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LAW OF UKRAINE

of March 20, 2023 No. 2970-IX

About introduction of amendments to the Tax Code of Ukraine and other legal acts of Ukraine concerning implementation of the international standard of automatic exchange of information about financial accounts

The Verkhovna Rada of Ukraine DECIDES:

I. Bring in the Tax code of Ukraine (Sheets of the Verkhovna Rada of Ukraine, 2011, Art. No. No. 13-17, 112) the following changes:

1. In Article 14:

1) in Item 14.1:

add with subitems 14.1.10 1 - 14.1.10 3, 14.1.59 of 1 following content:

"14.1.10 1. The multilateral agreement CRS - the multilateral agreement of competent authorities about automatic exchange of information about financial accounts (Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information (MCAA CRS) signed according to article 6 of the Convention on the mutual administrative aid in tax cases;

14.1.10 2. The multilateral agreement CbC (for the purposes of article 39 of this Code) - the multilateral agreement of competent authorities about automatic exchange of reports by the countries (Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports) signed according to article 6 of the Convention on the mutual administrative aid in tax cases;

14.1.10 3. The agreement of QCAA (for the purposes of article 39 of this Code) - the agreement signed between the competent authorities of Ukraine and foreign jurisdiction which are the parties of the existing international treaty containing the regulations on exchange of information for the tax purposes providing automatic exchange of reports by the countries of the international group of companies between Ukraine and such foreign jurisdiction (Qualifying Competent Authority Agreement) including the multilateral agreement CbC";

"14.1.59 1. The general standard of the reporting of CRS - the general standard of the reporting and proper verification of information on financial accounts which includes comments to it (Common Standard on Reporting and Due Diligence for Financial Account Information (CRS) approved by Council of Organization for Economic Cooperation and Development on July 15, 2014 (with changes and amendments)";

state subitems 14.1.103-1 and 14.1.113-3 in the following edition:

"14.1.103 1. mother company of the international group of companies (for the purposes of article 39 of this Code) - the member of the international group of companies who at the same time answers the following criteria:

directly or indirectly owns corporate laws of other members of the international group of companies (or actually controls such participants), and the share of such ownership is sufficient for inclusion of the financial reporting of such other members of the international group of companies in consolidated financial statements of such international group of companies according to international accounting standards or other international and acknowledged accounting standards, or preparation of consolidated financial statements would be obligatory for such company if shares (corporate laws) of one of members of the relevant international group of companies would be in circulation in the national and/or foreign organized stock market (stock exchange);

the financial reporting of such participant is not subject to inclusion in the consolidated statements of any of other members of the international group of companies according to international accounting standards or other international acknowledged accounting standards";

"14.1.113 3. the international group of companies (for the purposes of article 39 of this Code) - two or more legal entities or educations without the status of the legal entity who are tax residents of different jurisdictions (the states, the territories) (in particular if at least one of such persons is tax resident of one foreign jurisdiction (the state, the territory) which performs economic activity through permanent mission in other jurisdiction (the state, the territory) and are connected among themselves by criteria of ownership or control in such a way that according to international accounting standards or other international and acknowledged accounting standards preparation of consolidated financial statements is obligatory or preparation of consolidated financial statements would be obligatory in case, if shares (corporate laws) of one of such members of the international group of companies were in circulation in the national and/or foreign organized stock market (stock exchange)";

in subitem 14.1.122:

in the subitem "an" of the word "foreign companies, organizations" shall be replaced with words "the foreign companies, the organizations, partnership and other associations of persons", and words "divisions with the location in the territory of Ukraine" - words "divisions with the location in the territory of Ukraine, and also the legal educations without the status of the legal entity created according to the legislation of foreign states or the territories which are not residents of Ukraine, according to provisions of this Code";

in paragraph five of the word "controller of the owner of the financial account" shall be replaced with words "the controlling face of the account holder";

add with subitem 14.1.141-2 of the following content:

"14.1.141-2. partnership - the consolidation of two or more persons created according to the legislation of foreign jurisdiction on the basis or according to the agreement for conducting activities for the purpose of profit earning or achievement of other common goal";

state subitem 14.1.146-1 in the following edition:

"14.1.146-1. the accountable account - the financial account which corresponds to determination of the term "American accountable account" according to the agreement of FATCA and/or is determined as the accountable account according to rules of the general standard of the reporting of CRS for the purposes of the multilateral agreement CRS";

state subitem 14.1.158-1 in the following edition:

"14.1.158-1. the tax notification to nonresident person - the notification which is provided to the nonresident and includes:

1) the tax notification to nonresident person registered as the taxpayer on value added - the notification electronically directed by the central executive body realizing the state tax policy about obligation of nonresident person to pay the monetary commitment amount on the value added tax determined according to this Code;

2) the tax notification to nonresident person who is not registered as the taxpayer on value added - the written notice of obligation of nonresident person to be registered as the taxpayer on value added according to Article 208 1 of this Code which goes the central executive body realizing the state tax policy to competent authority of foreign state for informing nonresident person;

3) the tax notification to person - the nonresident about violation of requirements the CRS written notice of obligation of nonresident person to pay the amount of monetary commitment and/or to fulfill other requirements of Article 39-3 of this Code in the part concerning accomplishment of the multilateral agreement CRS and the general standard of the reporting of CRS";

exclude subitem 14.1.158-2;

add with subitem 14.1.172-2 of the following content:

"14.1.172-2. The agreement of FATCA agreement between the government of Ukraine and the Government of the United States of America for improvement of accomplishment of tax rules and application of provisions of the Law of the USA "About the tax claims to foreign accounts of" (FATCA)";

state subitem 14.1.254-1 in the following edition:

"14.1.254-1. the authorized participant (for the purposes of article 39 of this Code) - the member of the international group of companies authorized by such international group of companies on preparation and submission of the report by the countries of the international group of companies on behalf of such international group of companies in tax authority of jurisdiction (the state, the territory) in which such participant is registered or in which its activities cause formation of permanent mission";

add with subitem 14.1.254-2 of the following content:

"14.1.254-2. the member of the international group of companies (for the purposes of article 39 of this Code):

a) any separate economic unit of the international group of companies (in particular the Ukrainian or foreign legal entity or education without the status of the legal entity) which is included in consolidated financial statements of such international group of companies for the purposes of such reporting or which shall be included in consolidated financial statements if shares (corporate laws) of such separate economic unit of the international group of companies would be in circulation in the national and/or foreign organized stock market (stock exchange);

b) any such economic unit of the international group of companies excluded from consolidated financial statements of such international group of companies according to the criteria determined for the purposes of creation of the specified reporting (concerning ownership or control between legal entities or education without the status of the legal entity, materiality of such economic unit for the international group of companies, etc.);

c) any permanent mission of any economic unit of the international group of companies specified in subitems "an" and "b" of this subitem provided that such economic unit constitutes separate financial statements concerning such permanent mission for the financial, regulatory or tax purposes or for the purposes of internal managerial supervision";

state subitems 14.1.257-1 and 14.1.258-1 in the following edition:

"14.1.257-1. the financial agent - any person (except physical person) who corresponds to determination of reporting financial institution of Ukraine, in the value given in the agreement of FATCA, and/or accountable financial institution according to the multilateral agreement CRS and the general standard of the reporting of CRS and which according to this Code and other acts of the legislation adopted in pursuance of provisions of the Agreement FATCA and the multilateral agreement CRS shall apply measures of proper complex check to financial accounts submit the report on accountable accounts to monitoring body, carry out other obligations and bear responsibility for violation of these obligations according to the procedure, established by the law.

Regulators of the markets of financial services within the powers determined by legal acts in the field of regulation of activities for provision of financial services establish lists of non-bank financial institutions which shall fulfill duties of financial agents according to requirements of the Agreement of FATCA.

For the purpose of fulfillment of requirements of the Agreement of FATCA FATCA determined in Appendix II to the Agreement are not financial agents of person.

For the purposes of the multilateral agreement CRS of person which shall carry out obligations of financial agents (are accountable financial institutions), are determined according to rules of the specified agreement, the general standard of the reporting of CRS and regulatory legal acts of the central executive body providing forming and realizes the state financial policy, for implementation of the multilateral agreement CRS";

"14.1.258-1. the financial account - the account opened by the financial agent or the agreement signed by the financial agent.

For the purposes of of this Code financial accounts include bank accounts, payment accounts, security accounts, other account types, contracts which correspond to the criteria determined by the agreement of FATCA and/or the multilateral agreement CRS. For the purposes of the multilateral agreement CRS the term" the financial account" is applied and interpreted according to provisions of the general standard of the reporting of CRS";

To add 2) with Item 14.4 of the following content:

"14.4. For the purposes of of this Code if he directly does not provide other, the international agreements containing regulations on exchange of information for the tax purposes include the Convention on the mutual administrative aid in tax cases, the international treaty of Ukraine on avoidance of double taxation and other international agreements on exchange of information for the tax purposes which consent to be bound is provided by the Verkhovna Rada of Ukraine, and also the interdepartmental agreements signed on their basis".

2. To add Item 19-1.1 of Article 19 1 with subitem 19-1.1.32-1 of the following content:

"19-1.1.32-1. will organize interaction and exchange of information with regulators of the markets of financial services, certain laws of Ukraine in the field of regulation of activities for provision of financial services, for the purpose of control of accomplishment by financial agents of requirements of Article 39-3 of this Code and ensuring agreement performance of FATCA and the multilateral agreement CRS".

3. To add Item 20.1 of Article 20 with subitem 20.1.5-1 of the following content:

"20.1.5-1. obtain free of charge from financial agents information and documents in amounts, according to the procedure and on the bases determined by this Code taking into account the laws determining procedure for disclosure of information with limited access".

4. In Article 39:

1) in Item 39.4:

in subitem 39.4.2:

in paragraph one of the word "and message on participation in the international group of companies" to exclude;

after paragraph one to add with the new paragraph of the following content:

"Taxpayers who are members of the relevant international group of companies and in reporting year performed controlled transactions, shall give till October 1 of the year following for reporting, the notification on participation in the international group of companies".

With respect thereto to consider paragraph two the paragraph third;

state subitem 39.4.2.2 in the following edition:

"39.4.2.2. The notification on participation in the international group of companies shall contain, in particular, the following information:

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