Bahamas: Amendments to AEOI regulations

The Bahamas Ministry of Finance on July 11, 2024, issued the Automatic Exchange of Financial Account Information (Amendment) Act, 2024, which amends the Automatic Exchange of Financial Account Information Act, 2016 under the common reporting standard (CRS) regime. The amendments are as follows:

• Section 2(1) was revised to update the definition of “entity” to further clarify that it does include a legal person or legal arrangement “such as a corporation, partnership, trust, or foundation.”
• Section 15 (Anti-avoidance or anti-circumvention), which deals with situations when a person enters into arrangements with the intent to circumvent the CRS, was amended to define “person” as “an intermediary or account holder.”
• A new subsection “C” (Sanctioning of a legal arrangement) was added to section 15 that states, if a reporting financial institution that is subject to penalties is either a legal arrangement or a branch in the Bahamas, then the penalty would be imposed on any person responsible for managing the affairs of the financial institution in the Bahamas. For the purposes of this section, “any person responsible” includes the trustee of a trust and each partner in a partnership.

In addition, the Ministry on June 25, 2024, issued the Automatic Exchange of Financial Account Information (Amendment) Regulations, 2024, which amends the Automatic Exchange of Financial Account Information Regulations, 2017. The amendments are as follows:

• A new paragraph “d” was added to Regulation 9, which allows the Competent Authority to inspect financial institutions’ books, records, and other documentation during on-site visits.
• Minor definition updates were made to Regulation 10.

The first and second schedules were updated to include the latest list of participating and reportable jurisdictions, respectively.

Read a July 2024 report prepared by the KPMG member firm in the Bahamas