TREATIES AND OTHER INTERNATIONAL ACTS SERIES 06-330 

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TAXATION 

Information Exchange 

 Agreement between 

the UNITED STATES OF AMERICA 

and GUERNSEY 

Signed at Washington September 19, 2002 

 

 
 NOTE BY THE DEPARTMENT OF STATE 

 Pursuant to Public Law 89—497, approved July 8, 1966 

(80 Stat. 271; 1 U.S.C. 113)—

“. . .the Treaties and Other International Acts Series issued 

under the authority of the Secretary of State shall be competent 

 evidence . . . of the treaties, international agreements other than 

treaties, and proclamations by the President of such treaties and 

international agreements other than treaties, as the case may be, 

therein contained, in all the courts of law and equity and of maritime 

jurisdiction, and in all the tribunals and public offices of the 

United States, and of the several States, without any further proof 

or authentication thereof.” 
GUERNSEY 

Taxation: Information Exchange 

 Agreement signed at Washington September 19, 2002; 

 Entered into force March 30, 2006. 

 
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AGREEMENT BETWEEN THE GOVERNMENT OF THE

UNITED STATES OF AMERICA AND THE

GOVERNMENT OF THE STATES OF GUERNSEY

FOR THE EXCHANGE OF INFORMATION RELATING TO TAXES

Whereas Guernsey has long been active in international efforts in the fight against financial and

other crimes, including recent efforts involving terrorist financing;

Whereas the Internal Revenue Service of the United States has determined Guernsey's "know

your customer" rules to be acceptable for purposes of the Qualified Intermediary regime, which

provides simplified withholding and reporting obligations for payments of income from the

United States to an account holder through one or more foreign intermediaries;

Whereas the Government of the United States and the Government of the States of Guernsey

("the parties") recognise that present legislation already provides for the exchange of

information in criminal tax matters, which under current practice is conducted by the United

States through the Department of Justice and by Guernsey through its Attorney General;

Whereas the parties wish to establish the terms and conditions governing the exchange of

information relating to taxes;

Now, therefore, the parties have agreed as follows:
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ARTICLE 1

SCOPE OF THE AGREEMENT

The parties shall provide assistance through exchange of information that is foreseeably

relevant to the administration and enforcement of the domestic laws of the parties concerning

the taxes covered by this Agreement, including information that is foreseeably relevant to the

determination, assessment, enforcement or collection of tax with respect to persons subject to

such taxes, or to the investigation or prosecution of criminal matters in relation to such persons.

ARTICLE 2

JURISDICTION

To enable the scope of this Agreement to be implemented, information shall be

provided in accordance with this Agreement by the competent authority of the requested party

without regard to whether the person to whom the information relates is, or whether the

information is held by, a resident of a party. A requested party is not obliged to provide

information which is neither held by its authorities nor in the possession of persons who are

within its territorial jurisdiction.

ARTICLE 3

TAXES COVERED

1. This Agreement shall apply to the following taxes imposed by the parties:

(a) in the case of the United States, all federal taxes,

(b) in the case of Guernsey, all insular taxes.

2. This Agreement shall apply also to any identical or substantially similar taxes

imposed after the date of signature of the Agreement in addition to or in place of the existing

taxes if the parties so agree. The competent authority of each party shall notify the other of

changes in laws which may affect the obligations of that party pursuant to this Agreement.

3. This Agreement shall not apply to the extent that an action or proceeding

concerning taxes covered by this Agreement is barred by the requesting party's statute of

limitations.
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4. This Agreement shall not apply to taxes imposed by states, municipalities or

other political subdivisions, or possessions of a party.

ARTICLE 4

DEFINITIONS

1. In this Agreement:

"competent authority" means, for the United States, the Secretary of the Treasury or his

delegate,

and for Guernsey, the Administrator of Income Tax or his delegate, except that until a date not

later than January 1, 2006, Her Majesty's Attorney General for Guernsey may act as the

competent authority in respect of criminal tax matters;

"criminal laws" means all criminal laws designated as such under domestic law, irrespective of

whether contained in the tax laws, the criminal code or other statutes;

"criminal tax matters" means tax matters involving intentional conduct which is liable to

prosecution under the criminal laws of the requesting party;

"information gathering measures" means judicial, regulatory, criminal or administrative

procedures enabling a requested party to obtain and provide the information requested;

"information" means any fact, statement, document or record in whatever form;

"person" means a natural person, a company or any other body or group of persons;

"requested party" means the party to this Agreement which is requested to provide or has

provided information in response to a request;

"requesting party" means the party to this Agreement submitting a request for or having

received information from the requested party;

"resident" means:

(a) in the case of the United States, any United States citizen and any legal person,

partnership, corporation, trust, estate, association, or other entity deriving its

status as such from the laws in force in the United States; and

(b) in the case of Guernsey, any person resident in Guernsey, for the purposes of the

Income Tax (Guernsey) Law 1975, as amended.
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"tax" means any tax covered by this Agreement.

2. For purposes of determining the geographical area within which jurisdiction to

compel production of information may be exercised, the term "United States" means the United

States of America, including Puerto Rico, the Virgin Islands, Guam, and any other United

States possession or territory.

For purposes of determining the geographical area within which jurisdiction to compel

production of information may be exercised, the term "Guernsey" means Guernsey, Alderney

and Herm.

3. Any term not defined in this Agreement, unless the context otherwise requires or

the competent authorities agree to a common meaning pursuant to the provisions of Article 10,

shall have the meaning which it has under the laws of the parties relating to the taxes which are

the subject of this Agreement.

ARTICLE 5

EXCHANGE OF INFORMATION UPON REQUEST

1. The competent authority of the requested party shall provide upon request by the

requesting party information for the purposes referred to in Article 1. Such information shall be

exchanged without regard to whether the requested party needs such information for its own tax

purposes or the conduct being investigated would constitute a crime under the laws of the

requested party if it had occurred in the territory of the requested party. The competent

authority of the requesting party shall only make a request for information pursuant to this

Article when it is unable to obtain the requested information by other means, except where

recourse to such means would give rise to disproportionate difficulty.

2. If the information in the possession of the competent authority of the requested

party is not sufficient to enable it to comply with the request for information, the requested

party shall take all relevant information gathering measures to provide the requesting party with

the information requested, notwithstanding that the requested party may not, at that time, need

such information for its own tax purposes.
3. If specifically requested by the competent authority of the requesting party, the

competent authority of the requested party shall provide information under this Article, to the

extent allowable under its domestic laws, in the form of depositions of witnesses and

authenticated copies of original records.

4. Each party shall ensure that it has the authority, for the purposes referred to in

Article 1 of this Agreement and subject to Article 2 of this Agreement, to obtain and provide,

through its competent authority and upon request:

(a) information held by banks, other financial institutions, and any person, including

nominees and trustees, acting in an agency or fiduciary capacity;

(b) information regarding the beneficial ownership of companies, partnerships and

other persons, including in the case of collective investment funds, information

on shares, units and other interests; and in the case of trusts, information on

settlors, trustees and beneficiaries, provided that this Agreement does not create

an obligation for a party to obtain or provide ownership information with respect

to publicly traded companies or public collective investment funds, unless such

information can be obtained without giving rise to disproportionate difficulties.

5. Any request for information made by a party shall be framed with the greatest

degree of specificity possible. In all cases, such requests shall specify in writing the following:

(a) the identity of the taxpayer under examination or investigation;

(b) the period of time with respect to which the information is requested;

(c) the nature of the information requested and the form in which the requesting

party would prefer to receive it;

(d) the matter under the requesting party's tax law with respect to which the

information is sought;

(e) the reasons for believing that the information requested is foreseeably relevant

or material to tax administration and enforcement of the requesting party, with

respect to the person identified in subparagraph (a) of this paragraph;
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(f) reasonable grounds for believing that the information requested is present in the

requested party or is in the possession of a person within the jurisdiction of the

requested party;

(g) to the extent known, the name and address of any person believed to be in

possession or control of the information requested;

(h) a statement that the request conforms to the law and administrative practice of

the requesting party and would be obtainable by the requesting party under its

laws or in the normal course of administrative practice in similar circumstances,

both for its own tax purposes and in response to a valid request from the

requested party under this Agreement;

(i) a statement that the requesting party has pursued all reasonable means available

in its own territory to obtain the information, except where that would give rise

to disproportionate difficulty.

ARTICLE 6

TAX INVESTIGATIONS ABROAD

1. By reasonable notice given in advance, a party may request that the other party

allow officials of the requesting party to enter the territory of the requested party, to the extent

permitted under its domestic laws, to interview individuals and examine records with the prior

written consent of the individuals concerned. The competent authority of the requesting party

shall notify the competent authority of the requested party of the time and place of the intended

meeting with the individuals concerned.

2. At the request of the competent authority of the requesting party, the competent

authority of the requested party may permit representatives of the competent authority of the

requesting party to attend a tax examination in the territory of the requested party.

3. If the request referred to in paragraph 2 is granted, the competent authority of

the requested party conducting the examination shall, as soon as possible, notify the competent

authority of the requesting party of the time and place of the examination, the authority or

person authorised to carry out the examination and the procedures and conditions required by
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the requested party for the conduct of the examination. All decisions regarding the conduct of

the examination shall be made by the requested party conducting the examination.

ARTICLE 7

POSSIBILITY OF DECLINING A REQUEST

1. The competent authority of the requested party may decline to assist:

(a) where the request is not made in conformity with this Agreement;

(b) where the requesting party has not pursued all means available in its own

territory to obtain the information, except where recourse to such means would

give rise to disproportionate difficulty; or

(c) where the disclosure of the information requested would be contrary to the

public policy of the requested party.

2. This Agreement shall not impose upon a party any obligation:

(a) to provide items subject to legal privilege, nor any trade, business, industrial,

commercial or professional secret or trade process, provided that information

described in Article 5(4) shall not by reason of that fact alone be treated as such

a secret or trade process; or

(b) to carry out administrative measures at variance with its laws and administrative

practices, provided that nothing in this subparagraph shall affect the obligations

of a party under Article 5(4).

3. A request for information shall not be refused on the ground that the tax liability

giving rise to the request is disputed by the taxpayer.

4. The requested party shall not be required to obtain and provide information

which the requesting party would be unable to obtain in similar circumstances under its own

laws for the purpose of the administration/enforcement of its own tax laws or in response to a

valid request from the requested party under this Agreement.

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ARTICLE 8

CONFIDENTIALITY

1. All information provided and received by the competent authorities of the

parties shall be kept confidential.

2. Information provided to the competent authority of a requesting party may not

be used for any purpose other than for the purposes stated in Article 1, without the prior express

written consent of the requested party.

3. Information provided shall be disclosed only to persons or authorities (including

judicial, administrative and Congressional oversight authorities) officially concerned with the

purposes specified in Article 1, and used by such persons or authorities only for such purposes

or for oversight purposes, including the determination of any appeal. For these purposes,

information may be disclosed in public court proceedings or in judicial proceedings.

4. Information provided to a requesting party under this Agreement may not be

disclosed to any third party, including an agency or employee of any other government.

ARTICLE 9

COSTS

The requesting party shall reimburse the requested party for all direct costs incurred in

providing information pursuant to this Agreement. The respective competent authorities shall

consult from time to time with regard to this Article, and in particular the competent authority

of the requested party shall consult with the competent authority of the requesting party if the

costs of providing information with respect to a specific request are expected to be significant.

ARTICLE 10

MUTUAL AGREEMENT PROCEDURE

Where difficulties or doubts arise between the parties regarding the implementation or

interpretation of this Agreement, the respective competent authorities shall use their best efforts

to resolve the matter by mutual agreement.
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ARTICLE 11

MUTUAL ASSISTANCE PROCEDURE

If both competent authorities of the parties consider it appropriate to do so they may

agree to exchange technical know-how, develop new audit techniques, identify new areas of

non-compliance, and jointly study non-compliance areas.

ARTICLE 12

ENTRY INTO FORCE

This Agreement shall enter into force when each party has notified the other of the

completion of its necessary internal procedures for entry into force. Upon entry into force, it

shall have effect for criminal tax matters forthwith and, in respect of other matters covered in

Article 1, on January 1, 2006, or such earlier date as may be agreed in an exchange of letters by

the competent authorities.

ARTICLE 13

TERMINATION

1. This Agreement shall remain in force until terminated by either party.

2. Either party may terminate this Agreement by giving notice of termination in

writing. Such termination shall become effective on the first day of the month following the

expiration of a period of three months after the date of receipt of notice of termination by the

other party.

3. A party which terminates this Agreement shall remain bound by the provisions

of Article 8 with respect to any information obtained under this Agreement.
IN WITNESS WHEREOF the undersigned being duly authorised in that behalf by the

respective parties, have signed the Agreement.

DONE at Washington in duplicate this nineteenth day of September, 2002.

FOR THE GOVERNMENT OF THE FOR THE GOVERNMENT OF THE

UNITED STATES OF AMERICA: STATES OF GUERNSEY:

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