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Agreement between the Government of the United States of America and the Government 

of the Republic of Malta to Improve International Tax Compliance and to Implement 

FATCA

Whereas, the Government of the United States of America and the Government of the Republic 

of Malta (each, a “Party,” and together, the “Parties”) desire to conclude an agreement to 

improve international tax compliance through mutual assistance in tax matters based on an 

effective infrastructure for the automatic exchange of information;

Whereas, Article 26 of the Convention between the Government of the United States of America 

and the Government of Malta for the Avoidance of Double Taxation and the Prevention of Fiscal 

Evasion with Respect to Taxes on Income, done at Valletta on August 8, 2008 (“the 

Convention”), authorises the exchange of information for tax purposes, including on an 

automatic basis;

Whereas, the United States of America enacted provisions commonly known as the Foreign 

Account Tax Compliance Act (“FATCA”), which introduce a reporting regime for financial 

institutions with respect to certain accounts; 

Whereas, the Government of the Republic of Malta is supportive of the underlying policy goal of 

FATCA to improve tax compliance; 

Whereas, FATCA has raised a number of issues, including that Malta financial institutions may 

not be able to comply with certain aspects of FATCA due to domestic legal impediments;

Whereas, the Government of the United States of America collects information regarding certain 

accounts maintained by U.S. financial institutions held by Malta residents and is committed to 

exchanging such information with the Government of the Republic of Malta and pursuing 

equivalent levels of exchange, provided that the appropriate safeguards and infrastructure for an 

effective exchange relationship are in place;

Whereas, the Parties are committed to working together over the longer term towards achieving 

common reporting and due diligence standards for financial institutions;

Whereas, the Government of the United States of America acknowledges the need to coordinate 

the reporting obligations under FATCA with other U.S. tax reporting obligations of Malta 

financial institutions to avoid duplicative reporting;

Whereas, an intergovernmental approach to FATCA implementation would address legal 

impediments and reduce burdens for Malta financial institutions;

Whereas, the Parties desire to conclude an agreement to improve international tax compliance 

and provide for the implementation of FATCA based on domestic reporting and reciprocal 

automatic exchange pursuant to the Convention and subject to the confidentiality and other 
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protections provided for therein, including the provisions limiting the use of the information 

exchanged under the Convention;

Now, therefore, the Parties have agreed as follows:

ARTICLE 1

Definitions

1. For purposes of this agreement and any annexes thereto (“Agreement”), the following 

terms shall have the meanings set forth below:

a) The term “United States” means the United States of America, including the 

States thereof, and, when used in a geographical sense, means the land territory of 

the United States of America, including inland waters, and the air space, the 

territorial sea thereof and any maritime area beyond the territorial sea within 

which the United States of America may exercise sovereign rights or jurisdiction 

in accordance with international law; the term, however, does not include the U.S. 

Territories. Any reference to a “State” of the United States includes the District of 

Columbia.

b) The term “U.S. Territory” means American Samoa, the Commonwealth of the 

Northern Mariana Islands, Guam, the Commonwealth of Puerto Rico, or the U.S. 

Virgin Islands.

c) The term “IRS” means the U.S. Internal Revenue Service.

d) The term “Malta” means the Republic of Malta and, when used in a geographical 

sense, means the Island of Malta, the Island of Gozo and the other islands of the 

Maltese archipelago including the territorial sea thereof as well as any area of the 

sea-bed, its sub-soil and the superjacent water column adjacent to the territorial 

sea, where Malta exercises sovereign rights and jurisdiction in accordance with 

international law.

e) The term “Partner Jurisdiction” means a jurisdiction that has in effect an 

agreement with the United States to facilitate the implementation of FATCA. The 

IRS shall publish a list identifying all Partner Jurisdictions.

f) The term “Competent Authority” means:

(1) in the case of the United States, the Secretary of the Treasury or his 

delegate; and

(2) in the case of Malta, the Minister responsible for finance or his authorised 

representative.
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g) The term “Financial Institution” means a Custodial Institution, a Depository 

Institution, an Investment Entity, or a Specified Insurance Company.

h) The term “Custodial Institution” means any Entity that holds, as a substantial 

portion of its business, financial assets for the account of others. An entity holds 

financial assets for the account of others as a substantial portion of its business if 

the entity’s gross income attributable to the holding of financial assets and related 

financial services equals or exceeds 20 percent of the entity’s gross income during 

the shorter of: (i) the three-year period that ends on December 31 (or the final day 

of a non-calendar year accounting period) prior to the year in which the 

determination is being made; or (ii) the period during which the entity has been in 

existence.

i) The term “Depository Institution” means any Entity that accepts deposits in the 

ordinary course of a banking or similar business.

j) The term “Investment Entity” means any Entity that conducts as a business (or 

is managed by an entity that conducts as a business) one or more of the following 

activities or operations for or on behalf of a customer:

(1) trading in money market instruments (cheques, bills, certificates of 

deposit, derivatives, etc.); foreign exchange; exchange, interest rate and 

index instruments; transferable securities; or commodity futures trading;

(2) individual and collective portfolio management; or

(3) otherwise investing, administering, or managing funds or money on behalf 

of other persons.

This subparagraph 1(j) shall be interpreted in a manner consistent with similar 

language set forth in the definition of “financial institution” in the Financial 

Action Task Force Recommendations.

k) The term “Specified Insurance Company” means any Entity that is an insurance 

company (or the holding company of an insurance company) that issues, or is 

obligated to make payments with respect to, a Cash Value Insurance Contract or 

an Annuity Contract.

l) The term “Malta Financial Institution” means (i) any Financial Institution 

resident in Malta, but excluding any branch of such Financial Institution that is 

located outside Malta, and (ii) any branch of a Financial Institution not resident in 

Malta, if such branch is located in Malta.

m) The term “Partner Jurisdiction Financial Institution” means (i) any Financial 

Institution established in a Partner Jurisdiction, but excluding any branch of such 

Financial Institution that is located outside the Partner Jurisdiction, and (ii) any 
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branch of a Financial Institution not established in the Partner Jurisdiction, if such 

branch is located in the Partner Jurisdiction.

n) The term “Reporting Financial Institution” means a Reporting Malta Financial 

Institution or a Reporting U.S. Financial Institution, as the context requires.

o) The term “Reporting Malta Financial Institution” means any Malta Financial 

Institution that is not a Non-Reporting Malta Financial Institution.

p) The term “Reporting U.S. Financial Institution” means (i) any Financial 

Institution that is resident in the United States, but excluding any branch of such 

Financial Institution that is located outside the United States, and (ii) any branch 

of a Financial Institution not resident in the United States, if such branch is 

located in the United States, provided that the Financial Institution or branch has 

control, receipt, or custody of income with respect to which information is 

required to be exchanged under subparagraph (2)(b) of Article 2 of this 

Agreement.

q) The term “Non-Reporting Malta Financial Institution” means any Malta 

Financial Institution, or other Entity resident in Malta that is described in Annex 

II as a Non-Reporting Malta Financial Institution or that otherwise qualifies as a 

deemed-compliant FFI or an exempt beneficial owner under relevant U.S. 

Treasury Regulations.

r) The term “Nonparticipating Financial Institution” means a nonparticipating

FFI, as that term is defined in relevant U.S. Treasury Regulations, but does not 

include a Malta Financial Institution or other Partner Jurisdiction Financial 

Institution other than a Financial Institution treated as a Nonparticipating 

Financial Institution pursuant to subparagraph 2(b) of Article 5 of this Agreement 

or the corresponding provision in an agreement between the United States and a 

Partner Jurisdiction.

s) The term “Financial Account” means an account maintained by a Financial 

Institution, and includes:

(1) in the case of an Entity that is a Financial Institution solely because it is an 

Investment Entity, any equity or debt interest (other than interests that are 

regularly traded on an established securities market) in the Financial 

Institution;

(2) in the case of a Financial Institution not described in subparagraph 1(s)(1) 

of this Article, any equity or debt interest in the Financial Institution (other 

than interests that are regularly traded on an established securities market), 

if (i) the value of the debt or equity interest is determined, directly or 

indirectly, primarily by reference to assets that give rise to U.S. Source 
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Withholdable Payments, and (ii) the class of interests was established with 

a purpose of avoiding reporting in accordance with this Agreement; and

(3) any Cash Value Insurance Contract and any Annuity Contract issued or 

maintained by a Financial Institution, other than a noninvestment-linked, 

nontransferable immediate life annuity that is issued to an individual and 

monetizes a pension or disability benefit provided under an account, 

product, or arrangement that is excluded from the definition of Financial 

Account in Annex II.

Notwithstanding the foregoing, the term “Financial Account” does not include 

any account that is excluded from the definition of Financial Account in Annex II. 

For purposes of this Agreement, 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 officially 

recognized and supervised by a governmental authority in which the market is 

located and that has a meaningful annual value of shares traded on the 

exchange. For purposes of this subparagraph 1(s), an interest in a Financial 

Institution is not “regularly traded” and shall be treated as a Financial Account if 

the holder of the interest (other than a Financial Institution acting as an 

intermediary) is registered on the books of such Financial Institution. The

preceding sentence will not apply to interests first registered on the books of such 

Financial Institution prior to July 1, 2014, and with respect to interests first 

registered on the books of such Financial Institution on or after July 1, 2014, a 

Financial Institution is not required to apply the preceding sentence prior to 

January 1, 2016.

t) The term “Depository Account” includes any commercial, checking, savings, 

time, or thrift account, or an account that is evidenced by a certificate of deposit, 

thrift certificate, investment certificate, certificate of indebtedness, or other 

similar instrument maintained by a Financial Institution in the ordinary course of 

a banking or similar business. A Depository Account also includes an amount 

held by an insurance company pursuant to a guaranteed investment contract or 

similar agreement to pay or credit interest thereon.

u) The term “Custodial Account” means an account (other than an Insurance 

Contract or Annuity Contract) for the benefit of another person that holds any 

financial instrument or contract held for investment (including, but not limited to, 

a share or stock in a corporation, a note, bond, debenture, or other evidence of 

indebtedness, a currency or commodity transaction, a credit default swap, a swap 

based upon a nonfinancial index, a notional principal contract, an Insurance 

Contract or Annuity Contract, and any option or other derivative instrument).

v) The term “Equity Interest” means, in the case of a partnership that is a Financial 

Institution, either a capital or profits interest in the partnership. In the case of a 

trust that is a Financial Institution, an Equity Interest is considered to be held by 
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any person treated as a settlor or beneficiary of all or a portion of the trust, or any 

other natural person exercising ultimate effective control over the trust. A 

Specified U.S. Person shall be treated as being a beneficiary of a foreign trust if 

such Specified U.S. Person has the right to receive directly or indirectly (for 

example, through a nominee) a mandatory distribution or may receive, directly or 

indirectly, a discretionary distribution from the trust.

w) The term “Insurance Contract” means a contract (other than an Annuity 

Contract) under which the issuer agrees to pay an amount upon the occurrence of 

a specified contingency involving mortality, morbidity, accident, liability, or 

property risk.

x) The term “Annuity Contract” means a contract under which the issuer agrees to 

make payments for a period of time determined in whole or in part by reference to 

the life expectancy of one or more individuals. The term also includes a contract 

that is considered to be an Annuity Contract in accordance with the law, 

regulation, or practice of the jurisdiction in which the contract was issued, and 

under which the issuer agrees to make payments for a term of years.

y) The term “Cash Value Insurance Contract” means an Insurance Contract (other 

than an indemnity reinsurance contract between two insurance companies) that 

has a Cash Value greater than $50,000.

z) The term “Cash Value” means the greater of (i) the amount that the policyholder 

is entitled to receive upon surrender or termination of the contract (determined 

without reduction for any surrender charge or policy loan), and (ii) the amount the 

policyholder can borrow under or with regard to the contract. Notwithstanding the 

foregoing, the term “Cash Value” does not include an amount payable under an 

Insurance Contract as:

(1) a personal injury or sickness benefit or other benefit providing 

indemnification of an economic loss incurred upon the occurrence of the 

event insured against;

(2) a refund to the policyholder of a previously paid premium under an 

Insurance Contract (other than under a life insurance contract) due to 

policy cancellation or termination, decrease in risk exposure during the 

effective period of the Insurance Contract, or arising from a 

redetermination of the premium due to correction of posting or other 

similar error; or

(3) a policyholder dividend based upon the underwriting experience of the 

contract or group involved.
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aa) The term “Reportable Account” means a U.S. Reportable Account or a Malta 

Reportable Account, as the context requires.

bb) The term “Malta Reportable Account” means a Financial Account maintained 

by a Reporting U.S. Financial Institution if: (i) in the case of a Depository 

Account, the account is held by an individual resident in Malta and more than $10 

of interest is paid to such account in any given calendar year; or (ii) in the case of 

a Financial Account other than a Depository Account, the Account Holder is a 

resident of Malta, including an Entity that certifies that it is resident in Malta for 

tax purposes, with respect to which U.S. source income that is subject to reporting 

under chapter 3 of subtitle A or chapter 61 of subtitle F of the U.S. Internal 

Revenue Code is paid or credited.

cc) The term “U.S. Reportable Account” means a Financial Account maintained by 

a Reporting Malta Financial Institution and held by one or more Specified U.S. 

Persons or by a Non-U.S. Entity with one or more Controlling Persons that is a 

Specified U.S. Person. Notwithstanding the foregoing, an account shall not be 

treated as a U.S. Reportable Account if such account is not identified as a U.S. 

Reportable Account after application of the due diligence procedures in Annex I.

dd) The term “Account Holder” means the person listed or identified as the holder of 

a Financial Account by the Financial Institution that maintains the account. A 

person, other than a Financial Institution, holding a Financial Account for the 

benefit or account of another person as agent, custodian, nominee, signatory, 

investment advisor, or intermediary, is not treated as holding the account for 

purposes of this Agreement, and such other person is treated as holding the 

account. For purposes of the immediately preceding sentence, the term “Financial 

Institution” does not include a Financial Institution organized or incorporated in a 

U.S. Territory. In the case of a Cash Value Insurance Contract or an Annuity 

Contract, the Account Holder is any person entitled to access the Cash Value or 

change the beneficiary of the contract. If no person can access the Cash Value or 

change the beneficiary, the Account Holder is any person named as the owner in 

the contract and any person with a vested entitlement to payment under the terms 

of the contract. Upon the maturity of a Cash Value Insurance Contract or an 

Annuity Contract, each person entitled to receive a payment under the contract is 

treated as an Account Holder.

ee) The term “U.S. Person” means a U.S. citizen or resident individual, a partnership 

or corporation organized in the United States or under the laws of the United 

States or any State thereof, a trust if (i) a court within the United States would 

have authority under applicable law to render orders or judgments concerning 

substantially all issues regarding administration of the trust, and (ii) one or more 

U.S. persons have the authority to control all substantial decisions of the trust, or 

an estate of a decedent that is a citizen or resident of the United States. This 

subparagraph 1(ee) shall be interpreted in accordance with the U.S. Internal 

Revenue Code.
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ff) The term “Specified U.S. Person” means a U.S. Person, other than: (i) a 

corporation the stock of which is regularly traded on one or more established 

securities markets; (ii) any corporation that is a member of the same 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) the United States or any wholly 

owned agency or instrumentality thereof; (iv) any State of the United States, any 

U.S. Territory, any political subdivision of 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 investment 

company as defined in section 851 of the U.S. Internal Revenue Code or any 

entity registered with the U.S. Securities and Exchange Commission under the 

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 United States 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 is described in section 403(b) or section 457(b) of the U.S. 

Internal Revenue Code.

gg) The term “Entity” means a legal person or a legal arrangement such as a trust.

hh) The term “Non-U.S. Entity” means an Entity that is not a U.S. Person.

ii) The term “U.S. Source Withholdable Payment” means any payment of interest 

(including any original issue discount), dividends, rents, salaries, wages, 

premiums, annuities, compensations, remunerations, emoluments, and other fixed 

or determinable annual or periodical gains, profits, and income, if such payment is 

from sources within the United States. Notwithstanding the foregoing, a U.S. 

Source Withholdable Payment does not include any payment that is not treated as 

a withholdable payment in relevant U.S. Treasury Regulations.

jj) An Entity is a “Related Entity” of another Entity if either Entity controls the 

other Entity, or the two Entities are under common control. For this purpose 

control includes direct or indirect ownership of more than 50 percent of the vote 

or value in an Entity. Notwithstanding the foregoing, the Malta Competent 

Authority may treat an Entity as not a Related Entity of another Entity if the two 

Entities are not members of the same expanded affiliated group as defined in 

section 1471(e)(2) of the U.S. Internal Revenue Code.
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kk) The term “U.S. TIN” means a U.S. federal taxpayer identifying number.

ll) The term “Malta TIN” means a Malta taxpayer identifying number.

mm) The term “Controlling Persons” means the natural persons who exercise control 

over an Entity. In the case of a trust, such term means the settlor, the trustees, the 

protector (if any), the beneficiaries or class of beneficiaries, and any other natural 

person exercising ultimate effective control over the trust, and in the case of a 

legal arrangement other than a trust, such term means persons in equivalent or 

similar positions. The term “Controlling Persons” shall be interpreted in a manner 

consistent with the Financial Action Task Force Recommendations.

2. Any term not otherwise defined in this Agreement shall, unless the context otherwise 

requires or the Competent Authorities agree to a common meaning (as permitted by domestic 

law), have the meaning that it has at that time under the law of the Party applying this 

Agreement, any meaning under the applicable tax laws of that Party prevailing over a meaning 

given to the term under other laws of that Party.

ARTICLE 2

Obligations to Obtain and Exchange Information with Respect to Reportable

Accounts

1. Subject to the provisions of Article 3 of this Agreement, each Party shall obtain the 

information specified in paragraph 2 of this Article with respect to all Reportable Accounts and 

shall annually exchange this information with the other Party on an automatic basis pursuant to 

the provisions of Article 26 of the Convention.

2. The information to be obtained and exchanged is:

a) In the case of Malta with respect to each U.S. Reportable Account of each 

Reporting Malta Financial Institution:

(1) the name, address, and U.S. TIN of each Specified U.S. Person that is an 

Account Holder of such account and, in the case of a Non-U.S. Entity that, 

after application of the due diligence procedures set forth in Annex I, is 

identified as having one or more Controlling Persons that is a Specified 

U.S. Person, the name, address, and U.S. TIN (if any) of such entity and 

each such Specified U.S. Person;

(2) the account number (or functional equivalent in the absence of an account 

number);
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(3) the name and identifying number of the Reporting Malta Financial 

Institution;

(4) the account balance or value (including, in the case of a Cash Value 

Insurance Contract or Annuity Contract, the Cash Value or surrender 

value) as of the end of the relevant calendar year or other appropriate 

reporting period or, if the account was closed during such year, 

immediately before closure;

(5) in the case of any Custodial Account:

(A) the total gross amount of interest, the total gross amount of 

dividends, and the total gross amount of other income generated 

with respect to the assets held in the account, in each case paid or 

credited to the account (or with respect to the account) during the 

calendar year or other appropriate reporting period; and

(B) the total gross proceeds from the sale or redemption of property 

paid or credited to the account during the calendar year or other 

appropriate reporting period with respect to which the Reporting 

Malta Financial Institution acted as a custodian, broker, nominee, 

or otherwise as an agent for the Account Holder;

(6) in the case of any Depository Account, the total gross amount of interest 

paid or credited to the account during the calendar year or other 

appropriate reporting period; and

(7) in the case of any account not described in subparagraph 2(a)(5) or 2(a)(6) 

of this Article, the total gross amount paid or credited to the Account 

Holder with respect to the account during the calendar year or other 

appropriate reporting period with respect to which the Reporting Malta 

Financial Institution is the obligor or debtor, including the aggregate 

amount of any redemption payments made to the Account Holder during 

the calendar year or other appropriate reporting period.

b) In the case of the United States, with respect to each Malta Reportable Account of 

each Reporting U.S. Financial Institution:

(1) the name, address, and Malta TIN of any person that is a resident of Malta 

and is an Account Holder of the account;

(2) the account number (or the functional equivalent in the absence of an 

account number);

(3) the name and identifying number of the Reporting U.S. Financial 

Institution;
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(4) the gross amount of interest paid on a Depository Account;

(5) the gross amount of U.S. source dividends paid or credited to the account; 

and

(6) the gross amount of other U.S. source income paid or credited to the 

account, to the extent subject to reporting under chapter 3 of subtitle A or 

chapter 61 of subtitle F of the U.S. Internal Revenue Code.

ARTICLE 3

Time and Manner of Exchange of Information

1. For purposes of the exchange obligation in Article 2 of this Agreement, the amount and 

characterization of payments made with respect to a U.S. Reportable Account may be 

determined in accordance with the principles of Malta’s tax laws, and the amount and 

characterization of payments made with respect to a Malta Reportable Account may be 

determined in accordance with principles of U.S. federal income tax law.

2. For purposes of the exchange obligation in Article 2 of this Agreement, the information 

exchanged shall identify the currency in which each relevant amount is denominated.

3. With respect to paragraph 2 of Article 2 of this Agreement, information is to be obtained 

and exchanged with respect to 2014 and all subsequent years, except that:

a) In the case of Malta:

(1) the information to be obtained and exchanged with respect to 2014 is only 

the information described in subparagraphs 2(a)(1) through 2(a)(4) of 

Article 2 of this Agreement;

(2) the information to be obtained and exchanged with respect to 2015 is the 

information described in subparagraphs 2(a)(1) through 2(a)(7) of Article 

2 of this Agreement, except for gross proceeds described in subparagraph 

2(a)(5)(B) of Article 2 of this Agreement; and

(3) the information to be obtained and exchanged with respect to 2016 and 

subsequent years is the information described in subparagraphs 2(a)(1) 

through 2(a)(7) of Article 2 of this Agreement;

b) In the case of the United States, the information to be obtained and exchanged 

with respect to 2014 and subsequent years is all of the information identified in 

subparagraph 2(b) of Article 2 of this Agreement.
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4. Notwithstanding paragraph 3 of this Article, with respect to each Reportable Account that 

is maintained by a Reporting Financial Institution as of June 30, 2014, and subject to paragraph 4 

of Article 6 of this Agreement, the Parties are not required to obtain and include in the 

exchanged information the Malta TIN or the U.S. TIN, as applicable, of any relevant person if 

such taxpayer identifying number is not in the records of the Reporting Financial Institution. In 

such case, the Parties shall obtain and include in the exchanged information the date of birth of the 

relevant person, if the Reporting Financial Institution has such date of birth in its records.

5. Subject to paragraphs 3 and 4 of this Article, the information described in Article 2 of 

this Agreement shall be exchanged within nine months after the end of the calendar year to 

which the information relates. 

6. The Competent Authorities of Malta and the United States shall enter into an agreement 

under the mutual agreement procedure provided for in Article 25 of the Convention, which shall:

a) establish the procedures for the automatic exchange obligations described in 

Article 2 of this Agreement;

b) prescribe rules and procedures as may be necessary to implement Article 5 of this 

Agreement; and

c) establish as necessary procedures for the exchange of the information reported 

under subparagraph 1(b) of Article 4 of this Agreement.

7. All information exchanged shall be subject to the confidentiality and other protections 

provided for in the Convention, including the provisions limiting the use of the information 

exchanged.

8. Following entry into force of this Agreement, each Competent Authority shall provide 

written notification to the other Competent Authority when it is satisfied that the jurisdiction of 

the other Competent Authority has in place (i) appropriate safeguards to ensure that the 

information received pursuant to this Agreement shall remain confidential and be used solely for 

tax purposes; and (ii) the infrastructure for an effective exchange relationship (including 

established processes for ensuring timely, accurate, and confidential information exchanges, 

effective and reliable communications, and demonstrated capabilities to promptly resolve 

questions and concerns about exchanges or requests for exchanges and to administer the 

provisions of Article 5 of this Agreement). The Competent Authorities shall endeavour in good 

faith to meet, prior to September 2015, to establish that each jurisdiction has such safeguards and 

infrastructure in place.

9. The obligations of the Parties to obtain and exchange information under Article 2 of this 

Agreement shall take effect on the date of the later of the written notifications described in 

paragraph 8 of this Article. Notwithstanding the foregoing, if the Malta Competent Authority is 

satisfied that the United States has the safeguards and infrastructure described in paragraph 8 of 

this Article in place, but additional time is necessary for the U.S. Competent Authority to 

establish that Malta has such safeguards and infrastructure in place, the obligation of Malta to 
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obtain and exchange information under Article 2 of this Agreement shall take effect on the date 

of the written notification provided by the Malta Competent Authority to the U.S. Competent 

Authority pursuant to paragraph 8 of this Article.

10. This Agreement shall terminate on September 30, 2015, if Article 2 of this Agreement is 

not in effect for either Party pursuant to paragraph 9 of this Article by that date.

ARTICLE 4

Application of FATCA to Malta Financial Institutions

1. Treatment of Reporting Malta Financial Institutions. Each Reporting Malta Financial

Institution shall be treated as complying with, and not subject to withholding under, section 1471 

of the U.S. Internal Revenue Code if Malta complies with its obligations under Articles 2 and 3 

of this Agreement with respect to such Reporting Malta Financial Institution, and the Reporting 

Malta Financial Institution:

a) identifies U.S. Reportable Accounts and reports annually to the Malta 

Commissioner for Revenue the information required to be reported in 

subparagraph 2(a) of Article 2 of this Agreement in the time and manner 

described in Article 3 of this Agreement;

b) for each of 2015 and 2016, reports annually to the Malta Commissioner for 

Revenue the name of each Nonparticipating Financial Institution to which it has 

made payments and the aggregate amount of such payments;

c) complies with the applicable registration requirements on the IRS FATCA 

registration website;

d) to the extent that a Reporting Malta Financial Institution is (i) acting as a qualified 

intermediary (for purposes of section 1441 of the U.S. Internal Revenue Code) 

that has elected to assume primary withholding responsibility under chapter 3 of 

subtitle A of the U.S. Internal Revenue Code, (ii) a foreign partnership that has 

elected to act as a withholding foreign partnership (for purposes of both sections 

1441 and 1471 of the U.S. Internal Revenue Code), or (iii) a foreign trust that has 

elected to act as a withholding foreign trust (for purposes of both sections 1441 

and 1471 of the U.S. Internal Revenue Code), withholds 30 percent of any U.S. 

Source Withholdable Payment to any Nonparticipating Financial Institution; and

e) in the case of a Reporting Malta Financial Institution that is not described in 

subparagraph 1(d) of this Article and that makes a payment of, or acts as an 

intermediary with respect to, a U.S. Source Withholdable Payment to any 

Nonparticipating Financial Institution, the Reporting Malta Financial Institution 

provides to any immediate payor of such U.S. Source Withholdable Payment the 

information required for withholding and reporting to occur with respect to such 

payment.
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Notwithstanding the foregoing, a Reporting Malta Financial Institution with respect to which the 

conditions of this paragraph 1 are not satisfied shall not be subject to withholding under section 

1471 of the U.S. Internal Revenue Code unless such Reporting Malta Financial Institution is 

treated by the IRS as a Nonparticipating Financial Institution pursuant to subparagraph 2(b) of 

Article 5 of this Agreement.

2. Suspension of Rules Relating to Recalcitrant Accounts. The United States shall not

require a Reporting Malta Financial Institution to withhold tax under section 1471 or 1472 of the 

U.S. Internal Revenue Code with respect to an account held by a recalcitrant account holder (as 

defined in section 1471(d)(6) of the U.S. Internal Revenue Code), or to close such account, if the 

U.S. Competent Authority receives the information set forth in subparagraph 2(a) of Article 2 of 

this Agreement, subject to the provisions of Article 3 of this Agreement, with respect to such 

account.

3. Specific Treatment of Malta Retirement Plans. The United States shall treat as 

deemed-compliant FFIs or exempt beneficial owners, as appropriate, for purposes of sections 

1471 and 1472 of the U.S. Internal Revenue Code, Malta retirement plans described in Annex II. 

For this purpose, a Malta retirement plan includes an Entity established or located in, and 

regulated by, Malta, or a predetermined contractual or legal arrangement, operated to provide 

pension or retirement benefits or earn income for providing such benefits under the laws of 

Malta and regulated with respect to contributions, distributions, reporting, sponsorship, and 

taxation.

4. Identification and Treatment of Other Deemed-Compliant FFIs and Exempt 

Beneficial Owners. The United States shall treat each Non-Reporting Malta Financial Institution 

as a deemed-compliant FFI or as an exempt beneficial owner, as appropriate, for purposes of 

section 1471 of the U.S. Internal Revenue Code.

5. Special Rules Regarding Related Entities and Branches That Are Nonparticipating 

Financial Institutions. If a Malta Financial Institution, that otherwise meets the requirements 

described in paragraph 1 of this Article or is described in paragraph 3 or 4 of this Article, has a 

Related Entity or branch that operates 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 a Related 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 Malta Financial Institution shall continue to be in compliance with the terms of this 

Agreement and shall continue to be treated as a deemed-compliant FFI or an exempt beneficial 

owner, as appropriate, for purposes of section 1471 of the U.S. Internal Revenue Code, provided 

that:

a) the Malta Financial Institution treats each such Related Entity or branch as a 

separate Nonparticipating Financial Institution for purposes of all the reporting 

and withholding requirements of this Agreement and each such Related Entity or 
15

branch identifies itself to withholding agents as a Nonparticipating Financial 

Institution;

b) each such Related Entity or branch identifies its U.S. accounts and reports the 

information with respect to those accounts as required under section 1471 of the 

U.S. Internal Revenue Code to the extent permitted under the relevant laws 

pertaining to the Related Entity or branch; and

c) such Related Entity or branch does not specifically solicit U.S. accounts held by 

persons that are not resident in the jurisdiction where such Related Entity or 

branch is located or accounts held by Nonparticipating Financial Institutions that 

are not established in the jurisdiction where such Related Entity or branch is 

located, and such Related Entity or branch is not used by the Malta Financial 

Institution or any other Related Entity to circumvent the obligations under this 

Agreement or under section 1471 of the U.S. Internal Revenue Code, as 

appropriate.

6. Coordination of Timing. Notwithstanding paragraphs 3 and 5 of Article 3 of this 

Agreement:

a) Malta shall not be obligated to obtain and exchange information with respect to a 

calendar year that is prior to the calendar year with respect to which similar 

information is required to be reported to the IRS by participating FFIs pursuant to 

relevant U.S. Treasury Regulations;

b) Malta shall not be obligated to begin exchanging information prior to the date by 

which participating FFIs are required to report similar information to the IRS 

under relevant U.S. Treasury Regulations;

c) the United States shall not be obligated to obtain and exchange information with 

respect to a calendar year that is prior to the first calendar year with respect to 

which Malta is required to obtain and exchange information; and

d) the United States shall not be obligated to begin exchanging information prior to 

the date by which Malta is required to begin exchanging information.

7. Coordination of Definitions with U.S. Treasury Regulations. Notwithstanding Article 

1 of this Agreement and the definitions provided in the Annexes to this Agreement, in 

implementing this Agreement, Malta may use, and may permit Malta Financial Institutions to 

use, a definition in relevant U.S. Treasury Regulations in lieu of a corresponding definition in 

this Agreement, provided that such application would not frustrate the purposes of this 

Agreement. 

ARTICLE 5

Collaboration on Compliance and Enforcement
16

1. Minor and Administrative Errors. A Competent Authority shall notify the Competent 

Authority of the other Party when the first-mentioned Competent Authority has reason to believe 

that administrative errors or other minor errors may have led to incorrect or incomplete 

information reporting or resulted in other infringements of this Agreement. The Competent 

Authority of such other Party shall apply its domestic law (including applicable penalties) to 

obtain corrected and/or complete information or to resolve other infringements of this 

Agreement. 

2. Significant Non-Compliance.

a) A Competent Authority shall notify the Competent Authority of the other Party 

when the first-mentioned Competent Authority has determined that there is 

significant non-compliance with the obligations under this Agreement with 

respect to a Reporting Financial Institution in the other jurisdiction. The 

Competent Authority of such other Party shall apply its domestic law (including 

applicable penalties) to address the significant non-compliance described in the 

notice. 

b) If, in the case of a Reporting Malta Financial Institution, such enforcement actions 

do not resolve the non-compliance within a period of 18 months after notification 

of significant non-compliance is first provided, the United States shall treat the 

Reporting Malta Financial Institution as a Nonparticipating Financial Institution 

pursuant to this subparagraph 2(b).

3. Reliance on Third Party Service Providers. Each Party may allow Reporting Financial 

Institutions to use third party service providers to fulfil the obligations imposed on such 

Reporting Financial Institutions by a Party, as contemplated in this Agreement, but these 

obligations shall remain the responsibility of the Reporting Financial Institutions.

4. Prevention of Avoidance. The Parties shall implement as necessary requirements to 

prevent Financial Institutions from adopting practices intended to circumvent the reporting 

required under this Agreement.

ARTICLE 6

Mutual Commitment to Continue to Enhance the Effectiveness of Information

Exchange and Transparency

1. Reciprocity. The Government of the United States acknowledges the need to achieve 

equivalent levels of reciprocal automatic information exchange with Malta. The Government of 

the United States is committed to further improve transparency and enhance the exchange 

relationship with Malta by pursuing the adoption of regulations and advocating and supporting 

relevant legislation to achieve such equivalent levels of reciprocal automatic information 

exchange.
17

2. Treatment of Passthru Payments and Gross Proceeds. The Parties are committed to 

work together, along with Partner Jurisdictions, to develop a practical and effective alternative 

approach to achieve the policy objectives of foreign passthru payment and gross proceeds 

withholding that minimizes burden.

3. Development of Common Reporting and Exchange Model. The Parties are committed 

to working with Partner Jurisdictions, the Organisation for Economic Co-operation and 

Development, and the European Union, on adapting the terms of this Agreement and other 

agreements between the United States and Partner Jurisdictions to a common model for 

automatic exchange of information, including the development of reporting and due diligence 

standards for financial institutions.

4. Documentation of Accounts Maintained as of June 30, 2014. With respect to 

Reportable Accounts maintained by a Reporting Financial Institution as of June 30, 2014:

a) The United States commits to establish, by January 1, 2017, for reporting with 

respect to 2017 and subsequent years, rules requiring Reporting U.S. Financial 

Institutions to obtain and report the Malta TIN of each Account Holder of a Malta 

Reportable Account as required pursuant to subparagraph 2(b)(1) of Article 2 of 

this Agreement; and

b) Malta commits to establish, by January 1, 2017, for reporting with respect to 2017 

and subsequent years, rules requiring Reporting Malta Financial Institutions to 

obtain the U.S. TIN of each Specified U.S. Person as required pursuant to 

subparagraph 2(a)(1) of Article 2 of this Agreement.

ARTICLE 7

Consistency in the Application of FATCA to Partner Jurisdictions

1. Malta shall be granted the benefit of any more favourable terms under Article 4 or Annex 

1 of this Agreement relating to the application of FATCA to Malta Financial Institutions 

afforded to another Partner Jurisdiction under a signed bilateral agreement pursuant to which the 

other Partner Jurisdiction commits to undertake the same obligations as Malta described in 

Articles 2 and 3 of this Agreement, and subject to the same terms and conditions as described 

therein and in Articles 5 through 9 of this Agreement.

2. The United States shall notify Malta of any such more favorable terms and such more 

favorable terms shall apply automatically under this Agreement as if such terms were specified 

in this Agreement and effective as of the date of the entry into force of the agreement 

incorporating the more favorable terms, unless Malta declines the application thereof.
18

ARTICLE 8

Consultations and Amendments

1. In case any difficulties in the implementation of this Agreement arise, either Party may 

request consultations to develop appropriate measures to ensure the fulfilment of this Agreement.

2. This Agreement may be amended by written mutual agreement of the Parties. Unless 

otherwise agreed upon, such an amendment shall enter into force through the same procedures as 

set forth in paragraph 1 of Article 10 of this Agreement.

ARTICLE 9

Annexes

The Annexes form an integral part of this Agreement.

ARTICLE 10

Term of Agreement

1. This Agreement shall enter into force on the date of Malta’s written notification to the 

United States that Malta has completed its necessary internal procedures for entry into force of 

this Agreement.

2. Either Party may terminate this Agreement by giving notice of termination in writing to 

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

the expiration of a period of 12 months after the date of the notice of termination 

3. The Parties shall, prior to December 31, 2016, consult in good faith to amend this 

Agreement as necessary to reflect progress on the commitments set forth in Article 6 of this 

Agreement.

In witness whereof, the undersigned, being duly authorized thereto by their respective 

Governments, have signed this Agreement.

Done at Valletta, in duplicate, in the English language, this16 day of December, 2013.

FOR THE GOVERNMENT OF FOR THE GOVERNMENT OF

THE UNITED STATES OF THE REPUBLIC OF MALTA:

AMERICA:
19
20

ANNEX I

DUE DILIGENCE OBLIGATIONS FOR IDENTIFYING AND REPORTING ON U.S.

REPORTABLE ACCOUNTS AND ON PAYMENTS TO CERTAIN

NONPARTICIPATING FINANCIAL INSTITUTIONS

I. General.

A. Malta shall require that Reporting Malta Financial Institutions apply the due 

diligence procedures contained in this Annex I to identify U.S. Reportable Accounts and 

accounts held by Nonparticipating Financial Institutions.

B. For purposes of the Agreement,

1. All dollar amounts are in U.S. dollars and shall be read to include the 

equivalent in other currencies.

2. Except as otherwise provided herein, the balance or value of an account 

shall be determined as of the last day of the calendar year or other appropriate 

reporting period.

3. Where a balance or value threshold is to be determined as of June 30, 

2014, under this Annex I, the relevant balance or value shall be determined as of

that day or the last day of the reporting period ending immediately before June 30, 

2014, and where a balance or value threshold is to be determined as of the last day 

of a calendar year under this Annex I, the relevant balance or value shall be 

determined as of the last day of the calendar year or other appropriate reporting 

period.

4. Subject to subparagraph E(1) of section II of this Annex I, an account shall 

be treated as a U.S. Reportable Account beginning as of the date it is identified as 

such pursuant to the due diligence procedures in this Annex I.

5. Unless otherwise provided, information with respect to a U.S. Reportable 

Account shall be reported annually in the calendar year following the year to 

which the information relates.

C. As an alternative to the procedures described in each section of this Annex I, 

Malta may permit Reporting Malta Financial Institutions to rely on the procedures 

described in relevant U.S. Treasury Regulations to establish whether an account is a U.S. 

Reportable Account or an account held by a Nonparticipating Financial Institution. Malta 

may permit Reporting Malta Financial Institutions to make such election separately for 

each section of this Annex I either with respect to all relevant Financial Accounts or, 

separately, with respect to any clearly identified group of such accounts (such as by line 

of business or the location of where the account is maintained).
21

II. Preexisting Individual Accounts. The following rules and procedures apply for 

purposes of identifying U.S. Reportable Accounts among Preexisting Accounts held by 

individuals (“Preexisting Individual Accounts”).

A. Accounts Not Required to Be Reviewed, Identified, or Reported. Unless the 

Reporting Malta Financial Institution elects otherwise, either with respect to all 

Preexisting Individual Accounts or, separately, with respect to any clearly identified 

group of such accounts, where the implementing rules in Malta provide for such an 

election, the following Preexisting Individual Accounts are not required to be reviewed, 

identified, or reported as U.S. Reportable Accounts:

1. Subject to subparagraph E(2) of this section, a Preexisting Individual 

Account with a balance or value that does not exceed $50,000 as of June 30, 

2014.

2. Subject to subparagraph E(2) of this section, a Preexisting Individual 

Account that is a Cash Value Insurance Contract or an Annuity Contract with a 

balance or value of $250,000 or less as of June 30, 2014.

3. A Preexisting Individual Account that is a Cash Value Insurance Contract 

or an Annuity Contract, provided the law or regulations of Malta or the United 

States effectively prevent the sale of such a Cash Value Insurance Contract or an 

Annuity Contract to U.S. residents (e.g., if the relevant Financial Institution does 

not have the required registration under U.S. law, and the law of Malta requires 

reporting or withholding with respect to insurance products held by residents of 

Malta).

4. A Depository Account with a balance of $50,000 or less.

B. Review Procedures for Preexisting Individual Accounts With a Balance or 

Value as of June 30, 2014, that Exceeds $50,000 ($250,000 for a Cash Value 

Insurance Contract or Annuity Contract), But Does Not Exceed $1,000,000 (“Lower 

Value Accounts”).

1. Electronic Record Search. The Reporting Malta Financial Institution 

must review electronically searchable data maintained by the Reporting Malta 

Financial Institution for any of the following U.S. indicia:

a) Identification of the Account Holder as a U.S. citizen or resident;

b) Unambiguous indication of a U.S. place of birth;

c) Current U.S. mailing or residence address (including a U.S. post 

office box);

d) Current U.S. telephone number;
22

e) Standing instructions to transfer funds to an account maintained in 

the United States;

f) Currently effective power of attorney or signatory authority 

granted to a person with a U.S. address; or

g) An “in-care-of” or “hold mail” address that is the sole address the 

Reporting Malta Financial Institution has on file for the Account Holder. 

In the case of a Preexisting Individual Account that is a Lower Value 

Account, an “in-care-of” address outside the United States or “hold mail” 

address shall not be treated as U.S. indicia.

2. If none of the U.S. indicia listed in subparagraph B(1) of this section are 

discovered in the electronic search, then no further action is required until there is 

a change in circumstances that results in one or more U.S. indicia being 

associated with the account, or the account becomes a High Value Account 

described in paragraph D of this section.

3. If any of the U.S. indicia listed in subparagraph B(1) of this section are 

discovered in the electronic search, or if there is a change in circumstances that 

results in one or more U.S. indicia being associated with the account, then the 

Reporting Malta Financial Institution must treat the account as a U.S. Reportable 

Account unless it elects to apply subparagraph B(4) of this section and one of the 

exceptions in such subparagraph applies with respect to that account.

4. Notwithstanding a finding of U.S. indicia under subparagraph B(1) of this 

section, a Reporting Malta Financial Institution is not required to treat an account 

as a U.S. Reportable Account if:

a) Where the Account Holder information unambiguously indicates a 

U.S. place of birth, the Reporting Malta Financial Institution obtains or 

has previously reviewed and maintains a record of:

(1) A self-certification that the Account Holder is neither a 

U.S. citizen nor a U.S. resident for tax purposes (which may be on 

an IRS Form W-8 or other similar agreed form);

(2) A non-U.S. passport or other government-issued 

identification evidencing the Account Holder’s citizenship or 

nationality in a country other than the United States; and

(3) A copy of the Account Holder’s Certificate of Loss of 

Nationality of the United States or a reasonable explanation of:
23

(a) The reason the Account Holder does not have such 

a certificate despite relinquishing U.S. citizenship; or

(b) The reason the Account Holder did not obtain U.S. 

citizenship at birth.

b) Where the Account Holder information contains a current U.S. 

mailing or residence address, or one or more U.S. telephone numbers 

that are the only telephone numbers associated with the account, the 

Reporting Malta Financial Institution obtains, or has previously reviewed 

and maintains a record of:

(1) A self-certification that the Account Holder is neither a 

U.S. citizen nor a U.S. resident for tax purposes (which may be on 

an IRS Form W-8 or other similar agreed form); and

(2) Documentary evidence, as defined in paragraph D of 

section VI of this Annex I, establishing the Account Holder’s nonU.S. status.

c) Where the Account Holder information contains standing 

instructions to transfer funds to an account maintained in the United 

States, the Reporting Malta Financial Institution obtains, or has previously 

reviewed and maintains a record of:

(1) A self-certification that the Account Holder is neither a 

U.S. citizen nor a U.S. resident for tax purposes (which may be on 

an IRS Form W-8 or other similar agreed form); and

(2) Documentary evidence, as defined in paragraph D of section VI 

of this Annex I, establishing the Account Holder’s non-U.S. status.

d) Where the Account Holder information contains a currently 

effective power of attorney or signatory authority granted to a person 

with a U.S. address, has an “in-care-of” address or “hold mail” address 

that is the sole address identified for the Account Holder, or has one or 

more U.S. telephone numbers (if a non-U.S. telephone number is also 

associated with the account), the Reporting Malta Financial Institution 

obtains, or has previously reviewed and maintains a record of:

(1) A self-certification that the Account Holder is neither a 

U.S. citizen nor a U.S. resident for tax purposes (which may be on 

an IRS Form W-8 or other similar agreed form); or
24

(2) Documentary evidence, as defined in paragraph D of 

section VI of this Annex I, establishing the Account Holder’s nonU.S. status.

C. Additional Procedures Applicable to Preexisting Individual Accounts That 

Are Lower Value Accounts.

1. Review of Preexisting Individual Accounts that are Lower Value 

Accounts for U.S. indicia must be completed by June 30, 2016.

2. If there is a change of circumstances with respect to a Preexisting 

Individual Account that is a Lower Value Account that results in one or more U.S. 

indicia described in subparagraph B(1) of this section being associated with the 

account, then the Reporting Malta Financial Institution must treat the account as a 

U.S. Reportable Account unless subparagraph B(4) of this section applies.

3. Except for Depository Accounts described in subparagraph A(4) of this 

section, any Preexisting Individual Account that has been identified as a U.S. 

Reportable Account under this section shall be treated as a U.S. Reportable 

Account in all subsequent years, unless the Account Holder ceases to be a 

Specified U.S. Person.

D. Enhanced Review Procedures for Preexisting Individual Accounts With a 

Balance or Value That Exceeds $1,000,000 as of June 30, 2014, or December 31 of 2015 

or Any Subsequent Year (“High Value Accounts”).

1. Electronic Record Search. The Reporting Malta Financial Institution 

must review electronically searchable data maintained by the Reporting Malta 

Financial Institution for any of the U.S. indicia described in subparagraph B(1) of 

this section.

2. Paper Record Search. If the Reporting Malta Financial Institution’s 

electronically searchable databases include fields for, and capture all of the 

information described in, subparagraph D(3) of this section, then no further paper 

record search is required. If the electronic databases do not capture all of this 

information, then with respect to a High Value Account, the Reporting Malta 

Financial Institution must also review the current customer master file and, to the 

extent not contained in the current customer master file, the following documents 

associated with the account and obtained by the Reporting Malta Financial 

Institution within the last five years for any of the U.S. indicia described in 

subparagraph B(1) of this section:

a) The most recent documentary evidence collected with respect to 

the account;

b) The most recent account opening contract or documentation;
25

c) The most recent documentation obtained by the Reporting Malta 

Financial Institution pursuant to AML/KYC Procedures or for other 

regulatory purposes;

d) Any power of attorney or signature authority forms currently in 

effect; and

e) Any standing instructions to transfer funds currently in effect.

3. Exception Where Databases Contain Sufficient Information. A 

Reporting Malta Financial Institution is not required to perform the paper record 

search described in subparagraph D(2) of this section if the Reporting Malta 

Financial Institution’s electronically searchable information includes the 

following:

a) The Account Holder’s nationality or residence status;

b) The Account Holder’s residence address and mailing address 

currently on file with the Reporting Malta Financial Institution;

c) The Account Holder’s telephone number(s) currently on file, if 

any, with the Reporting Malta Financial Institution;

d) Whether there are standing instructions to transfer funds in the 

account to another account (including an account at another branch of the 

Reporting Malta Financial Institution or another Financial Institution);

e) Whether there is a current “in-care-of” address or “hold mail” 

address for the Account Holder; and

f) Whether there is any power of attorney or signatory authority for 

the account.

4. Relationship Manager Inquiry for Actual Knowledge. In addition to 

the electronic and paper record searches described above, the Reporting Malta 

Financial Institution must treat as a U.S. Reportable Account any High Value 

Account assigned to a relationship manager (including any Financial Accounts 

aggregated with such High Value Account) if the relationship manager has actual 

knowledge that the Account Holder is a Specified U.S. Person.

5. Effect of Finding U.S. Indicia.

a) If none of the U.S. indicia listed in subparagraph B(1) of this 

section are discovered in the enhanced review of High Value Accounts 

described above, and the account is not identified as held by a Specified 
26

U.S. Person in subparagraph D(4) of this section, then no further action is 

required until there is a change in circumstances that results in one or 

more U.S. indicia being associated with the account.

b) If any of the U.S. indicia listed in subparagraph B(1) of this section 

are discovered in the enhanced review of High Value Accounts described 

above, or if there is a subsequent change in circumstances that results in 

one or more U.S. indicia being associated with the account, then the 

Reporting Malta Financial Institution must treat the account as a U.S. 

Reportable Account unless it elects to apply subparagraph B(4) of this 

section and one of the exceptions in such subparagraph applies with 

respect to that account.

c) Except for Depository Accounts described in subparagraph A(4) of 

this section, any Preexisting Individual Account that has been identified as 

a U.S. Reportable Account under this section shall be treated as a U.S. 

Reportable Account in all subsequent years, unless the Account Holder 

ceases to be a Specified U.S. Person.

E. Additional Procedures Applicable to High Value Accounts.

1. If a Preexisting Individual Account is a High Value Account as of June 30, 

2014, the Reporting Malta Financial Institution must complete the enhanced 

review procedures described in paragraph D of this section with respect to such 

account by June 30, 2015. If based on this review such account is identified as a 

U.S. Reportable Account on or before December 31, 2014, the Reporting Malta 

Financial Institution must report the required information about such account with 

respect to 2014 in the first report on the account and on an annual basis thereafter. 

In the case of an account identified as a U.S. Reportable Account after December 

31, 2014, and on or before June 30, 2015, the Reporting Malta Financial 

Institution is not required to report information about such account with respect to 

2014 , but must report information about the account on an annual basis 

thereafter.

2. If a Preexisting Individual Account is not a High Value Account as of 

June 30, 2014, but becomes a High Value Account as of the last day of 2015 or 

any subsequent calendar year, the Reporting Malta Financial Institution must 

complete the enhanced review procedures described in paragraph D of this section 

with respect to such account within six months after the last day of the calendar 

year in which the account becomes a High Value Account. If based on this review 

such account is identified as a U.S. Reportable Account, the Reporting Malta 

Financial Institution must report the required information about such account with 

respect to the year in which it is identified as a U.S. Reportable Account and 

subsequent years on an annual basis, unless the Account Holder ceases to be a 

Specified U.S. Person.
27

3. Once a Reporting Malta Financial Institution applies the enhanced review 

procedures described in paragraph D of this section to a High Value Account, the 

Reporting Malta Financial Institution is not required to re-apply such procedures, 

other than the relationship manager inquiry described in subparagraph D(4) of this 

section, to the same High Value Account in any subsequent year.

4. If there is a change of circumstances with respect to a High Value Account 

that results in one or more U.S. indicia described in subparagraph B(1) of this 

section being associated with the account, then the Reporting Malta Financial 

Institution must treat the account as a U.S. Reportable Account unless it elects to 

apply subparagraph B(4) of this section and one of the exceptions in such 

subparagraph applies with respect to that account.

5. A Reporting Malta Financial Institution must implement procedures to 

ensure that a relationship manager identifies any change in circumstances of an 

account. For example, if a relationship manager is notified that the Account 

Holder has a new mailing address in the United States, the Reporting Malta 

Financial Institution is required to treat the new address as a change in 

circumstances and, if it elects to apply subparagraph B(4) of this section, is 

required to obtain the appropriate documentation from the Account Holder.

F. Preexisting Individual Accounts That Have Been Documented for Certain 

Other Purposes. A Reporting Malta Financial Institution that has previously obtained 

documentation from an Account Holder to establish the Account Holder’s status as 

neither a U.S. citizen nor a U.S. resident in order to meet its obligations under a qualified 

intermediary, withholding foreign partnership, or withholding foreign trust agreement 

with the IRS, or to fulfil its obligations under chapter 61 of Title 26 of the United States 

Code, is not required to perform the procedures described in subparagraph B(1) of this 

section with respect to Lower Value Accounts or subparagraphs D(1) through D(3) of 

this section with respect to High Value Accounts.

III. New Individual Accounts. The following rules and procedures apply for purposes of 

identifying U.S. Reportable Accounts among Financial Accounts held by individuals and opened 

on or after July 1, 2014 (“New Individual Accounts”).

A. Accounts Not Required to Be Reviewed, Identified, or Reported. Unless the 

Reporting Malta Financial Institution elects otherwise, either with respect to all New 

Individual Accounts or, separately, with respect to any clearly identified group of such 

accounts, where the implementing rules in Malta provide for such an election, the 

following New Individual Accounts are not required to be reviewed, identified, or 

reported as U.S. Reportable Accounts:

1. A Depository Account unless the account balance exceeds $50,000 at the 

end of any calendar year or other appropriate reporting period.
28

2. A Cash Value Insurance Contract unless the Cash Value exceeds $50,000 

at the end of any calendar year or other appropriate reporting period.

B. Other New Individual Accounts. With respect to New Individual Accounts not 

described in paragraph A of this section, upon account opening (or within 90 days after 

the end of the calendar year in which the account ceases to be described in paragraph A 

of this section), the Reporting Malta Financial Institution must obtain a self-certification 

which may be part of the account opening documentation, that allows the Reporting 

Malta Financial Institution to determine whether the Account Holder is resident in the 

United States for tax purposes (for this purpose, a U.S. citizen is considered to be resident 

in the United States for tax purposes, even if the Account Holder is also a tax resident of 

another jurisdiction) and confirm the reasonableness of such self-certification based on 

the information obtained by the Reporting Malta Financial Institution in connection with 

the opening of the account, including any documentation collected pursuant to 

AML/KYC Procedures.

1. If the self-certification establishes that the Account Holder is resident in 

the United States for tax purposes, the Reporting Malta Financial Institution must 

treat the account as a U.S. Reportable Account and obtain a self-certification that 

includes the Account Holder’s U.S. TIN (which may be an IRS Form W-9 or 

other similar agreed form).

2. If there is a change of circumstances with respect to a New Individual 

Account that causes the Reporting Malta Financial Institution to know or have 

reason to know that the original self-certification is incorrect or unreliable, the 

Reporting Malta Financial Institution cannot rely on the original self-certification 

and must obtain a valid self-certification that establishes whether the Account 

Holder is a U.S. citizen or resident for U.S. tax purposes. If the Reporting Malta 

Financial Institution is unable to obtain a valid self-certification, the Reporting 

Malta Financial Institution must treat the account as a U.S. Reportable Account.

IV. Preexisting Entity Accounts. The following rules and procedures apply for purposes of 

identifying U.S. Reportable Accounts and accounts held by Nonparticipating Financial 

Institutions among Preexisting Accounts held by Entities (“Preexisting Entity Accounts”).

A. Entity Accounts Not Required to Be Reviewed, Identified, or Reported.

Unless the Reporting Malta Financial Institution elects otherwise, either with respect to 

all Preexisting Entity Accounts or, separately, with respect to any clearly identified group 

of such accounts, where the implementing rules in Malta provide for such an election, a 

Preexisting Entity Account with an account balance or value that does not exceed 

$250,000 as of June 30 2014, is not required to be reviewed, identified, or reported as a 

U.S. Reportable Account until the account balance or value exceeds $1,000,000.

B. Entity Accounts Subject to Review. A Preexisting Entity Account that has an 

account balance or value that exceeds $250,000 as of June 30, 2014, and a Preexisting 

Entity Account that does not exceed $250,000 as of June 30, 2014, but the account 
29

balance or value of which exceeds $1,000,000 as of the last day of 2015 or any 

subsequent calendar year, must be reviewed in accordance with the procedures set forth 

in paragraph D of this section.

C. Entity Accounts With Respect to Which Reporting is Required. With respect 

to Preexisting Entity Accounts described in paragraph B of this section, only accounts 

that are held by one or more Entities that are Specified U.S. Persons, or by Passive 

NFFEs with one or more Controlling Persons who are U.S. citizens or residents, shall be 

treated as U.S. Reportable Accounts. In addition, accounts held by Nonparticipating 

Financial Institutions shall be treated as accounts for which aggregate payments as 

described in subparagraph 1(b) of Article 4 of the Agreement are reported to the Malta 

Commissioner for Revenue.

D. Review Procedures for Identifying Entity Accounts With Respect to Which 

Reporting is Required. For Preexisting Entity Accounts described in paragraph B of this 

section, the Reporting Malta Financial Institution must apply the following review 

procedures to determine whether the account is held by one or more Specified U.S. 

Persons, by Passive NFFEs with one or more Controlling Persons who are U.S. citizens 

or residents, or by Nonparticipating Financial Institutions:

1. Determine Whether the Entity is a Specified U.S. Person.

a) Review information maintained for regulatory or customer 

relationship purposes (including information collected pursuant to 

AML/KYC Procedures) to determine whether the information indicates 

that the Account Holder is a U.S. Person. For this purpose, information 

indicating that the Account Holder is a U.S. Person includes a U.S. place 

of incorporation or organization, or a U.S. address.

b) If the information indicates that the Account Holder is a U.S. 

Person, the Reporting Malta Financial Institution must treat the account as 

a U.S. Reportable Account unless it obtains a self-certification from the 

Account Holder (which may be on an IRS Form W-8 or W-9, or a similar 

agreed form), or reasonably determines based on information in its 

possession or that is publicly available, that the Account Holder is not a 

Specified U.S. Person.

2. Determine Whether a Non-U.S. Entity is a Financial Institution.

a) Review information maintained for regulatory or customer 

relationship purposes (including information collected pursuant to 

AML/KYC Procedures) to determine whether the information indicates 

that the Account Holder is a Financial Institution.

b) If the information indicates that the Account Holder is a Financial 

Institution, or the Reporting Malta Financial Institution verifies the 
30

Account Holder’s Global Intermediary Identification Number on the 

published IRS FFI list, then the account is not a U.S. Reportable Account.

3. Determine Whether a Financial Institution is a Nonparticipating 

Financial Institution Payments to Which Are Subject to Aggregate Reporting 

Under Subparagraph 1(b) of Article 4 of the Agreement.

a) Subject to subparagraph D(3)(b) of this section, a Reporting Malta 

Financial Institution may determine that the Account Holder is a Malta 

Financial Institution or other Partner Jurisdiction Financial Institution if 

the Reporting Malta Financial Institution reasonably determines that the 

Account Holder has such status on the basis of the Account Holder’s 

Global Intermediary Identification Number on the published IRS FFI list 

or other information that is publicly available or in the possession of the 

Reporting Malta Financial Institution, as applicable. In such case, no 

further review, identification, or reporting is required with respect to the 

account.

b) If the Account Holder is a Malta Financial Institution or other 

Partner Jurisdiction Financial Institution treated by the IRS as a 

Nonparticipating Financial Institution, then the account is not a U.S. 

Reportable Account, but payments to the Account Holder must be 

reported as contemplated in subparagraph 1(b) of Article 4 of the 

Agreement.

c) If the Account Holder is not a Malta Financial Institution or other 

Partner Jurisdiction Financial Institution, then the Reporting Malta 

Financial Institution must treat the Account Holder as a Nonparticipating 

Financial Institution payments to which are reportable under subparagraph 

1(b) of Article 4 of the Agreement, unless the Reporting Malta Financial 

Institution:

(1) Obtains a self-certification (which may be on an IRS Form 

W-8 or similar agreed form) from the Account Holder that it is a 

certified deemed-compliant FFI, or an exempt beneficial owner, as 

those terms are defined in relevant U.S. Treasury Regulations; or

(2) In the case of a participating FFI or registered deemedcompliant FFI, verifies the Account Holder’s Global Intermediary 

Identification Number on the published IRS FFI list.

4. Determine Whether an Account Held by an NFFE Is a U.S. 

Reportable Account. With respect to an Account Holder of a Preexisting Entity 

Account that is not identified as either a U.S. Person or a Financial Institution, the 

Reporting Malta Financial Institution must identify (i) whether the Account 

Holder has Controlling Persons, (ii) whether the Account Holder is a Passive 
31

NFFE, and (iii) whether any of the Controlling Persons of the Account Holder is a 

U.S. citizen or resident. In making these determinations the Reporting Malta 

Financial Institution must follow the guidance in subparagraphs D(4)(a) through 

D(4)(d) of this section in the order most appropriate under the circumstances.

a) For purposes of determining the Controlling Persons of an Account 

Holder, a Reporting Malta Financial Institution may rely on information 

collected and maintained pursuant to AML/KYC Procedures.

b) For purposes of determining whether the Account Holder is a 

Passive NFFE, the Reporting Malta Financial Institution must obtain a 

self-certification (which may be on an IRS Form W-8 or W-9, or on a 

similar agreed form) from the Account Holder to establish its status, 

unless it has information in its possession or that is publicly available, 

based on which it can reasonably determine that the Account Holder is an 

Active NFFE.

c) For purposes of determining whether a Controlling Person of a 

Passive NFFE is a U.S. citizen or resident for tax purposes, a Reporting 

Malta Financial Institution may rely on:

(1) Information collected and maintained pursuant to 

AML/KYC Procedures in the case of a Preexisting Entity Account 

held by one or more NFFEs with an account balance or value that 

does not exceed $1,000,000; or

(2) A self-certification (which may be on an IRS Form W-8 or 

W-9, or on a similar agreed form) from the Account Holder or 

such Controlling Person in the case of a Preexisting Entity Account 

held by one or more NFFEs with an account balance or value that 

exceeds $1,000,000.

d) If any Controlling Person of a Passive NFFE is a U.S. citizen or 

resident, the account shall be treated as a U.S. Reportable Account.

E. Timing of Review and Additional Procedures Applicable to Preexisting 

Entity Accounts.

1. Review of Preexisting Entity Accounts with an account balance or value 

that exceeds $250,000 as of June 30, 2014, must be completed by June 30, 2016.

2. Review of Preexisting Entity Accounts with an account balance or value 

that does not exceed $250,000 as of June 30, 2014, but exceeds $1,000,000 as of 

December 31 of 2015 or any subsequent year, must be completed within six 

months after the last day of the calendar year in which the account balance or 

value exceeds $1,000,000.
32

3. If there is a change of circumstances with respect to a Preexisting Entity 

Account that causes the Reporting Malta Financial Institution to know, or have 

reason to know, that the self-certification or other documentation associated with 

an account is incorrect or unreliable, the Reporting Malta Financial Institution 

must redetermine the status of the account in accordance with the procedures set 

forth in paragraph D of this section.

V. New Entity Accounts. The following rules and procedures apply for purposes of 

identifying U.S. Reportable Accounts and accounts held by Nonparticipating Financial 

Institutions among Financial Accounts held by Entities and opened on or after July 1, 2014 

(“New Entity Accounts”).

A. Entity Accounts Not Required to Be Reviewed, Identified or Reported. 

Unless the Reporting Malta Financial Institution elects otherwise, either with respect to 

all New Entity Accounts or, separately, with respect to any clearly identified group of 

such accounts, where the implementing rules in Malta provide for such election, a credit 

card account or a revolving credit facility treated as a New Entity Account is not required 

to be reviewed, identified, or reported, provided that the Reporting Malta Financial 

Institution maintaining such account implements policies and procedures to prevent an 

account balance owed to the Account Holder that exceeds $50,000. 

B. Other New Entity Accounts. With respect to New Entity Accounts not described 

in paragraph A of this section, the Reporting Malta Financial Institution must determine 

whether the Account Holder is: (i) a Specified U.S. Person; (ii) a Malta Financial 

Institution or other Partner Jurisdiction Financial Institution; (iii) a participating FFI, a 

deemed-compliant FFI, or an exempt beneficial owner, as those terms are defined in 

relevant U.S. Treasury Regulations; or (iv) an Active NFFE or Passive NFFE.

1. Subject to subparagraph B(2) of this section, a Reporting Malta Financial 

Institution may determine that the Account Holder is an Active NFFE, a Malta 

Financial Institution, or other Partner Jurisdiction Financial Institution if the 

Reporting Malta Financial Institution reasonably determines that the Account 

Holder has such status on the basis of the Account Holder’s Global Intermediary 

Identification Number or other information that is publicly available or in the 

possession of the Reporting Malta Financial Institution, as applicable.

2. If the Account Holder is a Malta Financial Institution or other Partner 

Jurisdiction Financial Institution treated by the IRS as a Nonparticipating 

Financial Institution, then the account is not a U.S. Reportable Account, but 

payments to the Account Holder must be reported as contemplated in 

subparagraph 1(b) of Article 4 of the Agreement.

3. In all other cases, a Reporting Malta Financial Institution must obtain a 

self-certification from the Account Holder to establish the Account Holder’s 

status. Based on the self-certification, the following rules apply:
33

a) If the Account Holder is a Specified U.S. Person, the Reporting 

Malta Financial Institution must treat the account as a U.S. Reportable 

Account.

b) If the Account Holder is a Passive NFFE, the Reporting Malta 

Financial Institution must identify the Controlling Persons as determined 

under AML/KYC Procedures, and must determine whether any such 

person is a U.S. citizen or resident on the basis of a self-certification from 

the Account Holder or such person. If any such person is a U.S. citizen or 

resident, the Reporting Malta Financial Institution must treat the account 

as a U.S. Reportable Account.

c) If the Account Holder is: (i) a U.S. Person that is not a Specified 

U.S. Person; (ii) subject to subparagraph B(3)(d) of this section, a Malta 

Financial Institution or other Partner Jurisdiction Financial Institution; (iii) 

a participating FFI, a deemed-compliant FFI, or an exempt beneficial 

owner, as those terms are defined in relevant U.S. Treasury Regulations; 

(iv) an Active NFFE; or (v) a Passive NFFE none of the Controlling 

Persons of which is a U.S. citizen or resident, then the account is not a 

U.S. Reportable Account, and no reporting is required with respect to the 

account.

d) If the Account Holder is a Nonparticipating Financial Institution 

(including a Malta Financial Institution or other Partner Jurisdiction 

Financial Institution treated by the IRS as a Nonparticipating Financial 

Institution), then the account is not a U.S. Reportable Account, but 

payments to the Account Holder must be reported as contemplated in 

subparagraph 1(b) of Article 4 of the Agreement.

VI. Special Rules and Definitions. The following additional rules and definitions apply in 

implementing the due diligence procedures described above:

A. Reliance on Self-Certifications and Documentary Evidence. A Reporting 

Malta Financial Institution may not rely on a self-certification or documentary evidence if 

the Reporting Malta Financial Institution knows or has reason to know that the selfcertification or documentary evidence is incorrect or unreliable.

B. Definitions. The following definitions apply for purposes of this Annex I.

1. AML/KYC Procedures. “AML/KYC Procedures” means the customer 

due diligence procedures of a Reporting Malta Financial Institution pursuant to 

the anti-money laundering or similar requirements of Malta to which such 

Reporting Malta Financial Institution is subject.
34

2. NFFE. An “NFFE” means any Non-U.S. Entity that is not an FFI as 

defined in relevant U.S. Treasury Regulations or is an Entity described in 

subparagraph B(4)(j) of this section, and also includes any Non-U.S. Entity that is 

established in Malta or another Partner Jurisdiction and that is not a Financial 

Institution.

3. Passive NFFE. A “Passive NFFE” means any NFFE that is not (i) an 

Active NFFE or (ii) a withholding foreign partnership or withholding foreign trust 

pursuant to relevant U.S. Treasury Regulations.

4. Active NFFE. An “Active NFFE” means any NFFE that meets any of the 

following criteria:

a) Less than 50 percent of the NFFE’s gross income for the preceding 

calendar year or other appropriate reporting period is passive income and 

less than 50 percent of the assets held by the NFFE during the preceding 

calendar year or other appropriate reporting period are assets that produce 

or are held for the production of passive income;

b) The stock of the NFFE is regularly traded on an established 

securities market or the NFFE is a Related Entity of an Entity the stock of 

which is regularly traded on an established securities market;

c) The NFFE is organized in a U.S. Territory and all of the owners of 

the payee are bona fide residents of that U.S. Territory;

d) The NFFE is a government (other than the U.S. government), a 

political subdivision of such government (which, for the avoidance of 

doubt, includes a state, province, county, or municipality), or a public 

body performing a function of such government or a political subdivision 

thereof, a government of a U.S. Territory, an international organization, a 

non-U.S. central bank of issue, or an Entity wholly owned by one or more 

of the foregoing;

e) Substantially all of the activities of the NFFE consist of holding (in 

whole or in part) the outstanding stock of, or providing financing and 

services to, one or more subsidiaries that engage in trades or businesses 

other than the business of a Financial Institution, except that an NFFE 

shall not qualify for this status if the NFFE functions (or holds itself out) 

as an investment fund, such as a private equity fund, venture capital fund, 

leveraged buyout fund, or any investment vehicle whose purpose is to 

acquire or fund companies and then hold interests in those companies as 

capital assets for investment purposes;

f) The NFFE is not yet operating a business and has no prior 

operating history, but is investing capital into assets with the intent to 
35

operate a business other than that of a Financial Institution provided that 

the NFFE shall not qualify for this exception after the date that is 24 

months after the date of the initial organization of the NFFE;

g) The NFFE was not a Financial Institution in the past five years, 

and is in the process of liquidating its assets or is reorganizing with the 

intent to continue or recommence operations in a business other than that 

of a Financial Institution;

h) The NFFE primarily engages in financing and hedging transactions 

with, or for, Related Entities that are not Financial Institutions, and does 

not provide financing or hedging services to any Entity that is not a 

Related Entity, provided that the group of any such Related Entities is 

primarily engaged in a business other than that of a Financial Institution; 

i) The NFFE is an “excepted NFFE” as described in relevant U.S. 

Treasury Regulations; or

j) The NFFE meets all of the following requirements:

i. It is established and operated in its jurisdiction of residence 

exclusively for religious, charitable, scientific, artistic, cultural, 

athletic, or educational purposes; or it is established and 

operated in its jurisdiction of residence and it is a professional 

organization, business league, chamber of commerce, labor 

organization, agricultural or horticultural organization, civic 

league or an organization operated exclusively for the 

promotion of social welfare;

ii. It is exempt from income tax in its jurisdiction of residence;

iii. It has no shareholders or members who have a proprietary or 

beneficial interest in its income or assets;

iv. The applicable laws of the NFFE’s jurisdiction of residence or 

the NFFE’s formation documents do not permit any income or 

assets of the NFFE to be distributed to, or applied for the 

benefit of, a private person or non-charitable Entity other than 

pursuant to the conduct of the NFFE’s charitable activities, or 

as payment of reasonable compensation for services rendered, 

or as payment representing the fair market value of property 

which the NFFE has purchased; and

v. The applicable laws of the NFFE’s jurisdiction of residence or 

the NFFE’s formation documents require that, upon the 

NFFE’s liquidation or dissolution, all of its assets be 
36

distributed to a governmental entity or other non-profit 

organization, or escheat to the government of the NFFE’s 

jurisdiction of residence or any political subdivision thereof.

5. Preexisting Account. A “Preexisting Account” means a Financial

Account maintained by a Reporting Financial Institution as of June 30, 2014.

C. Account Balance Aggregation and Currency Translation Rules.

1. Aggregation of Individual Accounts. For purposes of determining the 

aggregate balance or value of Financial Accounts held by an individual, a 

Reporting Malta Financial Institution is required to aggregate all Financial 

Accounts maintained by the Reporting Malta Financial Institution, or by a Related 

Entity, but only to the extent that the Reporting Malta Financial Institution’s 

computerized systems link the Financial Accounts by reference to a data element 

such as client number or taxpayer identification number, and allow account 

balances or values to be aggregated. Each holder of a jointly held Financial 

Account shall be attributed the entire balance or value of the jointly held Financial 

Account for purposes of applying the aggregation requirements described in this 

paragraph 1.

2. Aggregation of Entity Accounts. For purposes of determining the 

aggregate balance or value of Financial Accounts held by an Entity, a Reporting 

Malta Financial Institution is required to take into account all Financial Accounts 

that are maintained by the Reporting Malta Financial Institution, or by a Related 

Entity, but only to the extent that the Reporting Malta Financial Institution’s 

computerized systems link the Financial Accounts by reference to a data element 

such as client number or taxpayer identification number, and allow account 

balances or values to be aggregated.

3. Special Aggregation Rule Applicable to Relationship Managers. For 

purposes of determining the aggregate balance or value of Financial Accounts 

held by a person to determine whether a Financial Account is a High Value 

Account, a Reporting Malta Financial Institution is also required, in the case of 

any Financial Accounts that a relationship manager knows, or has reason to know, 

are directly or indirectly owned, controlled, or established (other than in a 

fiduciary capacity) by the same person, to aggregate all such accounts.

4. Currency Translation Rule. For purposes of determining the balance or 

value of Financial Accounts denominated in a currency other than the U.S. dollar, 

a Reporting Malta Financial Institution must convert the U.S. dollar threshold 

amounts described in this Annex I into such currency using a published spot rate 

determined as of the last day of the calendar year preceding the year in which the 

Reporting Malta Financial Institution is determining the balance or value.
37

D. Documentary Evidence. For purposes of this Annex I, acceptable documentary 

evidence includes any of the following:

1. A certificate of residence issued by an authorized government body (for 

example, a government or agency thereof, or a municipality) of the jurisdiction in 

which the payee claims to be a resident.

2. With respect to an individual, any valid identification issued by an 

authorized government body (for example, a government or agency thereof, or a 

municipality), that includes the individual’s name and is typically used for 

identification purposes.

3. With respect to an Entity, any official documentation issued by an 

authorized government body (for example, a government or agency thereof, or a 

municipality) that includes the name of the Entity and either the address of its 

principal office in the jurisdiction (or U.S. Territory) in which it claims to be a 

resident or the jurisdiction (or U.S. Territory) in which the Entity was 

incorporated or organized.

4. With respect to a Financial Account maintained in a jurisdiction with antimoney laundering rules that have been approved by the IRS in connection with a 

QI agreement (as described in relevant U.S. Treasury Regulations), any of the 

documents, other than a Form W-8 or W-9, referenced in the jurisdiction’s 

attachment to the QI agreement for identifying individuals or Entities.

5. Any financial statement, third-party credit report, bankruptcy filing, or 

U.S. Securities and Exchange Commission report.

E. Alternative Procedures for Financial Accounts Held by Individual 

Beneficiaries of a Cash Value Insurance Contract. A Reporting Malta Financial 

Institution may presume that an individual beneficiary (other than the owner) of a Cash 

Value Insurance Contract receiving a death benefit is not a Specified U.S. Person and 

may treat such Financial Account as other than a U.S. Reportable Account unless the 

Reporting Malta Financial Institution has actual knowledge, or reason to know, that the 

beneficiary is a Specified U.S. Person. A Reporting Malta Financial Institution has reason 

to know that a beneficiary of a Cash Value Insurance Contract is a Specified U.S. Person 

if the information collected by the Reporting Malta Financial Institution and associated 

with the beneficiary contains U.S. indicia as described in subparagraph (B)(1) of section 

II of this Annex I. If a Reporting Malta Financial Institution has actual knowledge, or 

reason to know, that the beneficiary is a Specified U.S. Person, the Reporting Malta 

Financial Institution must follow the procedures in subparagraph (B)(3) of section II of 

this Annex I.

F. Reliance on Third Parties. Regardless of whether an election is made under 

paragraph C of section I of this Annex I, Malta may permit Reporting Malta Financial 
38

Institutions to rely on due diligence procedures performed by third parties, to the extent 

provided in relevant U.S. Treasury Regulations.
39

ANNEX II

The following Entities are treated as exempt beneficial owners or deemed-compliant FFIs, as the 

case may be, and the following accounts are excluded from the definition of Financial Accounts.

This Annex II may be modified by a mutual agreement entered into between the Competent 

Authorities of Malta and the United States: (1) to include additional Entities and accounts that 

present a low risk of being used by U.S. Persons to evade U.S. tax and that have similar 

characteristics to the Entities and accounts described in this Annex II as of the date of signature 

of the Agreement; or (2) to remove Entities and accounts that, due to changes in circumstances, 

no longer present a low risk of being used by U.S. Persons to evade U.S. tax. Any such addition 

or removal shall be effective on the date of signature of the mutual agreement, unless otherwise 

provided therein. Procedures for reaching such a mutual agreement may be included in the 

mutual agreement described in paragraph 6 of Article 3 of the Agreement.

I. Exempt Beneficial Owners other than Funds. The following Entities are treated as 

Non-Reporting Malta Financial Institutions and as exempt beneficial owners for purposes 

of sections 1471 and 1472 of the U.S. Internal Revenue Code, other than with respect to 

a payment that is derived from an obligation held in connection with a commercial 

financial activity of a type engaged in by a Specified Insurance Company, Custodial 

Institution, or Depository Institution.

A. Governmental Entity. The government of Malta, any political subdivision of Malta 

(which, for the avoidance of doubt, includes a state, province, county, or 

municipality), or any wholly owned agency or instrumentality of Malta or any one or 

more of the foregoing (each, a “Malta Governmental Entity”). This category is 

comprised of the integral parts, controlled entities, and political subdivisions of 

Malta.

1. An integral part of Malta means any person, organization, agency, bureau, fund, 

instrumentality, or other body, however designated, that constitutes a governing 

authority of Malta. The net earnings of the governing authority must be credited 

to its own account or to other accounts of Malta, with no portion inuring to the 

benefit of any private person. An integral part does not include any individual 

who is a sovereign, official, or administrator acting in a private or personal 

capacity. 

2. A controlled entity means an Entity that is separate in form from Malta or that 

otherwise constitutes a separate juridical entity, provided that:

a) The Entity is wholly owned and controlled by one or more Malta

Governmental Entities directly or through one or more controlled entities; 

b) The Entity’s net earnings are credited to its own account or to the accounts of 

one or more Malta Governmental Entities, with no portion of its income 

inuring to the benefit of any private person; and 
40

c) The Entity’s assets vest in one or more Malta Governmental Entities upon 

dissolution. 

3. Income does not inure to the benefit of private personsif such persons are the 

intended beneficiaries of a governmental program, and the program activities are 

performed for the general public with respect to the common welfare or relate to 

the administration of some phase of government. Notwithstanding the foregoing, 

however, income is considered to inure to the benefit of private persons if the 

income is derived from the use of a governmental entity to conduct a commercial 

business, such as a commercial banking business, that provides financial services 

to private persons.

B. International Organization. Any international organization or wholly owned 

agency or instrumentality thereof. This category includes any intergovernmental 

organization (including a supranational organization) (1) that is comprised primarily 

of non-U.S. governments; (2) that has in effect a headquarters agreement with Malta; 

and (3) the income of which does not inure to the benefit of private persons.

C. Central Bank. An institution that is by law or government sanction the principal 

authority, other than the government of Malta itself, issuing instruments intended to 

circulate as currency. Such an institution may include an instrumentality that is 

separate from the government of Malta, whether or not owned in whole or in part by 

Malta.

II. Funds that Qualify as Exempt Beneficial Owners. The following Entities are treated 

as Non-Reporting Malta Financial Institutions and as exempt beneficial owners for 

purposes of sections 1471 and 1472 of the U.S. Internal Revenue Code.

A. Treaty-Qualified Retirement Fund. A fund established in Malta, provided that the 

fund is entitled to benefits under an income tax treaty between Malta and the United 

States on income that it derives from sources within the United States (or would be 

entitled to such benefits if it derived any such income) as a resident of Malta that 

satisfies any applicable limitation on benefits requirement, and is operated principally 

to administer or provide pension or retirement benefits.

B. Broad Participation Retirement Fund. A fund established in Malta to provide 

retirement, disability, or death benefits, or any combination thereof, to beneficiaries 

that are current or former employees (or persons designated by such employees) of 

one or more employers in consideration for services rendered, provided that the fund:

1. Does not have a single beneficiary with a right to more than five percent of the 

fund’s assets; 

2. Is subject to government regulation and provides annual information reporting 

about its beneficiaries to the relevant tax authorities in Malta; and 
41

3. Satisfies at least one of the following requirements: 

a) The fund is generally exempt from tax in Malta on investment income under 

the laws of Malta due to its status as a retirement or pension plan; 

b) The fund receives at least 50 percent of its total contributions (other than 

transfers of assets from other plans described in paragraphs A through D of 

this section or from retirement and pension accounts described in 

subparagraph A(1) of section V of this Annex II) from the sponsoring 

employers; 

c) Distributions or withdrawals from the fund are allowed only upon the 

occurrence of specified events related to retirement, disability, or death 

(except rollover distributions to other retirement funds described in 

paragraphs A through D of this section or retirement and pension accounts 

described in subparagraph A(1) of section V of this Annex II), or penalties 

apply to distributions or withdrawals made before such specified events; or

d) Contributions (other than certain permitted make-up contributions) by 

employees to the fund are limited by reference to earned income of the 

employee or may not exceed $50,000 annually, applying the rules set forth in 

Annex I for account aggregation and currency translation.

C. Narrow Participation Retirement Fund. A fund established in Malta to provide 

retirement, disability, or death benefits to beneficiaries that are current or former 

employees (or persons designated by such employees) of one or more employers in 

consideration for services rendered, provided that:

1. The fund has fewer than 50 participants; 

2. The fund is sponsored by one or more employers that are not Investment Entities 

or Passive NFFEs; 

3. The employee and employer contributions to the fund (other than transfers of 

assets from treaty-qualified retirement funds described in paragraph A of this 

section or retirement and pension accounts described in subparagraph A(1) of 

section V of this Annex II) are limited by reference to earned income and 

compensation of the employee, respectively; 

4. Participants that are not residents of Malta are not entitled to more than 20 percent 

of the fund’s assets; and 

5. The fund is subject to government regulation and provides annual information 

reporting about its beneficiaries to the relevant tax authorities in Malta.
42

D. Pension Fund of an Exempt Beneficial Owner. A fund established in Malta by an 

exempt beneficial owner to provide retirement, disability, or death benefits to 

beneficiaries or participants that are current or former employees of the exempt 

beneficial owner (or persons designated by such employees), or that are not current or 

former employees, if the benefits provided to such beneficiaries or participants are in 

consideration of personal services performed for the exempt beneficial owner.

E. Investment Entity Wholly Owned by Exempt Beneficial Owners. An Entity that 

is a Malta Financial Institution solely because it is an Investment Entity, provided that 

each direct holder of an Equity Interest in the Entity is an exempt beneficial owner, 

and each direct holder of a debt interest in such Entity is either a Depository 

Institution (with respect to a loan made to such Entity) or an exempt beneficial owner.

 

III. Small or Limited Scope Financial Institutions that Qualify as Deemed-Compliant 

FFIs. The following Financial Institutions are Non-Reporting Malta Financial Institutions 

that are treated as deemed-compliant FFIs for purposes of section 1471 of the U.S. 

Internal Revenue Code:

A. Financial Institutions with a Local Client Base. A Financial Institution satisfying 

the following requirements:

1. The Financial Institution must be licensed and regulated as a financial institution 

under the laws of Malta;

2. The Financial Institution must have no fixed place of business outside of Malta. 

For this purpose, a fixed place of business does not include a location that is not 

advertised to the public and from which the Financial Institution performs solely 

administrative support functions;

3. The Financial Institution must not solicit customers or Account Holders outside 

Malta. For this purpose, a Financial Institution shall not be considered to have 

solicited account holders outside Malta merely because the Financial Institution 

(a) operates a website, provided that the website does not specifically indicate that 

the Financial Institution provides Financial Accounts or services to nonresidents, 

and does not otherwise target or solicit U.S. customers or Account Holders, or (b) 

advertises in print media or on a radio or television station that is distributed or 

aired primarily within Malta but is also incidentally distributed or aired in other 

countries, provided that the advertisement does not specifically indicate that the 

Financial Institution provides Financial Accounts or services to nonresidents, and 

does not otherwise target or solicit U.S. customers or Account Holders;

4. The Financial Institution must be required under the laws of Malta to identify 

resident Account Holders for purposes of either information reporting or 

withholding of tax with respect to Financial Accounts held by residents or for 

purposes of satisfying Malta’s AML due diligence requirements;
43

5. At least 98 percent of the Financial Accounts by value maintained by the 

Financial Institution must be held by residents (including residents that are 

Entities) of Malta or a Member State of the European Union;

6. Beginning on or before July 1, 2014, the Financial Institution must have policies 

and procedures, consistent with those set forth in Annex I, to prevent the 

Financial Institution from providing a Financial Account to any Nonparticipating 

Financial Institution and to monitor whether the Financial Institution opens or 

maintains a Financial Account for any Specified U.S. Person who is not a resident 

of Malta (including a U.S. Person that was a resident of Malta when the Financial 

Account was opened but subsequently ceases to be a resident of Malta) or any 

Passive NFFE with Controlling Persons who are U.S. residents or U.S. citizens 

who are not residents of Malta; 

7. Such policies and procedures must provide that if any Financial Account held by 

a Specified U.S. Person who is not a resident of Malta or by a Passive NFFE with 

Controlling Persons who are U.S. residents or U.S. citizens who are not residents 

of Malta is identified, the Financial Institution must report such Financial Account 

as would be required if the Financial Institution were a Reporting Malta Financial 

Institution (including by following the registration requirementsapplicable to 

Reporting Malta Financial Institutions) or close such Financial Account;

8. With respect to a Preexisting Account held by an individual who is not a resident 

of Malta or by an Entity, the Financial Institution must review those Preexisting 

Accounts in accordance with the procedures set forth in Annex I applicable to 

Preexisting Accounts to identify any U.S. Reportable Account or Financial 

Account held by a Nonparticipating Financial Institution, and must report such 

Financial Account as would be required if the Financial Institution were a 

Reporting Malta Financial Institution (including by following the registration 

requirements applicable to Reporting Malta Financial Institutions) or close such 

Financial Account;

9. Each Related Entity of the Financial Institution that is a Financial Institution must 

be incorporated or organized in Malta and, with the exception of any Related 

Entity that is a retirement fund described in paragraphs A through D of section II 

of this Annex II, satisfy the requirements set forth in this paragraph A; and

10. The Financial Institution must not have policies or practices that discriminate 

against opening or maintaining Financial Accounts for individuals who are 

Specified U.S. Persons and residents of Malta.

B. Local Bank. A Financial Institution satisfying the following requirements:

1. The Financial Institution operates solely as (and is licensed and regulated under 

the laws of Malta as) (a) a bank or (b) a credit union or similar cooperative credit 

organization that is operated without profit;
44

2. The Financial Institution’s business consists primarily of receiving deposits from 

and making loans to, with respect to a bank, unrelated retail customers and, with 

respect to a credit union or similar cooperative credit organization, members, 

provided that no member has a greater than five percent interest in such credit 

union or cooperative credit organization;

3. The Financial Institution satisfies the requirements set forth in subparagraphs 

A(2) and A(3) of this section, provided that, in addition to the limitations on the 

website described in subparagraph A(3) of this section, the website does not 

permit the opening of a Financial Account;

4. The Financial Institution does not have more than $175 million in assets on its 

balance sheet, and the Financial Institution and any Related Entities, taken 

together, do not have more than $500 million in total assets on their consolidated 

or combined balance sheets; and

5. Any Related Entity must be incorporated or organized in Malta, and any Related 

Entity that is a Financial Institution, with the exception of any Related Entity that 

is a retirement fund described in paragraphs A through D of section II of this 

Annex II or a Financial Institution with only low-value accounts described in 

paragraph C of this section, must satisfy the requirements set forth in this 

paragraph B. 

C. Financial Institution with Only Low-Value Accounts. A Malta Financial 

Institution satisfying the following requirements:

1. The Financial Institution is not an Investment Entity;

2. No Financial Account maintained by the Financial Institution or any Related 

Entity has a balance or value in excess of $50,000, applying the rules set forth in 

Annex I for account aggregation and currency translation; and 

3. The Financial Institution does not have more than $50 million in assets on its 

balance sheet, and the Financial Institution and any Related Entities, taken 

together, do not have more than $50 million in total assets on their consolidated or 

combined balance sheets. 

D. Qualified Credit Card Issuer. A Malta Financial Institution satisfying the following 

requirements:

1. The Financial Institution is a Financial Institution solely because it is an issuer of 

credit cards that accepts deposits only when a customer makes a payment in 

excess of a balance due with respect to the card and the overpayment is not 

immediately returned to the customer; and
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2. Beginning on or before July 1, 2014, the Financial Institution implements policies 

and procedures to either prevent a customer deposit in excess of $50,000, or to 

ensure that any customer deposit in excess of $50,000, in each case applying the 

rules set forth in Annex I for account aggregation and currency translation, is 

refunded to the customer within 60 days. For this purpose, a customer deposit 

does not refer to credit balances to the extent of disputed charges but does include 

credit balances resulting from merchandise returns.

IV. Investment Entities that Qualify as Deemed-Compliant FFIs and Other Special 

Rules. The Financial Institutions described in paragraphs A through E of this section are 

Non-Reporting Malta Financial Institutions that are treated as deemed-compliant FFIs for 

purposes of section 1471 of the U.S. Internal Revenue Code. In addition, paragraph F of 

this section provides special rules applicable to an Investment Entity. 

A. Trustee-Documented Trust. A trust established under the laws of Malta to the 

extent that the trustee of the trust is a Reporting U.S. Financial Institution, Reporting 

Model 1 FFI, or Participating FFI and reports all information required to be reported 

pursuant to the Agreement with respect to all U.S. Reportable Accounts of the trust.

B. Sponsored Investment Entity and Controlled Foreign Corporation. A Financial 

Institution described in subparagraph B(1) or B(2) of this section having a sponsoring 

entity that complies with the requirements of subparagraph B(3) of this section. 

1. A Financial Institution is a sponsored investment entity if (a) it is an Investment 

Entity established in Malta that is not a qualified intermediary, withholding 

foreign partnership, or withholding foreign trust pursuant to relevant U.S. 

Treasury Regulations; and (b) an Entity has agreed with the Financial Institution 

to act as a sponsoring entity for the Financial Institution. 

2. A Financial Institution is a sponsored controlled foreign corporation if (a) the 

Financial Institution is a controlled foreign corporation1 organized under the laws 

of Malta that is not a qualified intermediary, withholding foreign partnership, or 

withholding foreign trust pursuant to relevant U.S. Treasury Regulations; (b) the 

Financial Institution is wholly owned, directly or indirectly, by a Reporting U.S. 

Financial Institution that agrees to act, or requires an affiliate of the Financial 

Institution to act, as a sponsoring entity for the Financial Institution; and (c) the 

Financial Institution shares a common electronic account system with the 

sponsoring entity that enables the sponsoring entity to identify all Account 

Holders and payees of the Financial Institution and to access all account and 

 1 A “controlled foreign corporation” means any foreign corporation if more than 50 percent of the total combined 

voting power of all classes of stock of such corporation entitled to vote, or the total value of the stock of such 

corporation, is owned, or is considered as owned, by “United States shareholders” on any day during the taxable 

year of such foreign corporation. The term a “United States shareholder” means, with respect to any foreign 

corporation, a United States person who owns, or is considered as owning, 10 percent or more of the total combined 

voting power of all classes of stock entitled to vote of such foreign corporation.
46

customer information maintained by the Financial Institution including, but not 

limited to, customer identification information, customer documentation, account 

balance, and all payments made to the Account Holder or payee. 

3. The sponsoring entity complies with the following requirements: 

a) The sponsoring entity is authorized to act on behalf of the Financial 

Institution (such as a fund manager, trustee, corporate director, or managing 

partner) to fulfill applicable registration requirements; 

b) The sponsoring entity has registered as a sponsoring entity pursuant to 

applicable registration requirements; 

c) If the sponsoring entity identifies any U.S. Reportable Accounts with respect 

to the Financial Institution, the sponsoring entity registers the Financial 

Institution pursuant to applicable registration requirements on or before the 

later of December 31, 2015 and the date that is 90 days after such a U.S. 

Reportable Account is first identified; 

d) The sponsoring entity agrees to perform, on behalf of the Financial Institution, 

all due diligence, withholding, reporting, and other requirements that the 

Financial Institution would have been required to perform if it were a 

Reporting Malta Financial Institution;

e) The sponsoring entity identifies the Financial Institution and includes the 

identifying number of the Financial Institution (obtained by following 

applicable registration requirements) in all reporting completed on the 

Financial Institution’s behalf; and 

f) The sponsoring entity has not had its status as a sponsor revoked.

C. Sponsored, Closely Held Investment Vehicle. A Malta Financial Institution 

satisfying the following requirements:

1. The Financial Institution is a Financial Institution solely because it is an 

Investment Entity and is not a qualified intermediary, withholding foreign 

partnership, or withholding foreign trust pursuant to relevant U.S. Treasury 

Regulations; 

2. The sponsoring entity is a Reporting U.S. Financial Institution, Reporting Model 

1 FFI, or Participating FFI, is authorized to act on behalf of the Financial 

Institution (such as a professional manager, trustee, or managing partner), and 

agrees to perform, on behalf of the Financial Institution, all due diligence, 

withholding, reporting, and other requirements that the Financial Institution 

would have been required to perform if it were a Reporting Malta Financial 

Institution; 
47

3. The Financial Institution does not hold itself out as an investment vehicle for 

unrelated parties; 

4. Twenty or fewer individuals own all of the debt interests and Equity Interests in 

the Financial Institution (disregarding debt interests owned by Participating FFIs 

and deemed-compliant FFIs and Equity Interests owned by an Entity if that Entity 

owns 100 percent of the Equity Interests in the Financial Institution and is itself a 

sponsored Financial Institution described in this paragraph C); and

5. The sponsoring entity complies with the following requirements: 

a) The sponsoring entity has registered as a sponsoring entity pursuant to 

applicable registration requirements; 

b) The sponsoring entity agrees to perform, on behalf of the Financial Institution, 

all due diligence, withholding, reporting, and other requirements that the 

Financial Institution would have been required to perform if it were a 

Reporting Malta Financial Institution and retains documentation collected 

with respect to the Financial Institution for a period of six years; 

c) The sponsoring entity identifies the Financial Institution in all reporting 

completed on the Financial Institution’s behalf; and

d) The sponsoring entity has not had its status as a sponsor revoked. 

D. Investment Advisors and Investment Managers. An Investment Entity established 

in Malta that is a Financial Institution solely because it (1) renders investment advice 

to, and acts on behalf of, or (2) manages portfolios for, and acts on behalf of, a 

customer for the purposes of investing, managing, or administering funds deposited in 

the name of the customer with a Financial Institution other than a Nonparticipating 

Financial Institution.

E. Collective Investment Vehicle. An Investment Entity established in Malta that is 

regulated as a collective investment vehicle, provided that all of the interests in the 

collective investment vehicle (including debt interests in excess of $50,000) are held 

by or through one or more exempt beneficial owners, Active NFFEs described in 

subparagraph B(4) of section VI of Annex I, U.S. Persons that are not Specified U.S. 

Persons, or Financial Institutions that are not Nonparticipating Financial Institutions. 

F. Special Rules. The following rules apply to an Investment Entity: 

1. With respect to interests in an Investment Entity that is a collective investment 

vehicle described in paragraph E of this section, the reporting obligations of any 

Investment Entity (other than a Financial Institution through which interests in the 

collective investment vehicle are held) shall be deemed fulfilled.

2. With respect to interests in: 
48

a) An Investment Entity established in a Partner Jurisdiction that is regulated as 

a collective investment vehicle, all of the interests in which (including debt 

interests in excess of $50,000) are held by or through one or more exempt 

beneficial owners, Active NFFEs described in subparagraph B(4) of section 

VI of Annex I, U.S. Persons that are not Specified U.S. Persons, or Financial 

Institutions that are not Nonparticipating Financial Institutions; or

b) An Investment Entity that is a qualified collective investment vehicle under 

relevant U.S. Treasury Regulations; 

the reporting obligations of any Investment Entity that is a Malta Financial 

Institution (other than a Financial Institution through which interests in the 

collective investment vehicle are held) shall be deemed fulfilled.

3. With respect to interests in an Investment Entity established in Malta that is not 

described in paragraph E of subparagraph F(2) of this section, consistent with 

paragraph 3 of Article 5 of the Agreement, the reporting obligations of all other 

Investment Entities with respect to such interests shall be deemed fulfilled if the 

information required to be reported by the first-mentioned Investment Entity

pursuant to the Agreement with respect to such interests is reported by such 

Investment Entity or another person.

4. An Investment Entity established in Malta that is regulated as a collective 

investment vehicle shall not fail to qualify under paragraph E or subparagraph 

F(2) of this section, or otherwise as a deemed-compliant FFI, solely because the 

collective investment vehicle has issued physical shares in bearer form, provided 

that: 

a) The collective investment vehicle has not issued, and does not issue, any 

physical shares in bearer form after December 31, 2012;

b) The collective investment vehicle retires all such shares upon surrender;

c) The collective investment vehicle (or a Reporting Malta Financial 

Institution) performs the due diligence procedures set forth in Annex I and 

reports any information required to be reported with respect to any such 

shares when such shares are presented for redemption or other payment; and

d) The collective investment vehicle has in place policies and procedures to 

ensure that such shares are redeemed or immobilized as soon as possible, 

and in any event prior to January 1, 2017.

V. Accounts Excluded from Financial Accounts. The following accounts are excluded from 

the definition of Financial Accounts and therefore are not treated as U.S. Reportable Accounts. 

A. Certain Savings Accounts. 
49

1. Retirement and Pension Account. A retirement or pension account maintained in 

Malta that satisfies the following requirements under the laws of Malta.

a) The account is subject to regulation as a personal retirement account or is part 

of a registered or regulated retirement or pension plan for the provision of 

retirement or pension benefits (including disability or death benefits);

b) The account is tax-favored (i.e., contributions to the account that would 

otherwise be subject to tax under the laws of Malta are deductible or excluded 

from the gross income of the account holder or taxed at a reduced rate, or 

taxation of investment income from the account is deferred or taxed at a 

reduced rate);

c) Annual information reporting is required to the tax authorities in Malta with 

respect to the account;

d) Withdrawals are conditioned on reaching a specified retirement age, 

disability, or death, or penalties apply to withdrawals made before such 

specified events; and

e) Either (i) annual contributions are limited to $50,000 or less, or (ii) there is a 

maximum lifetime contribution limit to the account of $1,000,000 or less, in 

each case applying the rules set forth in Annex I for account aggregation and 

currency translation.

2. Non-Retirement Savings Accounts. An account maintained in Malta (other than 

an insurance or Annuity Contract) that satisfies the following requirements under 

the laws of Malta.

a) The account is subject to regulation as a savings vehicle for purposes other 

than for retirement;

b) The account is tax-favored (i.e., contributions to the account that would 

otherwise be subject to tax under the laws of Malta are deductible or excluded 

from the gross income of the account holder or taxed at a reduced rate, or 

taxation of investment income from the account is deferred or taxed at a 

reduced rate);

c) Withdrawals are conditioned on meeting specific criteria related to the 

purpose of the savings account (for example, the provision of educational or 

medical benefits), or penalties apply to withdrawals made before such criteria 

are met; and

d) Annual contributions are limited to $50,000 or less, applying the rules set 

forth in Annex I for account aggregation and currency translation.
50

B. Certain Term Life Insurance Contracts. A life insurance contract maintained in 

Malta with a coverage period that will end before the insured individual attains age 

90, provided that the contract satisfies the following requirements:

 1. Periodic premiums, which do not decrease over time, are payable at least

annually during the period the contract is in existence or until the insured attains 

age 90, whichever is shorter;

 2. The contract has no contract value that any person can access (by withdrawal, 

loan, or otherwise) without terminating the contract;

 3. The amount (other than a death benefit) payable upon cancellation or termination 

of the contract cannot exceed the aggregate premiums paid for the contract, less 

the sum of mortality, morbidity, and expense charges (whether or not actually 

imposed) for the period or periods of the contract’s existence and any amounts 

paid prior to the cancellation or termination of the contract; and

 4. The contract is not held by a transferee for value.

C. Account Held By an Estate. An account maintained in Malta that is held solely by an 

estate if the documentation for such account includes a copy of the deceased’s will or 

death certificate.

D. Escrow Accounts. An account maintained in Malta established in connection with any 

of the following:

1. A court order or judgment.

2. A sale, exchange, or lease of real or personal property, provided that the account 

satisfies the following requirements:

a) The account is funded solely with a down payment, earnest money, deposit in 

an amount appropriate to secure an obligation directly related to the 

transaction, or a similar payment, or is funded with a financial asset that is 

deposited in the account in connection with the sale, exchange, or lease of the 

property; 

b) The account is established and used solely to secure the obligation of the 

purchaser to pay the purchase price for the property, the seller to pay any 

contingent liability, or the lessor or lessee to pay for any damages relating to 

the leased property as agreed under the lease;

c) The assets of the account, including the income earned thereon, will be paid or 

otherwise distributed for the benefit of the purchaser, seller, lessor, or lessee 

(including to satisfy such person’s obligation) when the property is sold, 

exchanged, or surrendered, or the lease terminates;
51

d) The account is not a margin or similar account established in connection with 

a sale or exchange of a financial asset; and

e) The account is not associated with a credit card account. 

3. An obligation of a Financial Institution servicing a loan secured by real property 

to set aside a portion of a payment solely to facilitate the payment of taxes or 

insurance related to the real property at a later time.

4. An obligation of a Financial Institution solely to facilitate the payment of taxes at

a later time.

E. Partner Jurisdiction Accounts. An account maintained in Malta and excluded from 

the definition of Financial Account under an agreement between the United States 

and another Partner Jurisdiction to facilitate the implementation of FATCA, provided 

that such account is subject to the same requirements and oversight under the laws of 

such other Partner Jurisdiction as if such account were established in that Partner 

Jurisdiction and maintained by a Partner Jurisdiction Financial Institution in that 

Partner Jurisdiction.

VI. Definitions. The following additional definitions apply to the descriptions above:

A. Reporting Model 1 FFI. The term Reporting Model 1 FFI means a Financial 

Institution with respect to which a non-U.S. government or agency thereof agrees to 

obtain and exchange information pursuant to a Model 1 IGA, other than a Financial 

Institution treated as a Nonparticipating Financial Institution under the Model 1 IGA. 

For purposes of this definition, the term Model 1 IGA means an arrangement between 

the United States or the Treasury Department and a non-U.S. government or one or 

more agencies thereof to implement FATCA through reporting by Financial 

Institutions to such non-U.S. government or agency thereof, followed by automatic 

exchange of such reported information with the IRS. 

B. Participating FFI. The term Participating FFI means a Financial Institution that has 

agreed to comply with the requirements of an FFI Agreement, including a Financial 

Institution described in a Model 2 IGA that has agreed to comply with the 

requirements of an FFI Agreement. The term Participating FFI also includes a 

qualified intermediary branch of a Reporting U.S. Financial Institution, unless such 

branch is a Reporting Model 1 FFI. For purposes of this definition, the term FFI 

Agreement means an agreement that sets forth the requirements for a Financial 

Institution to be treated as complying with the requirements of section 1471(b) of the 

U.S. Internal Revenue Code. In addition, for purposes of this definition, the term 

Model 2 IGA means an arrangement between the United States or the Treasury 

Department and a non-U.S. government or one or more agencies thereof to facilitate 

the implementation of FATCA through reporting by Financial Institutions directly to 

the IRS in accordance with the requirements of an FFI Agreement, supplemented by 
52

the exchange of information between such non-U.S. government or agency thereof 

and the IRS.