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AGREEMENT BETWEEN THE COMPETENT AUTHORITY OF THE UNITED STATES OF 

AMERICA AND THE COMPETENT AUTHORITY OF THE UNITED KINGDOM OF 

GREAT BRITAIN AND NORTHERN IRELAND TO UPDATE ANNEX II OF THE 

AGREEMENT BETWEEN THE GOVERNMENT OF THE UNITED STATES OF AMERICA 

AND THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND 

NORTHERN IRELAND TO IMPROVE INTERNATIONAL TAX COMPLIANCE AND TO 

IMPLEMENT FATCA

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

Government of the United Kingdom of Great Britain and Northern Ireland to Improve 

International Tax Compliance and to Implement FATCA, signed on September 12, 2012, as 

amended by the exchange of notes of June 3 and 7, 2013 (the “IGA”) provides: “This Annex II 

may be updated by a mutual agreement entered into between the Competent Authorities of the 

United Kingdom and the United States: (1) to include additional entities, accounts, and products 

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 identified in this Annex II as of the date of entry into force of the 

Agreement....” The Competent Authority of the United States of America and the Competent 

Authority of the United Kingdom of Great Britain and Northern Ireland (the “Competent 

Authorities”) hereby enter into the following agreement (the “Agreement”). Terms used in this 

Agreement that are not defined herein have the same meanings as in the IGA. 

1. The Competent Authorities agree to update Annex II of the IGA by adding new subsections

“E” and “F” to Section II (Deemed-Compliant Financial Institutions) of Annex II of the IGA

to include additional entities as Non-Reporting United Kingdom Financial Institutions that 

are treated as deemed-compliant FFIs for purposes of section 1471 of the Internal Revenue 

Code.

“E. Sponsored Investment Entity and Controlled Foreign Corporation. A Financial 

Institution described in subparagraph E(1) or E(2) of this section having a sponsoring 

entity that complies with the requirements of subparagraph E(3) of this section. 

1. A Financial Institution is a sponsored investment entity if (a) it is an Investment 

Entity established in the United Kingdom 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 

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.
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the United Kingdom 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 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 on the IRS FATCA registration 

website; 

b) The sponsoring entity has registered as a sponsoring entity with the IRS on the 

IRS FATCA registration website; 

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 the IRS FATCA registration 

website on or before 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 United 

Kingdom 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 on the IRS FATCA registration website) in all reporting 

completed on the Financial Institution’s behalf; and 

f) The sponsoring entity has not had its status as a sponsor revoked.

F. Sponsored, Closely Held Investment Vehicle. A United Kingdom 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; 
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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 United Kingdom Financial Institution; 

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 F); and

5. The sponsoring entity complies with the following requirements: 

a) The sponsoring entity has registered as a sponsoring entity with the IRS on the 

IRS FATCA registration website; 

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 United 

Kingdom 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. 

2. The Competent Authority of the United Kingdom of Great Britain and Northern Ireland 

shall update the guidance issued by Her Majesty’s Revenue and Customs regarding 

Sponsored Investment Entities and Controlled Foreign Corporations and Sponsored,

Closely Held Investment Vehicles to incorporate the requirements for such entities 

described in paragraph 1 of this Agreement.

3. If an entity has met the requirements of a Sponsored Investment Entity, Sponsored 

Controlled Foreign Corporation, or Sponsored Closely Held Investment Vehicle 

described in Her Majesty’s Revenue and Customs guidance at all relevant times prior to 

the date of this Agreement, the Competent Authority of the United States of America 

shall not determine that such entity is a Reporting United Kingdom Financial Institution 

that is in significant non-compliance with the IGA.
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Signed in duplicate in the English language on

For the Competent Authority of For the Competent Authority of

the United States of America: the United Kingdom of Great Britain and

Northern Ireland:

______________________________

Douglas W. O’Donnell John Shuker

Commissioner, Large Business & Deputy Director, International Collaboration 

International, Internal Revenue Service & Transparency, HM Revenue and Customs

February 14, 2019 February 13, 2019

Date Date

Washington, DC London, UK

Place Place