actually know that the account holder is a u.s. person. 5. Impact found indications of the relationship with the United States. (a)) if the above in-depth research on high value accounts, does not identify any point (B) of this section) referred to in paragraph 1, the indication of the relationship with the United States, and it is determined that the account holder is a specified person, according to the UNITED STATES this section 4) of paragraph (D) should not take further action until a change in the circumstances which led to the account is associated with one or more pointers on the relationship with the United States. (b)) if the above in-depth research on high value accounts, which is found in paragraph (B) of this section 1) the indication referred to in association with the United States or a change in circumstances, and the result of one or more pointers on the relationship with the UNITED STATES is associated with an account, financial institution, providing messages, consider that account is the account for which you want to report US If one does not choose to apply paragraph (B) of this section 2), and if one of the exceptions in this subparagraph are applied for this account. (c)) (A) of this section except (4) referred to the deposit accounts, believes that anyone who iepriekšpastāvēj an account under this section shall be designated as the account for which you want to give a message to the United States, in the years ahead is the account for which you want to report US if the account holder is still shown in the United States. E. additional procedures that are applied to high value accounts 1. If a private individual account iepriekšpastāvēj 2014 30 June is the high value account, financial Institute of Latvia, providing messages, must complete this section (D) in-depth research procedures specified in connection with this account until 2015 December 31. If, on the basis of that examination, it is determined that the account in 2014, or before, December 31 is the account for which you want to provide a message to the U.S., Latvia's financial institution, which provides reports, first report on account, provide the necessary information about such account with 2014 and once a year in the coming years. In case the account is defined as the account for which you want to submit a report to the U.S. by 2014 to 31 December and 30 June 2015, or before it, Latvia's financial institution, which provides reports, there is no need to provide information on the following account for 2014, but should provide information about once a year in the coming years. 2. If a private account is iepriekšpastāvēj great value account 30 June 2014, but becomes great value accounts in 2015 or any subsequent calendar year, the last day of the financial institution in Latvia, providing messages, must complete this section (D) specific in-depth research procedure in connection with this account for six months following the last day of the calendar year in which the account will become a high value account. If, on the basis of that examination, it is determined that the account is the account that the report of the United States, the financial authority of Latvia, providing messages, you must provide the required information for this account of a year in which established that the account is the account that the report of the United States, and once a year in the coming years. 3. If a financial institution in Latvia, providing messages, once applied in point (D) of this section described the in-depth research of high value procedure account, in one of the later years it is not necessary to apply this procedure, but for this section 4) of paragraph (D) in point customer service specialist interviewing. 4. If, in connection with the high value of a change in circumstances, the account and the account is associated with one or more 1 point (B) of this section) are annotated on the relationship with the U.S., Latvia's financial institution, which provides reports, considers that the account is the account that the report of the United States, unless they decide to apply paragraph 4 (B) of this section). 5. a financial institution, providing messages, implement procedures to ensure that customer service specialist will identify any change in circumstances in connection with the account. For example, if a customer service specialist will receive the information that the account holder is a new postal address in the United States, Latvia's financial institution, which provides reports, are obliged to believe that the new address is change, and so decide to apply paragraph 4 (B) of this section), and must obtain the appropriate documents from the account holder. F. Iepriekšpastāvējuš of private accounts, which have been documented in other applications. Latvia's financial institution, which provides reports and who has previously obtained the documents from the account holder to confirm that the account holder is neither a u.s. citizen nor a resident of the UNITED STATES, to fulfil their obligations in accordance with the qualified intermediary, the foreign partnership or foreign trust contract with the IID or to comply with its obligations under United States Code title 26, Chapter 61, not required in paragraph (B) of this section 1) referred to procedures for the lower value of the accounts or 1 point D)-3) those procedures with regard to high value accounts. III. new private accounts. To determine whether the account holders who are individuals and who opened the 2014 July 1 or after that date (hereinafter referred to as "the new private accounts"), are the financial accounts, which report the US, applies the following rules and procedures. A. Account for which research is required, not be identified or is not required to provide reports. If the financial institution of Latvia, providing messages, do not choose to act otherwise in respect of all new accounts of individuals or individual for any clearly identifiable groups of such account and if Latvia existing implementing rules are for such choice, further new accounts not subject individuals to research, it is not necessary to identify and no report US: 1) deposit account unless the account balance each calendar year or other eligible at the end of the reporting period does not exceed 50 000 USD. 2) accumulating in a life assurance contract, unless the amount of the monetary value of each calendar year or other eligible at the end of the reporting period does not exceed 50 000 USD. B. other new private accounts. When you open a new account, other than individuals mentioned in paragraph (A) of this section to the account opening (or 90 days after the end of the calendar year in which the account is no longer considered appropriate for paragraph (A) of this section), the Latvian financial institution, providing messages, the account holder must be obtained pašapliecinājum, which may be part of the account opening documents so that it can determine if the account holder is a resident for tax purposes in the UNITED STATES (for this purpose, consider that the US is a us resident alien for tax purposes even if the account holder is also a resident of another State tax), and must certify that such pašapliecinājum is justified based on the information that the financial institution of Latvia, providing messages, acquired in connection with opening an account, including the documents, collected according to procedures of the criminal money-laundering and "know your customer". 1. Where, in accordance with the pašapliecinājum account holder is a resident of the United States for the purpose of taxation, the Latvian financial institutions, providing messages, consider that account is the account that the report of the United States, and retrieves the account holder pašapliecinājum, which contains the NMN (such information may appear in the IID W-9 form or other similar approved form). 2. Where a change in circumstances in connection with the new private accounts, and the resulting financial institution of Latvia, providing messages, know or should have reason to know that the original account holder pašapliecinājum is not correct or reliable, the Latvian financial institutions, providing messages, cannot rely on the original pašapliecinājum, and must obtain a valid pašapliecinājum, which specifies whether the account holder is a U.S. national or resident for tax purposes. If the financial institution of Latvia, providing messages, can not get a valid account holder pašapliecinājum, it considers that the account is the account for which you want to report US. IV. Iepriekšpastāvējuš in company accounts. To determine whether the iepriekšpastāvējuš accounts which are undertakings (hereinafter referred to as "iepriekšpastāvējuš in the company accounts ') are the account on which the report of the United States, and that the account holder is a foreign financial institution, which is not a member of, applies the following rules and procedures. A. the company accounts, for which research is required, not be identified or is not required to provide reports. If one Latvian financial institution chooses to act otherwise, either in relation to all iepriekšpastāvējuš company accounts, or separately, in relation to any such account clearly identifiable group if in Latvia existing implementing rules are for such choice, iepriekšpastāvējuš company accounts balance or value at 30 June 2014, not exceeding 250 000 USD, do not need to perform the study, they were not identified and no report US unless the account balance does not exceed 1 000 000 USD. B. the company accounts, which need exploration. About iepriekšpastāvējuš company accounts balance or value at 30 June 2014, exceeds 250 000 USD and the iepriekšpastāvējuš company accounts where the balance exceeds 250 000 USD to 30 June 2014, but later the balance or value exceeding 1 000 000 USD to 2015 on the last day of the year or any subsequent examination must be taken under this section, the procedure laid down in point (C). C. corporate account, for which the report. In connection with paragraph (B) of this section iepriekšpastāvējuš listed in company accounts consider that account, on which the report of the United States, only accounts that are either the holder of one or more undertakings that have been designated a u.s. person, or liabilities to foreign companies that do not have foreign financial institutions that are controlled by one or more persons that are nationals or residents of the UNITED STATES. In addition, believes that the accounts which are foreign financial institutions, which is not a party, the competent institution of Latvia report on article 4 of this agreement, paragraph 1 (b)) referred to the total payments. D. research procedures to identify the accounts that report. The Latvian financial institutions, providing messages, the following research procedures to determine whether this referred to in point (B) of section iepriekšpastāvējuš of the business account holder is i) one or more of the specified person, (ii) the USA) liabilities to foreign companies that do not have foreign financial institutions that are controlled by one or more persons that are nationals or residents of the UNITED STATES, or (ii)) the foreign financial institution that is not a member of the: 1. determine the whether your company is a u.s. person. (a)) in order to determine whether or not according to the available information, the account holder is a u.s. person, are investigated information that is maintained in regulatory requirements or customer service purposes (including information collected according to procedures of the criminal money-laundering and "know your customer" provision). For this purpose the information showing that the account holder is a u.s. person, is the location of the registration or establishment, or an address in the United States. (b)) If information shows that the account holder is a u.s. person, a financial institution, which provides reports, considers that the account is the account for which you want to report US, if you get a pašapliecinājum account holder (which may be IID W-8 or W-9 form or similar approved form) or based on it available or publicly available information that is not reasonably certain that the account holder is not certain a u.s. person. 2. Determine whether the company, which is not a us company, is a financial institution. (a)) in order to determine whether or not according to the available information, the account holder is a financial institution, we are investigating information that is maintained in regulatory requirements or customer service purposes (including information collected according to procedures of the criminal money-laundering and "know your customer" provision). b) If according to the available information, the account holder is a financial institution or financial institution in Latvia, providing messages, finds ĀF in a list published in IIDA account holder the global identification number intermediary, then the account is the account for which you want to report US. 3. Determine whether a financial institution is a foreign financial institution, which is not a member, and to which the received payments relevant reporting on the amounts collected under article 4 of this agreement, paragraph 1 (b)). (a)) in accordance with point (D) of paragraph 3 (b)), if the account holder is a Latvian or other partner financial institution in connection with the account does not need to do further research, identification or reporting, if the financial institution of Latvia, providing messages, inclusions, finds that the account holder is the IID ĀF in the list published in the global account holder identification number intermediary or other information that is publicly available or applicable to the membership at the Latvian financial institutions providing reports. In this case, the account does not need further exploration, identification or reporting on it. (b)) if the account holder is a partner country of the Latvian or other financial institution, which identified the IID as a foreign financial institution, which is not a member, then the account is not considered account for which you want to give a message to the United States, but the account holder must report as provided for in article 4 of this agreement, paragraph 1 (b)). (c) If the account holder is not) the Latvian or other partner financial institution, the financial institution of Latvia, providing messages, believe that the account holder is a foreign financial institution, which is not a member, and for such payments to the company report in accordance with article 4 of this agreement, paragraph 1 (b)), unless the financial institution of Latvia, providing messages: 1) the account holder does not acquire pašapliecinājum (which can be IID W-8 or W-9 form or similar approved form) It is considered to be the appropriate certified foreign financial institution, with no need to switch to contract with IID ĀF, from the FATC statutory withholding released the true beneficiary, or foreign financial institution that is not included in the definition of ĀF as those terms are defined in the relevant U.S. regulations, Ministry of finance; or 2) if the account holder is a foreign financial institution is a member, or registered on the appropriate foreign financial institutions considered, which is not required to switch to contract with IID, ĀF does not check the global account holder identification number intermediary IID in foreign financial institutions published in the list. 4. Determine whether the account holder is a foreign company, which is not a financial institution, have the account for which you want to report US. In connection with the company's iepriekšpastāvējuš account holder, who has not been identified not as a u.s. person, nor a financial institution, a financial institution, providing messages, fix, i) or the account holder is a passive foreign company that is not a financial institution, (ii)) or the account holder is a controlling person, and (iii)) or a person who controls the company, is a United States national or resident. To determine this information, financial institutions of Latvia, providing messages, follow the indications (a) of this paragraph)-d) in the order that is most appropriate, considering the circumstances. (a)) to determine the persons who are controlled by the account holder, the Latvian financial institutions, providing messages, you can rely on the information collected and maintained pursuant to procedure for criminal money-laundering and "know your customer". (b)) to determine whether the company is a passive foreign account holder, other than a financial institution, a financial institution, providing messages, obtain account holder pašapliecinājum (which can be IID W-8 or W-9 form or similar approved form) for the determination of the status, if according to the publicly available information or cannot reasonably determine that the account holder is active in a foreign company that is not a financial institution. (c)) to determine whether the person who controls the passive foreign company that is not a financial institution, is a U.S. national or resident for tax purposes, the Latvian financial institutions, providing messages, you can rely on: 1) information collected and maintained in accordance with the procedures of criminal money laundering and "know your customer", if the account holder company iepriekšpastāvējuš is one or more foreign companies that is not a foreign financial institutions, and the account balance or value not exceeding $1 000 000; or 2) pašapliecinājum (which can be IID W-8 or W-9 form or similar approved form) prepared by the account holder or the person who exercises control if the account holder company iepriekšpastāvējuš is one or more foreign companies, not foreign financial institutions, and the account balance or value exceeding 1 000 000 USD. d) If any person, who controls a foreign company that is not a financial institution, is a national or resident of the UNITED STATES, believe that the account is the account for which you want to report US. E. research and additional procedures that are applied to the accounts of the company iepriekšpastāvējuš 1. iepriekšpastāvējuš company account trial balance or value at 30 June 2014, exceeds 250 000 USD, be completed by 30 June 2016. 2. The iepriekšpastāvējuš company account trial balance or value at 30 June 2014, not exceeding 250 000 USD, but 2015 31 December or next December 31 exceeds 1 000 000 USD, to be completed within six months from the last day of the calendar year in which the account balance or value exceeded 1 000 000 USD. 3. Where a change in circumstances in connection with the iepriekšpastāvējuš company account, and the resulting financial institution of Latvia, providing messages, know or have reason to know that the pašapliecinājum or other documents in connection with the account is not correct or reliable, the Latvian financial institutions, providing messages, repeated down the account status D of this section pursuant to the procedure laid down in paragraph 1. V. new business accounts. To identify the account, for which the report and accounts of the United States, that there's a financial institution that is not a member, with respect to the company financial accounts opened in 2014 July 1 or after that date (hereinafter referred to as "new business accounts"), the following rules and procedures. A. the company accounts for which there is no requirement for them to test, identify and report. If one Latvian financial institution that provides message, decide otherwise, either for all new business accounts, or separately for any clearly identified the following group of accounts, if the implementing provisions in Latvia provides such a choice, credit card account or revolving credit line, which is considered a new company account is not necessary to examine, identify, or notify if Latvia's financial institution, which provides reports and maintaining the following account implemented policies and procedures to prevent account balance surplus of 50 000 USD. Other new business accounts. For new business accounts, which are not discussed in this chapter, in section A, the Latvian financial institutions, providing messages, determines if the account holder has: (i) the person specified in the USA) ii) Latvian or other partner financial institution, (ii)) the foreign financial institution is a member, conform to the ĀF, which is not considered to be concluded in the contract with the IID ĀF, from the FATC statutory withholding released the true beneficiary whether the foreign financial institution, which is not included in the definition of ĀF as those terms are defined in the relevant U.S. regulations, Ministry of finance, or active or passive iv) a foreign company that is not a financial institution. 1. in accordance with paragraph (B) of Chapter 2) the Latvian financial institutions, providing messages, you can specify that the account holder is either active foreign company that is not a financial institution, or Latvia or other partner financial institution if the financial institution of Latvia, providing messages, based on such account holder status, on the basis of the global account holder identification number intermediary or other publicly available or relevant information in its possession. 2. If the account holder is a financial institution or other financial institution partners that IIDA is considered a financial institution that is not a member, then the account is the account to which the UNITED STATES, but the payment for the account holder must be reported, as laid down in article 4 of this agreement, paragraph 1 (b)). 3. in all other cases, the Latvian financial institutions, providing messages, obtain account holder pašapliecinājum to determine its status. Based on pašapliecinājum, the following rules apply: (a)) if the account holder is a u.s. person, a financial institution, which provides reports, considers that the account is the account for which you want to report US; (b)) if the account holder is a passive foreign company that is not a financial institution, a financial institution, providing messages, identifies the persons who exercise control, as determined in accordance with the procedures of criminal money laundering and "know your customer", and determine whether such person is a national of the United States or a resident on the basis of the account holder or such persons pašapliecinājum. If any of the following persons is a United States national or resident of Latvia's financial institution, which provides message, the account will be considered the account for which you want to report US; (c)) if the account holder is: i) U.S. person who is not a u.s. person, (ii) was specified) in the light of paragraph (B) of this section d, paragraph 3), Latvian or other partner financial institution, (ii)) the foreign financial institution is a member, conform to the foreign financial institution considered, which is not required to switch to contract with IID ĀF, from the FATC statutory withholding released the true beneficiary, or foreign financial institution not included in the definition of ĀF as those terms are defined in the respective States Treasury regulations, (iv) the foreign company) that is not a financial institution, or v) passive foreign company that is not a financial institution and any person controlling such liability is not a foreign company, the U.S. alien or resident, believes that the account is the account that the report of the United States, and there is no need to provide reports relating to this account; (d) if the account holder company) is a foreign financial institution, which is not a member (including Latvian or other partner financial institution whose IID identified as a foreign financial institution, which is not a member of the account is not the account for which you want to provide a message to the U.S., but the account holder must provide reports as set out in article 4 of the Treaty, paragraph 1 (b)). Vi. Special provisions and definitions. In implementing the aforementioned customer research procedures, the following additional provisions and definitions: a. reliance on pašapliecinājum and documentary evidence. The Latvian financial institutions, providing messages, cannot rely on pašapliecinājum or documentary evidence, if it knows or has reason to know that the pašapliecinājum or documentary evidence is not correct or reliable. B. Definitions. For the purposes of annex I of this document, the following definitions apply. 1. the procedure of criminal money laundering and "know your customer". Such procedures means procedures for customer research, which conducted the Latvian financial institutions that provide reports, in accordance with the requirements on laundering or similar requirements exist in Latvia, to be followed by the Latvian financial institution, which provides reports. 2. A foreign business that is not a financial institution. It's every company who is not a u.s. company and not a foreign financial institution, as defined in the respective States Treasury regulations, or is a company under paragraph (B) of this section 4, paragraph (j)) of these criteria, and this term also applies to any company that is not a us company, is of Latvian or other partner country resident, and not the financial institution. 3. Liability of a foreign company that is not a financial institution. It is every business, not i) foreign financial institution and is not active foreign company that is not a financial institution, or (ii) the tax on foreign ieturoš) a partnership or trust the ieturoš foreign tax, according to the United States Treasury regulations. 4. the assets of the foreign company, which is not a financial institution. It is a foreign enterprise that is not a financial institution and meet the following criteria: (a)) less than 50 percent of the company's gross income in the previous calendar year, or other appropriate accounting period is a passive income, and less than 50 percent of the company's assets held in the previous calendar year, or other appropriate accounting period is active, kept passive income; (b) such company shares) are regularly traded stable in stock market or business is the company's related company whose shares are traded on the stock market in a stable; (c)) is created in the USA, and all owners are receiving payment for this U.S. territory's bona fide residents; (d) the company is, the Government) (except the US Government), following the Government's political and administrative unit (which includes the Elimination of doubt, State, province, County, or local government), or the national authority, which shall carry out such of the functions of Government, or a political subdivision of the United States Government, international organization, central bank of issue, not the U.S. central bank of issue, or a company that fully belongs to one or more of the above; (e) the entire business) is to hold a (fully or partially) of one or more of the issued shares of subsidiaries, which are engaged in trade or business, other than a financial institution's business and to provide funding and services the following subsidiaries, but the company will not be a foreign company, which is not a financial institution, if it works (or it positions itself) as investment funds, such as private equity funds, venture capital fund the Fund, which carries out purchase transactions, with a busy means or investment vehicle that seeks to buy or finance the participation of society and be the holder of the following societies, keeping the capital assets for the purpose of investing; (f) undertaking not established yet), and it does not have a prior history of activity, but it makes capital investments in assets in order to do business, not the business of the financial institution; a foreign company that is not a financial institution, you can not get such a derogation, if since the company's initial creation date is the last 24 months; (g)) the company had no financial institution in the last five years and is in liquidation or reorganization of the assets of the process in order to continue or to resume the operation of the business, not the business of the financial institution; h) company carried on financing and hedging transactions with affiliated companies that are not financial institutions, or the following business tasks, and does not provide financial or hedging services not related to the company, the company affiliates, if such a group is mainly involved in the business, not the business of the financial institution; or i) company is "exceptional business" according to the United States Treasury; or (j)) the company meets all the following requirements: (I)) that is created and works only with the jurisdiction of residence, religion, charity, science, arts, culture, sport or education purposes; or is it up and running and it is under the jurisdiction of residence, the professional organisation, business, Chamber of Commerce, organisation of work, agricultural or horticultural organizations, civil Union or organization dedicated solely to the promotion of social welfare; (II)) that is exempt from income tax in the jurisdiction of residence; III) it does not have shareholders or members, who should gain ownership or interests in relation to the company's income or assets; (IV)) in accordance with the company's jurisdiction of residence of the legislation in force or the company's instruments of incorporation, the company's income or assets may not be distributed or used for the benefit of an individual or company that is not a charity, if such division or use is not related to the charitable activities of the company, or use to perform reasonable compensation payment or payment for services received, which is the company purchased the fair market value of property; and V) in accordance with the company's jurisdiction of residence, the current law or the instruments of incorporation of the company in case the company is dissolved or ceases to exist, all of its assets are distributed to the Government authority or other non-profit organization, or move the jurisdiction of residence of the company or any of its political subdivisions of Government property. 5. Those affecting pre-existing account. "Those affecting pre-existing account is a financial account that 2014 30 June there financial institution, which provides reports. C. account balance aggregation and exchange rules 1. adjustment of accounts. To determine the financial account of the balance of the aggregate or the value holder is a private person, a financial institution that provides reports, are required to collect all financial accounts that are held in the Latvian financial institution or a related company, but only if such Latvian financial institutions system following financial accounts are linked, using the data elements, such as a customer number or taxpayer identification number and it allows you to assemble the following account balances or values. For each of the jointly held account holder shall be jointly held in all financial account balance or value to be applied to the requirements set out in this paragraph for the aggregation. 2. the company's accounts. To determine the account balance or aggregate value, which is a company, financial institution, which provides reports, are required to take into account all financial accounts the company there in Latvia such financial institution or affiliated companies, but only if such Latvian financial institutions the following computer accounts are linked, using the data elements, such as a customer number or taxpayer identification number and it allows you to assemble the following account balances or values. 3. Special provision for the collection of customer service professionals. To determine a person's financial accounts kept in aggregate balance or value, in order to identify high value account, financial Institute of Latvia, providing messages, the requirement that where the customer service officer knows or has reason to know, or financial accounts directly or indirectly belong to one and the same person or they directly or indirectly control or are created (not a fiduciary relationship) are the same person , all of the following accounts are compiled. 4. Currency Exchange. To determine the account balance or value which is expressed in a currency other than u.s. dollars, the financial institution of Latvia, providing messages, converts dollars set out in annex I of the threshold amount expressed in the currency of the account, using a published rate of instant transactions it the last day of the calendar year preceding the year in which the financial institution of Latvia, providing messages, determines the account balance or value. D. Documentary proof. This annex acceptable documentary evidence is one of the following documents: 1 a certificate of residence), issued by the authorized government body exercising jurisdiction (e.g. Government or its agency or municipality), where, after receiving the payment, to the resident; 2) in the case of individuals, a valid identification card issued by the authorized government body (e.g. Government or its agency or municipality), which contains a person's name, and which is generally used for the identification of the person; 3) in the case of the company any official document issued by an authorized government body (such as the Government or its agency or municipality), which contains the company name and head office jurisdiction (or a u.s. territory), in which, after the company's words, it is resident or jurisdiction (or a u.s. territory), in which the company is registered or is established; 4) in relation to the financial account of the jurisdiction in which the provisions of criminal money laundering prevention approved IID associated with the qualified intermediary agreement (as defined in the relevant U.S. regulations, Ministry of Finance), any document that is not W-8 or W-9 form, to which reference is made in the qualified intermediary agreement in the annex to the individuals or to identify companies; 5) all types of financial reports, third party kredītpārskat, suggested things about bankruptcy or the U.S. Securities and Exchange Commission. (E) alternative procedures financial accounts that belong to individual cash value insurance beneficiaries. The Latvian financial institutions, providing messages, you can assume that the cash value of the insurance contract, individual recipient (other than the owner) who receives a benefit in the event of death in the UNITED STATES is not specified person and may not consider the following financial accounts on the account, for which the U.S. should be reported, unless the financial institution of Latvia, providing messages, have up-to-date information or reason to believe that the recipient is specified in the United States. Latvia's financial institution, providing messages, there is reason to believe that the cash value of the insurance contract, the beneficiary is specified, if the U.S. person information wrapped up in Latvia's financial institution, which provides the message and related to the content of the beneficiary, the UNITED STATES signs described in this section 2 of annex 1, point 1 (B)). If Latvia's financial institution, which provides message is up-to-date information or reason to believe that the recipient has indicated a u.s. person, a financial institution that provides reports, is to act in accordance with the procedures described in this 1. 2. section B of the annex, point 3). F. reliance on third parties. Regardless of whether the choice made in accordance with section 1 of annex 1, point (C) must allow Latvia Latvian financial institutions that report to, rely on due diligence procedures by third parties, to the extent as provided for in the relevant United States Treasury.   Annex II Following where appropriate authorities are considered exempt from withholding the true beneficiaries or suspected, according to foreign financial institutions (ĀF), and these accounts are excluded from the definition of the financial account. This annex II may be amended by mutual written agreement of the competent Latvian authorities and the United States: 1) include additional authority and accounts for which there is a low risk that it could use the US people to avoid U.S. tax evasion, and that the signs at the moment of signing of the contract is similar to the authorities and the accounts, which are described in annex II; or 2) off authorities or accounts where a change to the conditions, the more there is not low risk that it could use the US people to avoid U.S. tax evasion. To any such inclusion or exclusion must be in force at the time of signature of the decision, unless it is stated otherwise. Following a common procedure, a decision may be included in the total of the mutual agreement or arrangements, which are described in article 3 of the Treaty, paragraph 6. I. the fair exempted from the withholding of the beneficiaries, except for the funds. Such authorities should be considered Latvian financial institutions that do not provide reports as well as from the exempt withholding the true beneficiaries of the U.S. Internal Revenue Code 1471 and 1472. application of article, with the exception of the duty arising from the existing obligation in relation to financial activities, which are involved specified in insurance companies, closed-institution or deposit. A. the Government's authority. The Latvian Government, any Latvian administrative territorial formations (where there is doubt, include State, province, County or municipality) or any wholly-owned agency of Latvia or the institution, as well as any of the above (each means "Government authority"). This category includes an integral part of Latvia, control bodies and administrative territorial formations. 1) an integral part of Latvia, means any person, organization, agency, Bureau, agency, Fund or other institution that forms the body of the Government of Latvia. The Government institution must credit the net revenue this account or other accounts of Latvia, so that no one individual did not benefit from this income. An integral part does not contain any natural person who is a sovereign, or official who is the administrator, who shall act in accordance with the private or personal jurisdiction. 2) controlled institution means an institution which, after their form is separated from Latvia or otherwise constitutes a separate legal entity provided that: (a) the institution fully owned) one or more of the institutions of the Latvian Government, which is fully controlled by this body either directly or through one or more control bodies; (b) the net revenue of the authority) should be included in the account or one or more of the institutions of the Latvian Government accounts to any private person does not benefit from this income; (c)) after the dissolution of the assets are transferred to the authority in one or more of the Latvian Government authorities. 3) no private person do not benefit from this income, if that person is a government program for beneficiaries and programme activities are made public in connection with the purposes of the common welfare or apply to any Government phases. However, notwithstanding the foregoing, it is considered that an individual benefit from income if the income arises through a government body to carry out commercial activities, such as commercial banking business that provides financial services to individuals. B. International Organization. Any international organisation or its wholly owned agency or institution. This category includes any intergovernmental organization (including international organizations), 1) based on the way the Government, not the United States Government; 2) which is in force in the main Office of the agreement with Latvia; 3) from which income individuals do not benefit. C. the central bank. The Bank Of Latvia. II. Funds that qualify as exempt from withholding the true beneficiaries. Such authorities should be considered Latvian financial institutions that do not provide reports, and for withholding exempt from the true beneficiaries of the U.S. Internal Revenue Code 1471 and 1472. application of article. A. Pension Fund specified in a contract. Latvia established the Fund, provided that the Fund shall, in accordance with the income tax treaty between Latvia and the United States are entitled to relief, which it derives income from sources in the United States (or it would be entitled to such benefits) as a resident of Latvia, which satisfies any applicable limitation of provisions and benefits mainly work pension or old-age benefits or manage. B. open pension funds. Latvia established a fund to provide retirement, disability and death benefits, or any combination of them beneficiaries who work or worked for (or have such specified person) for one or more employers, as reimbursement for the services provided, provided that: 1) to the Fund is not one to which the beneficiary is entitled to more than five percent of the Fund's assets; 2) Fund is subject to government regulation and each year provides information reported as beneficiaries of the Latvian authorities concerned; 3) Foundation will meet at least one of the following requirements: (a)) in accordance with Latvian law fund your retirement or pension plan status in Latvia are not generally taxable capital income tax; (b)), the Fund receives at least 50 percent of its total contributions (except asset transfers from other plans, which are described in this section (A), (D), or from retirement and pension accounts, which are described in annex II, point (A) of section V 1)) from the sponsoring employers; (c)) the distribution of funds or withdrawal of funds is permitted only in certain cases, arising in connection with the retirement, disability or death (with the exception of the allocation of funds to extend other pension funds described in this section (A), (D), or to the retirement and pension accounts, which are described in annex II, point (A) of section V 1)) or the penalty is applied on the distribution of funds or withdrawal made before the accession of the specific case; (d) employee contributions) (except in certain authorized contributions) Fund limited reference to the employee's earned income or the year they may not exceed 50 000 UNITED STATES dollars by applying the provisions laid down in annex I for the accounts and currency conversion. C. closed Pension Fund participation. Latvia established a fund to provide retirement, disability and death benefits to beneficiaries who work or worked for (or have such specified person) for one or more employers, as reimbursement for the services provided under the condition that: 1) Fund is less than 50 members; 2) Fund financially supported by one or more employers, which is not a passive investment authority or foreign financial institutions; 3) employee and employer contributions in the Fund (excluding transfers of assets from the pension funds laid down in the Treaty, which are described in paragraph (A) of this section, and from the pension accounts, which are described in annex II, point (A) of section V 1)) the limiting reference to earned income and employee compensation; 4 members who are not Latvian) residents are not eligible to hold more than 20 percent of the Fund's assets; 5) Fund is subject to government regulation and each year provides information on the beneficiaries concerned Latvian tax authorities. D. from withholding the true beneficiaries of the free pension fund. From withholding tax-exempt true beneficiary Fund established in Latvia to provide retirement, disability and death benefits to beneficiaries or participants who are or were deducted from the fair exempted employees of the beneficiary (or such specified person), or is not, and was not an employee, if such beneficiaries or members benefits are provided reimbursement for services that were personally delivered to the fair from withholding tax-exempt beneficiary. E. Investment Authority owns fully exempt from withholding the true beneficiaries. The authority is a financial institution only because it is the investment authority, on condition that each direct authorities shareholders are deducted from the true beneficiary released and each direct debt interest owner of such authority is either a deposit institution (for loans issued such an authority) or from withholding released true beneficiary. F. the State funded pension scheme. State funded pension schemes, including investment plans, the scheme is established and regulated in accordance with the State funded pension law, provided that the schemes meet the 1. and (2) the requirements of this section, at least one of the requirements of paragraph 3. G. private pension funds. Private pension funds are established and regulated under the law on private pension funds, "provided that the Fund shall comply with paragraph 1 and 2 and at least one of the requirements of paragraph (B) of this section, the requirements of paragraph 3. III. Small or limited competence of financial institutions that are deemed to satisfy the ĀF. The following financial institutions are Latvian financial institutions that do not provide reports which are deemed to satisfy the ĀF of the U.S. Internal Revenue Code 1471. for the purposes of article. A. financial institution with the local customer base. Financial institution meet the following requirements: 1) the financial institution must be licensed and regulated as a financial institution in accordance with the legislation of Latvia; 2) a financial institution outside of Latvia may not be a permanent place of business. For this purpose, a permanent place of business does not include location, for which the company is not aware and which financial institution solely for the administrative support functions; 3) financial institution may not attract clients or account holders outside of Latvia. For this purpose, will not be considered a financial institution that has attracted clients or account holders outside Latvia solely because: (a) the financial institution) manages the Web site, provided that this website does not indicate that the particular financial institution offers financial accounts or services for non-residents and not otherwise trying to attract U.S. customers or the account holder or (b)) the advertised print media or by radio or television running or is distributed mainly in Latvia but also in the works or are common in other countries provided that the advertisement did not state that the financial institution offers financial accounts or services for non-residents and not otherwise trying to attract U.S. customers and account holders; 4) in accordance with Latvian law, a financial institution must identify the domestic account holders either for reporting of information, or withholding taxes with respect to resident financial accounts, or to provide for due diligence requirements in the fight against money laundering; at least 98% 5) financial accounts, which are financial institutions under management must be Latvian or resident in a Member State of the European Union in the accounts (including residents of the authority); 6) beginning with July 1, 2014, or before the financial institutions and rules and procedures must be in accordance with the procedures set out in annex I and the provisions to prevent a financial institution offering financial accounts financial institutions that are not members, and to monitor whether the financial institution opens or maintains any U.S. financial accounts to the specified person that is not resident in Latvia (including the UNITED STATES, a person who was a resident of Latvia When the financial account was open, but after opening the account, that person was not resident in Latvia) or any passive foreign financial institution with persons in the exercise of control and who are U.S. residents or u.s. citizens, but who are not residents of Latvia; 7) following events and procedures must ensure that, if someone is identified in the financial account, which is part of the U.S. to a designated person who is not a resident of Latvia or passive foreign financial institution with persons in the exercise of control and who are U.S. residents or u.s. citizens, but who are not residents of Latvia, a financial institution must report on such financial account, as would be required if the financial institution would be Latvia's financial institution providing reports (including pursuant to applicable registration requirements IID FATC (U.S. internal revenue service laws on foreign account tax compliance) Web site), or to shut down such a financial account; 8) in relation to those affecting pre-existing accounts, belonging to a person who is not a resident of Latvia, or of belonging to the institution, the financial institution should check these those affecting pre-existing accounts in accordance with the procedures set out in annex I applicable to those affecting pre-existing accounts to identify any U.S. account, which must report, or financial accounts, belonging to a financial institution that is not a member, and must report on such financial account, as would be required if the financial institution would be Latvia's financial institution providing reports (including pursuant to applicable registration requirements IID FATC Web site), or to shut down such a financial account; 9) every financial institution related authority that is a financial institution, must be enclosed in or established in Latvia and, with the exception of any associated Office, which is in this section of annex II, point (A), (D) the Pension Fund, and to meet the requirements set out in paragraph (A); 10) financial institution shall apply the rules or practices that discriminate against U.S. persons mentioned, which is a resident of Latvia, financial account opening and maintenance. B. local bank. Financial institution that meets the following requirements: 1) financial institution operating exclusively as (and is licensed and regulated in accordance with Latvian law) a) bank or (b)) a non-profit cooperative credit unions or similar credit; 2) financial institutions business includes primarily deposit-taking and lending, for the bank unrelated to retail customers and to credit unions or similar credit cooperatives, members provided that one Member may not be more than five percent participation in credit unions or similar credit of the cooperative; 3) financial institution meets the requirements set out in paragraph (A) of this section 2 and 3 above, provided that, in addition to the restrictions on the website described in paragraph 3 of this section in this Web site does not allow you to open financial accounts; 4) financial institution balance sheets assets not more than 175 million u.s. dollars, and the total financial institution and any relevant authorities, their total assets account for no more than 500 million us dollars in the consolidated or total balance sheets; 5) any associated authority must be included, or established in Latvia, and to any related body that is a financial institution, not including any associated Office, which is in this section of annex II, point (A), (D) the pension fund or a financial institution that has a lower value accounts, described in paragraph (C) of this section, must meet the requirements set out in paragraph (B). (C) a financial institution that maintains only the lower value accounts. The Latvian financial institution that meets the following requirements: 1) financial institution do not have investment authority; 2) any financial institution or affiliated institutions maintain account balance or its value does not exceed 50 000 UNITED STATES dollars by applying the provisions laid down in annex I for the accounts and currency conversion; 3) financial institution balance sheets assets not more than 50 million us dollars, and the total financial institution and any relevant authorities, their total assets account for no more than $50 million in the consolidated or total balance sheets. D. qualified credit card issuers. The Latvian financial institution that meets the following requirements: 1) a financial institution is a financial institution only because it is issued credit cards and accept deposits only if the customer makes a payment that exceeds the balance on the card payment and overpayment is refunded to the customer immediately; 2) from July 1, 2014, or before a financial institution implemented rules and procedures, either to prevent the customer's deposit exceeds 50 000 USD, or to ensure that any client deposit that exceeds 50 000 USD, in each case, the application of the provisions laid down in annex I for the accounts and currency translation, is refunded to the customer within a period of 60 days. For this purpose, the customer deposit does not apply to the credit balance in the event of a fee dispute, but it does not include credit balances resulting from a return. IV. Investment institutions that are deemed to satisfy the ĀF and other special rules. Financial institutions described in this section (A), (E), is a Latvian financial institutions that do not provide reports and considered to be in conformity with the ĀF of the U.S. Internal Revenue Code 1471. for the purposes of article. In addition, paragraph (F) of this section lays down specific rules applicable to the investment authority. (A). a documented trust. The trust, established in accordance with Latvian law, trust the trustee is a U.S. financial institution, which provides reports in accordance with the reporting model 1 ĀF or ĀF and who is a member, and shall report all necessary information in accordance with the Treaty, in respect of all trust accounts, for which the UNITED STATES has reported. B. investment authority Sponsored and controlled foreign corporation. Financial institution described in paragraph 1 (B) of this section) or 2), which is sponsoriestād, corresponding to the 3 point (B) of this section). 1) financial institution's sponsored investment authority, if: (a)) it is an investment institution established in Latvia, which is not considered to be foreign mediation, withholding or withholding foreign trust in accordance with the relevant provisions of the Ministry of finance in the US; (b)) the authority has agreed with the financial institution to act as financial institutions sponsoriestād. 2) financial institution is sponsored by a controlled foreign corporation if: (a) the financial institution is controlled) foreign corporation established under the laws of Latvia, which is not considered to be foreign mediation, withholding or withholding foreign trust in accordance with the relevant provisions of the Ministry of finance in the US; (b) a financial institution) wholly owned, directly or indirectly, the US financial institution, which provides the message and which agrees to act or require financial institutions to branch to act as financial institutions sponsoriestād; (c) a financial institution with sponsoriestād) are common in electronic accounting system, which allows for sponsoriestād financial institutions identify all account holders and beneficiaries of payments, as well as access to all the financial institutions maintain accounts and information, including, but not limited to customer identification information, customer records, account balances and any account holder or payment the payments made to the recipient. 3) Sponsoriestād complies with the following requirements: (a)) sponsoriestād is authorized to act on behalf of the financial institution (as a Fund Manager, trustee, Corporate Director, the managing partner) to comply with applicable registration requirements IID FATC registration Web site; (b) is registered as sponsoriestād) sponsoriestād u.s. Internal Revenue Service IID FATC registration Web site; sponsoriestād-c) if identified for any U.S. financial institution account, which must be reported, sponsoriestād is registered financial institution pursuant to the applicable registration requirements registration FATC IID website 2015 December 31 or not later than this date and the date that is 90 days after such a U.S. account, which must be reported, the initial identification; (d)) sponsoriestād is the Act of consent to the financial authority and perform all due diligence, withholding, reporting and other requirements to which the financial institution would be required if it were a financial institution in Latvia, providing messages; e) sponsoriestād identifies a financial institution and the financial institutions include the identification number (which was obtained pursuant to the applicable registration requirements IID FATC registration website) all over the completed message on behalf of the financial institution; (f)) is not canceled, the sponsor of the sponsoriestād status. C. sponsored, narrow set of owned investment tool. The Latvian financial institution that meets the following requirements: 1) a financial institution is a financial institution only because it is the investment authority and is not considered to be foreign mediation, withholding or withholding foreign trust in accordance with the relevant provisions of the Ministry of finance in the US; 2) sponsoriestād is a U.S. financial institution, which provides reports (reporting model 1 ĀF or ĀF), which is a member of, is authorized to act on behalf of the financial institution (as a professional Manager, trustee or managing partner) and agree, on behalf of the financial institution complete all due diligence, withholding, reporting and other requirements to which the financial institution would be required if it were a financial institution in Latvia, providing messages; 3) financial institution does not present itself as an investment instrument to unrelated parties; 4) financial institution twenty or fewer persons own all debt interest and participation in the share capital of (not taking into account the debt interest, which belongs to the ĀF, which is a member of, and ĀF, as appropriate, as well as participation in the share capital, which is part of the authority, if the financial institution it holds 100 percent participation in the share capital and it has sponsored financial institution described in this paragraph (C)); 5) sponsoriestād complies with the following requirements: (a) is registered as sponsoriestād) sponsoriestād u.s. Internal Revenue Service IID FATC registration Web site; (b) Agreement Act sponsoriestād) financial authority and perform all due diligence, withholding, reporting and other requirements to which the financial institution would be required if it were a financial institution in Latvia, providing messages, and six years to keep all respect to financial institution gathered documentation; (c)) sponsoriestād identifies a financial institution all the reports made on behalf of the financial institution; (d) the sponsor has not canceled sponsoriestād) status. D. investment advisors and investment managers. Latvia established investment authority is a financial institution only because it: 1) provides advice on investing and running a Word; 2) manages portfolios and work on behalf of the client with the purpose to invest in, manage or administer funds on behalf of the client is invested in a financial institution, other than a financial institution that is not a member. E. collective investment instruments. Latvia established investment authority which are regulated as collective investment instruments provided that all collective investment instruments (including debt percentage exceeding 50 000 US dollars) belongs to one or more of the exempt withholding the true beneficiaries, active ĀF, described in section VI of annex I, point 4 (B)), the US people who are not U.S. persons mentioned, or financial institutions. F. Special rules. Investment institution, the following provisions shall apply: 1) concerning the participation of the investment authority, which is the collective investment instruments as described in paragraph (E) of this title, any investment authority (other than a financial institution through which the parts are kept in the collective investment instruments) reporting obligations are considered fulfilled; 2) participation: (a) the jurisdiction established in) partners investment authority which are regulated as collective investment instruments which all parts (including debt interest exceeding 50 000 US dollars) belongs to one or more of the exempt withholding the true beneficiaries, active ĀF, described in section VI of annex I, point 4 (B)), the US people who are not U.S. persons or specified financial institutions that are not members; (b) the investment institution) be considered as collective investment instruments in accordance with the relevant provisions of the Ministry of finance in the US; any investment authority that is a financial institution (other than a financial institution through which the parts are kept in the collective investment instruments) reporting obligations are considered fulfilled; 3) regarding participation in the established investment authority which is not described in paragraph (E) of this section or paragraph 2 (F)) in accordance with article 5 of the Treaty (3), all the other investment institutions reporting obligations with respect to such participation is deemed to be fulfilled where such investment authority or other person shall communicate information for which the first investment should be reported to the authority in accordance with the Treaty, related to such participation. V. financial accounts exclude accounts and products. The following accounts and products are excluded from the definition of financial accounts and, therefore, are not considered U.S. accounts, which are reported. A. certain savings accounts. 1) pension accounts. In Latvia the pension accounts maintained in accordance with the legislation of Latvia shall meet the following requirements. (a) the account is subject to the regulation) as a personal pension account or is part of a registered or regulated pension plan to provide retirement benefits (including disability allowance or allowance in the event of death); (b)) are applicable to the account tax incentives (i.e., contributions to the account, which would otherwise be subject to taxation in accordance with Latvian law, are deductible or turned off from the account holder's gross income, or taxed at a reduced rate or investment income taxation from the account is extended or taxed at a reduced rate); (c)) for account requires annual information reporting to the relevant authorities of Latvia; (d) withdrawal of funds is set) special conditions – the retirement age, disability, or death, or to apply penalties for withdrawals before such special cases, joining; e) annual contribution limit is 50000 u.s. dollars or less, when applying the rules laid down in annex I for the accounts and currency conversion. 2) savings account, not a retirement savings account. In Latvia maintain account (other than an insurance or annuity contract) that in accordance with the legislation of Latvia shall meet the following requirements. (a) the account is subject to the regulation) as a savings instrument that is not intended for retirement; (b)) are applicable to the account tax incentives (i.e., contributions to the account, which would otherwise be subject to taxation in accordance with Latvian law, are deductible or turned off from the account holder's gross income, or taxed at a reduced rate or investment income taxation from the account is extended or taxed at a reduced rate); (c) withdrawals for) specific criteria related to the savings account (for example, education or the provision of medical benefits), or apply a penalty for withdrawals prior to the execution of such criteria; (d) the annual contribution) limit is 50 000 us dollars or less, when applying the rules laid down in annex I for the accounts and currency recalculation. B. life insurance contracts for a specific period of time in Latvia the assurance contract contain a period that occurs before the insured person reaches 90 years of age, provided that the agreement meets the following requirements: 1) periodic premiums that will not decrease over time, is due at least every year, while the contract is in force or to the insured person reaches the age of 90gad, whichever period is shorter; 2) agreement is not the amount of the contract to which any person may have access to (withdrawals, loan or otherwise), without losing the contract; 3) amount (except in the case of death benefits) payable upon termination or cancelling the contract, may not exceed the total of the premiums paid under the contract, except for death, illness or expense charge (regardless of whether or not it is used) contract period and any other amounts paid before the suspension or cancellation of the contract; 4) the Treaty shall not apply to the successor of crediting. C. other certain life insurance contracts. Life insurance (lifetime pension) in Latvia is supervised in accordance with the State funded pension law. D. property account. The account maintained in Latvia, which owns the property, only if the account is to be found in the documentation, a copy of the deceased's will or the death certificate. E. transaction accounts. The account maintained in Latvia, established in one of the following objectives: 1) the court order or judgment; 2) real and personal property for sale, Exchange or lease, provided the account meets the following requirements: (a) the account is funded) only with advance payment, deposit, the amount of investments to guarantee the implementation of the commitments, which are directly associated with the transaction, or a similar payment, or is financed by financial assets deposited in the account in connection with a property sale, Exchange or lease; (b)) is established and the account is used only to ensure the buyer's obligation to pay the purchase price of the property, the seller to guarantee the payment of contingent liability as well as to the lessor or the lessee pay for any damage to the rented property in respect, as was stated in the lease; (c) active) account, including earnings from them, will be paid or otherwise distributed to a customer, vendor, lessor or lessee's interest (including to comply with the obligations of such a person) when the property is sold, exchanged or transferred, or end the lease; d) account is similar to a reserve or account established in connection with the sale of a financial asset or Exchange; e) account is combined with the credit card account; 3) financial institutions, which serves to guarantee the loan of property, is obliged to reserve tranche, only to promote the real estate tax or insurance fraud after a period of time; 4) financial institutions are obliged to promote tax evasion only after some time. F. Partnerjurisdikcij for the accounts. The account, which is maintained in Latvia and which is excluded from the definition of financial accounts in accordance with the agreement between the United States and other partnerjurisdikcij, to promote the implementation of the FATC provided that, in accordance with such other legislation such partnerjurisdikcij account is subject to the same requirements and supervision, as if it were conceived in this partnerjurisdikcij and maintain the partnerjurisdikcij of the financial institution in partnerjurisdikcij. Vi. Definitions. The designations referred to above, the following additional definitions apply: a. reporting model ĀF 1. The term "reporting model 1 ĀF" represents a financial institution in respect of which the Government or agency, not the US Government or agency agrees to receive information and to exchange them in accordance with Model 1 IG (intergovernmental agreement), other than a financial institution, which is considered to be a financial institution, other than a member, in accordance with Model 1 IG. The purpose of this definition, the term "Model 1 IG" shall mean an agreement between the United States of America or the Ministry of finance and the Government, not the U.S. Government, or one or more of its agencies, to implement the FATC, financial institutions reported the following Government or its agency, not the US Government or agency, followed by the information of the following automatic exchange with the U.S. internal revenue service. B. ĀF, which is a member of. The term ĀF, which is a member of the "means a financial institution that has agreed to meet the requirements of the Treaty, ĀF including Model 2 IGA described the financial institution that has agreed to meet the requirements of the Treaty ĀF. The term ĀF, which is a member of the UNITED STATES "also includes financial institutions, providing messages, through qualified affiliate, unless such affiliate is Reporting model" 1 ĀF ". ĀF this definition in the agreement represents a contract, which defines the requirements for the financial institution to be considered under the U.S. Internal Revenue Code 1471. (b)). In addition, this definition of the term "Model 2 IG" shall mean an agreement between the United States of America or the Treasury Department and the Government, not the U.S. Government, or one or more of its agencies to facilitate the implementation of the FATC financial institutions directly reporting to the U.S. internal revenue service in accordance with the requirements of the Treaty ĀF, supplemented by the exchange of information between such Government, not the US Government or its agencies and the U.S. internal revenue service.
The Government of the Republic of LATVIA: Andris Vilks on behalf of the Government of the United States of America: marks the unofficial translation Pekal memorandum of understanding for the Government of the Republic of LATVIA and the Government of the United States of America agreement on international TAX duties and the LAW on foreign account TAX obligations (FATC) introduction Today by signing the Government of Latvia and the Government of the United States of America agreement on international tax duties and the law on foreign account tax obligations (FATC) (hereinafter referred to as the agreement) Latvia and United States representatives want to confirm the following agreement: Agreement relating to article 1, paragraph 1 (definitions), if the securities are registered in the Latvian central depository, as laid down in the law on the financial instruments market in part E, which holds one or more other financial institutions that do not have foreign financial institutions that are not members will be considered that the relevant financial accounts there that other financial institutions and other financial institutions would be responsible for any reporting of such financial accounts. It is understood that the central depository may refer to the following other financial bodies in accordance with article 5, paragraph 3. Annex II, section V (financial accounts Exclude accounts) if the accounts there units found to be exempt from withholding the true beneficiaries in accordance with section II of annex II, the following accounts are excluded from the definition of financial accounts and are not considered U.S. accounts, for which you must report. Signed in Riga, in duplicate, in the English language, 27 June 2014.
The Government of the Republic of LATVIA: Andris Vilks on behalf of the Government of the United States of America: marks of Pekal