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OECD update on Exchange of Information
26/08/2015

OECD Report on jurisdictions’ readiness to exchange of information.

The OECD has recently published its report on the peer review process of twelve jurisdictions which have yet to complete either the Phase 1 or the Phase 2 review process.

The Phase 1 review process being the initial examination of the jurisdiction’s legal and regulatory framework, which must be completed before the Phase 2 examination can take place of the implementation of the legal and regulatory framework in practice.

There are seven jurisdictions under Phase 1 review which are the subject of the most recent report. The countries are Albania, Burkina Faso, Cameroon, Dominican Republic, Lesotho, Pakistan and Uganda. The respective reports concluded that each country had the legal framework in place that would enable them to proceed to the next stage of the process which considers the exchange of information processes that are in place.

The Marshall Islands in its earlier Phase 1 report found there were significant gaps in its legal framework and exchange of information practices. The Marshall Is. has taken action to rectify the deficiencies that the report highlighted and requested that a supplementary review be undertaken. The supplemental report concluded that the steps taken to implement the recommendations of the earlier report had addressed the concerns and that the Marshall Is. could move to a Phase 2 review.

At the conclusion of the Phase 2 assessment in 2013, Austria was rated as ‘Partially Compliant’. Having adopted the recommendations in the report, Austria requested a supplementary review as a result of which it has been re-rated as ‘Largely Compliant’. After a similar supplemental review, the British Virgin Islands has had its rating increased from ‘Non-Compliant’ to ‘Largely Compliant’ which reflects the significant improvements that have been made in the jurisdiction in the last two years.

Since the system was introduced, almost 200 reviews have been completed of the Global Forum’s 127 members. 21 jurisdictions have been rated at the highest level as ‘Compliant’, 46 ‘Largely Compliant’, 10 rated ‘Compliant’ with 3 jurisdictions rated as ‘Non-Compliant’, from a total of 80 nations that have completed the Phase 2 review process. Inadequacies to the legal and regulatory framework have resulted in 11 jurisdictions being blocked from proceeding to Phase 2 review.

The Global Forum has launched a multilateral process to evaluate 90 jurisdictions that have committed to the automatic exchange of information by 2017 or 2018, under the OECD Automatic Exchange on Information. The process will evaluate confidentially and data safeguards that are in place in the respective jurisdictions.

When we have further information on this multilateral process we will provide a further news update.

For more information on this subject please contact Peter Brigham p.brigham@rosemont-mc.com