The Argentine Ministry of Foreign Affairs (the Ministry) informed that the Tax Information Exchange Agreement entered into by Argentina and the United States of America (the Agreement) will enter into force on 13 November 2017.
According to the information provided by the Ministry, Argentina sent the note required by Article 14 of the Agreement (signed on 23 December 2016), completing the requirements established for its entrance into force.
I. Exchange of Tax Information
The Agreement sets forth mechanisms for upon request, automatic and spontaneous exchanges of tax information between Argentina and the United States, being applicable to all matters related to any kind of federal taxes established by both countries.
Notwithstanding the above, the request can be denied when the applicant party would not be able to obtain under its own laws for purposes of the administration or enforcement of its own tax laws, the request is not made in conformity with the Agreement or when the applicant party has not pursued all means available in its own territory to obtain the information.
II. Exchange of Information Upon Request
The Agreement requires a justified cause and a defined purpose for a request of information.
In this regard, the Agreement establishes that when the exchange is made upon request, the interested party will have to send a request indicating with the greatest level of detail the following information: (i) identity of the person under investigation, (ii) a statement of the information sought, (iii) fiscal years, (iv) tax matter to which it relates, (v) grounds for the request, (vi) name and address of the person or entity believed to be in possession of the information (if known) and (vii) a statement that the request is in conformity with the law of the applicant Party, and that such Party has pursued all means available in its own territory to obtain the information.
In the same sense, the Agreement establishes that the parties must have the capacity to obtain and provide information held by banks and information related to the ownership of companies, trusts and foundations, including information about the entities that conform the chain ownership.
The party that receives the request will have 90 days to obtain and provide the information, having the obligation of notifying any deficiencies within 60 days of the receipt of the request.
III. Automatic and spontaneous exchange of information
The Agreement subjects the automatic and the spontaneous exchange of information to the execution of additional agreements that regulate such possibilities.
IV. Entry into Force
The Agreement shall have effects for requests made on or after 13 November 2017, concerning information for taxes relating to taxable periods beginning or charges to tax arising on or after 1 January 2018, or, where there is no taxable period, for all on or after 1 January 2018.
It should be noted that the Agreement can not be characterized as a Double Taxation Treaty.