Additional Statement to Modify Certain Parts of the Statement of MutualCooperation and Understanding between the U.S. Department of theTreasury and the Authorities of Japan to Improve International Tax
Compliance and to Facilitate Implementation of FATCA
Whereas, the United States of America (“United States”) and Japan exchanged
notes related to a nonbinding Statement of Mutual Cooperation and Understanding
between the U.S. Department of the Treasury and the Authorities of Japan toImprove International Tax Compliance and to Facilitate Implementation ofFATCA (hereinafter referred to as “the Statement”) on June 10, 2013;
Whereas, the U.S. Department of the Treasury and the Authorities of Japan as
defined in subparagraph 1(e) of Section 1 of the Statement (each, a “Participant”)
desire to implement the arrangement in the Statement, which provides forcooperation to facilitate the implementation of FATCA based on direct reportingby Japanese financial institutions to the U.S. Internal Revenue Service,supplemented by the exchange of information upon request pursuant to theConvention Between the Government of the United States of America and theGovernment of Japan for the Avoidance of Double Taxation and the Prevention ofFiscal Evasion With Respect to Taxes on Income, signed on November 6, 2003, atWashington, DC (the “Convention”) and subject to the confidentiality and otherprotections provided for therein, including the provisions limiting the use of theinformation exchanged under the Convention;
Whereas Section 6 of the Statement provides that “the Authorities of Japan andJapanese Financial Institutions should be granted the benefit of any more favorable
treatment under Section 3 or Annex I of the Statement relating to the application ofFATCA to Japanese Financial Institutions afforded to another Partner Jurisdiction
under a bilateral arrangement or agreement pursuant to which the other Partner
Jurisdiction implements the same duties as the Authorities of Japan and Japanese
Financial Institutions described in Section 2 of the Statement consistently with thesame terms and conditions as described therein and in Sections 4, 6, 8, and 9 of theStatement;”
Whereas at least one Partner Jurisdiction has signed a bilateral intergovernmental
agreement with the United States that, once in force, would obligate such Partner
Jurisdiction to perform the same duties as the Authorities of Japan and Japanese
Financial Institutions have assumed as described in Section 2 of the Statement
consistently with the same terms and conditions as described therein and inSections 4, 6, 8, and 9 of the Statement (hereinafter referred to as a “Section 6
Consistent Intergovernmental Agreement”);
Whereas the Participants intend to modify certain parts of the Statement; andNow, therefore, the Participants confirm the following:
1. All references in the Statement, including its Annexes, to “December 31,2013” should be deleted and replaced with “June 30, 2014”.
2. All references in the Statement, including its Annexes, to “January 1, 2014”
should be deleted and replaced with “July 1, 2014”.
3. The references to “December 31, 2015” in subparagraph C (1) of Section IIof Annex I and in subparagraph E(1) of Section IV of Annex I should bedeleted and replaced with “June 30, 2016”.
4. Subparagraph E(1) of Section II of Annex I should be deleted and replacedwith “If a Preexisting Individual Account is a High Value Account as ofJune 30, 2014, the Reporting Japanese Financial Institution must complete
the enhanced review procedures described in paragraph D of this sectionwith respect to such account by June 30, 2015. If, based on this review suchaccount is identified as a U.S. Account on or before December 31, 2014, theReporting Japanese Financial Institution must report the required
information about such account with respect to 2014 in the first report on theaccount, and on an annual basis thereafter. In the case of an accountidentified as a U.S. Account after December 31, 2014 and on or before June30, 2015, the Reporting Japanese Financial Institution is not required toreport information about such account with respect to 2014, but must report
information about the account on an annual basis thereafter.”.
5. The first sentence in paragraph B of Section IV of Annex I should bedeleted and replaced with “A Preexisting Entity Account that has an accountbalance or value that exceeds $250,000 as of June 30, 2014, and aPreexisting Entity Account that does not exceed $250,000 as of June 30,
2014 but the account balance or value of which exceeds $1,000,000 as of thelast day of 2015 or any subsequent calendar year, must be reviewed inaccordance with the procedures set forth in paragraph D of this section.”.

6. Subparagraph B(4)(b) of Section VI of Annex I should be deleted andreplaced with “The stock of the NFFE is regularly traded on an establishedsecurities market or the NFFE is a Related Entity of an Entity the stock ofwhich is regularly traded on an established securities market. For purposesof this Statement, interests are “regularly traded” if there is a meaningful
volume of trading with respect to the interests on an ongoing basis, and an“established securities market” means an exchange that is officiallyrecognized and supervised by a governmental authority of a country inwhich the market is located and that has a meaningful annual value of shares
traded on the exchange;”.
7. Subparagraph 1(bb) of Section 1 of the Statement should be deleted andreplaced with “The term “Specified U.S. Person” means a U.S. Person, otherthan: (i) a corporation the stock of which is regularly traded on one or moreestablished securities markets; (ii) any corporation that is a member of thesame expanded affiliated group, as defined in section 1471(e)(2) of the U.S.
Internal Revenue Code, as a corporation described in clause (i); (iii) theUnited States or any wholly owned agency or instrumentality thereof; (iv)any State of the United States, any U.S. Territory, any political subdivisionof any of the foregoing, or any wholly owned agency or instrumentality of
any one or more of the foregoing; (v) any organization exempt from taxation
under section 501(a) of the U.S. Internal Revenue Code or an individual
retirement plan as defined in section 7701(a)(37) of the U.S. Internal
Revenue Code; (vi) any bank as defined in section 581 of the U.S. Internal
Revenue Code; (vii) any real estate investment trust as defined in section
856 of the U.S. Internal Revenue Code; (viii) any regulated investmentcompany as defined in section 851 of the U.S. Internal Revenue Code or anyentity registered with the U.S. Securities and Exchange Commission underthe Investment Company Act of 1940 (15 U.S.C. 80a-64); (ix) any common
trust fund as defined in section 584(a) of the U.S. Internal Revenue Code;(x) any trust that is exempt from tax under section 664(c) of the U.S. Internal
Revenue Code or that is described in section 4947(a)(1) of the U.S. Internal
Revenue Code; (xi) a dealer in securities, commodities, or derivative
financial instruments (including notional principal contracts, futures,forwards, and options) that is registered as such under the laws of the UnitedStates or any State; (xii) a broker as defined in section 6045(c) of the U.S.
Internal Revenue Code ; or (xiii) any tax-exempt trust under a plan that isdescribed in section 403(b) or section 457(g) of the U.S. Internal RevenueCode.”.

8. The first clause in paragraph 5 of Section 3 of the Statement should bedeleted and replaced with “If a Japanese Financial Institution, that otherwise
meets the conditions described in Section 2 of this Statement or is describedin paragraph 3 or 4 of this Section, has a Related Entity or branch thatoperates in a jurisdiction that prevents such Related Entity or branch from
fulfilling the requirements of a participating FFI or deemed-compliant FFI
for purposes of section 1471 of the U.S. Internal Revenue Code or has aRelated Entity or branch that is treated as a Nonparticipating Financial
Institution solely due to the expiration of the transitional rule for limited
FFIs and limited branches under relevant U.S. Treasury Regulations, such
Japanese Financial Institution should continue to be treated as a participating
FFI, deemed-compliant FFI, or exempt beneficial owner, as appropriate, forpurposes of section 1471 of the U.S. Internal Revenue Code, provided that:”.
9. Consistent with the mutual understanding expressed in Section 6 of theStatement, the United States intends to grant the Authorities of Japan andJapanese Financial Institutions the benefit of any more favorable treatment
under Section 3 or Annex I of the Statement relating to the application ofFATCA to Japanese Financial Institutions afforded to a Partner Jurisdiction
through a Section 6 Consistent Intergovernmental Agreement.