All the papers are ready and the governments have already been diplomatically notified. The automatic financial exchange agreement with the United States will enter into force on January 1 and the first wave of data on undeclared Argentine accounts in that country will arrive in September 2024.
The information was confirmed to THE NATION by the Embassy of the United States in the country and by sources from the Ministry of Economy. Despite the signing of the agreement weeks ago, steps were still missing and the alerts were on. If these procedures were not completed and on January 1st the IGA 1A (for Intergovernmental Agreement in English) was not fully in force, the first information package from the northern country would not have arrived until the end of 2025.
As specified by the United States Department of the Treasury when it published the signed IGA 1A -along with a specific memorandum for banks- on its website, in the ninth month (September 2024) An information package will arrive that will only contain the identification of account holders (a natural person), financial institutions, gross amounts of interest, dividends and other income -balances will not be specified- from an American source received by Argentine residents and deposited in American accounts .
On December 22, through general resolution 5303/22, the AFIP led by Carlos Castagneto adapted the rules that Argentine financial entities must comply with when collecting the necessary information for the Argentine collecting entity to exchange with the IRS (Internal Revenue Service). On the other hand, in the Ministry of Economy they affirmed during those same days that the publication of the IGA 1A on the part of the North American Department of the Treasury already worked as a notification to the Congress (it does not require approval of the Senate, like other treaties). But Not only were those steps missing, but also the notifications that those procedures had been completed through diplomatic notes. That was concluded. As previously reported, the lack of translations – they were being done – was not an obstacle.
“The IGA will enter into force on January 1”, confirmed the press office of the Embassy of the United States to this outlet. This implies, according to the letter of the signed text, that the first exchange will be in September 2024.
The Foreign Account Tax Compliance Act (Fatca) was signed in 2010, but entered into force in 2014. The United States already has agreements within the framework of this information exchange law with 114 countries, counting the one sealed with Argentina at the beginning of this month. However, there are complaints in Europe regarding the lack of information sent by that country, as well as statements by US officials and experts that suggest that neither the states nor the federal government currently have the number of personnel necessary to send such a wealth of information.
This agreement is universal – more precisely, standard – and does not include particularities by country, not even in the Argentine case. It is reciprocal and also it is not retroactive (it will not include the information of 2022). However, with respect to this last point, some tax experts and tax lawyers recall that the Tax Information Exchange Agreements signed in December 2016. This is the previous and required step for an IGA 1A. It is the bilateral agreement by which Argentina might request information from the United States, but on a case-by-case basis.
Months ago, no one seriously believed that the US might close an IGA 1A with the current government. That achievement was a victory for Sergio Massa. Weeks ago, it was even doubted that the agreement had actually been signed. Despite this achievement, the scope of the agreement is limited both temporarily and practically. It will only include information from form 1042-s (informative return submitted by financial institutions to the IRS and in which the North American source income received by non-residents is declared) and nothing from the W8.
All North American states, as with any federal country, are included in the agreement. Only American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the US Virgin Islands are excluded, because they do not have the same relationship as the other 50 states to the IRS. Those citizens do not pay Earnings in the United States. The computer safeguards for the IGA 1A to enter into force were complied with by the AFIP following a US visit in 2019.
The Ministry of Economy thought to have a laundering approved by Congress before the end of the year, but the political short circuits between the ruling party and the opposition in the Chamber of Deputies following the Kirchnerism maneuvers following a Supreme Court ruling on the Council of the Magistracy muddied the possibility of moving forward with the initiative. In fact, legislative sources said that the project had not yet entered Parliament.
On the other hand, the president of the National Securities Commission (CNV), Sebastián Negri, signed with the head of the Superintendence of Financial Services (SSF) of the Central Bank of Uruguay (BCU), Juan Pedro Cantera, an agreement for mutual cooperation, consultations and exchange of financial information.
The text complements the Multilateral Agreement of Understanding on Consultation, Cooperation and Exchange of Information of the International Organization of Securities Commissions (Iosco), the CNV reported in a statement.
“The agreement is part of the policy of the Ministry of Economy to reach agreements that allow access to relevant information on Argentine companies or individuals abroad to fulfill our functions of regulation, supervision, control and promotion of fair, efficient and transparent securities markets. , protecting investors and reducing systemic risk”, Negri stressed.
“The initiative will offer a tool that will allow quick access to information on cross-border operations related to registration, registration or authorization processes of companies and individuals to act in the securities markets,” the CNV statement added. .