MOSCOW, December 8 (RAPSI) – The world’s four largest audit firms, which provide services under the FATCA norms, have provided contradictory consultations to their Russian clients, Kommersant newspaper writes on Monday.
The Big Four are the four largest international professional services networks, offering audit, assurance, tax, consulting, advisory, actuarial, corporate finance, and legal services.
The provisions commonly known as the Foreign Account Tax Compliance Act (FATCA) became law in March 2010. It targets tax non-compliance by US taxpayers with foreign accounts. Russian banks started working according to the provisions in July 2014.
According to some companies, many banks have requested that their counteragent banks inform them if they had joined FATCA or planned to do so by the end of the year. However, other banks believe that they can do this by July 2016.
The reason for the discrepancy is the absence of a common stand among their consultants – PwC, Deloitte, EY and KPMG. They are divided over the interpretation of “prima facie FFI,” which must be identified by the end of this year, according to FATCA requirements. Russian law does not include this interpretation.
PwC and Deloitte say that all banks must be considered “prima facie FFI,” and that their identification must therefore be completed by yearend. “German law does not include this term, but all banks are considered prima facie FFIs in Germany per se,” said PwC Legal CIS partner Maxim Kandyba.
KPMG and EY do not see it that way. “Under US law, prima facie FFIs include qualified and non-qualified intermediaries and foreign entities that have a North American Industry Classification System or Standard Industrial Classification code that indicates that it is a financial,” said Nadezhda Ryzhova, a senior consultant with KPMG.