PUBLIC 13
h. The NFE meets all of these requirements (a “non-profit NFE”):
i. It exists and operates in its jurisdiction of residence exclusively for religious, charitable, scientific, artistic,
cultural, athletic or educational purposes; or it exists and operates in that jurisdiction as a professional
organisation, business league, chamber of commerce, labour organisation, agricultural or horticultural
organisation, civic league or an organisation whose only purpose is to promote social welfare;
ii. It’s 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 NFE’s jurisdiction of residence or the NFE’s formation documents don’t allow the
NFE to distribute any income or assets to, or be applied for the benefit of, a private person or non-charitable
Entity. The exceptions are when it relates to carrying out the NFE’s charitable activities, or when the NFE
needs to pay reasonable compensation for services, or the fair market value of a property it’s bought; and
v. The applicable laws of the NFE’s jurisdiction of residence or the NFE’s formation documents require that, if
the NFE liquidates or dissolves, all of its assets go to a Governmental Entity or other non-profit organisation,
or escheat to the government of the NFE’s jurisdiction of residence or any political subdivision.
Note: Some entities (such as U.S. Territory NFFEs) may qualify for Active NFFE status under FATCA but not Active
NFE status under the CRS.
“Cash Value Insurance Contracts”
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.
“Control”
Generally, the “natural” person (as opposed to organisation) who ultimately has a controlling ownership interest in
the Entity has “control” over it. Typically, that means they own a certain percentage in the Entity, for example, 25%.
Where no natural person (or people) has control of the Entity through ownership interests, the Controlling Person(s)
will be the one(s) who exercise control through other means. Under the CRS, the Reportable Person in these cases
is the senior managing official.
“Controlling Person(s)”
“Controlling Persons” are the person(s) who exercise control over an entity. Where that Entity is a Passive Non-
Financial Entity (“Passive NFE”) then a Financial Institution needs to determine whether or not these Controlling
Persons are Reportable Persons. This definition corresponds to the term “beneficial owner” which the Financial
Action Task Force described in Recommendation 10 of its Recommendations (adopted in February 2012).
In the case of a trust, the Controlling Person(s) are the settlor(s), the trustee(s), the protector(s) (if any), the
beneficiary(ies) or class(es) of beneficiaries, or any other person(s) who has ultimate effective control over the trust,
including through a chain of control or ownership. Under the CRS, the settlor(s), the trustee(s), the protector(s) (if
any), and the beneficiary(ies) or class(es) of beneficiaries are always the Controlling Persons of a trust, regardless
of whether any of them has control over its activities.
Where the settlor(s) of a trust is an Entity then the CRS requires Financial Institutions to also identify the Controlling
Persons of the settlor(s) and when required report them as Controlling Persons of the trust.
In the case of a legal arrangement other than a trust, “Controlling Person(s)” means persons in equivalent or similar
positions.
“Custodial Institution”
The term “Custodial Institution” means any Entity that holds, as a substantial portion of its business, Financial
Assets on behalf of others. It applies when 20% or more of an Entity’s gross income is attributable to the holding of
Financial Assets and related financial services over a certain period. That period is (i) the three years ending 31
December (or the final day of a non-calendar year accounting period) before the year in which the Entity is
determining its status; or (ii) the length of time for which the Entity has existed whichever is shorter.
“Depository Institution”
The term “Depository Institution” means any Entity that accepts deposits in the ordinary course of a banking or
similar business.
“FATCA”
FATCA stands for the Foreign Account Tax Compliance Act provisions. These were enacted into U.S. law on March
18, 2010, as part of the Hiring Incentives to Restore Employment (HIRE) Act. FATCA creates a new information