Botswana

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Overall Phase 2 Rating is Largely Compliant

Table of Determinations and Ratings of the Phase 2 Review

Jurisdictions should ensure that ownership and identity information for all relevant entities and arrangements is available to their competent authorities. (ToR A.1)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Partially Compliant.  Compliance by companies with their annual return filings is particularly low. Compliance with tax return filings is also low. As such, ownership information held by CIPA and BURS may not be accurate.  Botswana should ensure that the monitoring and enforcement of companies’ compliance with annual return filing obligations and tax return obligations is effective. 
The monitoring of compliance with the Financial Intelligence Act and Financial Intelligence Regulations commenced relatively recently, given that the customer due diligence obligations commenced in 2013.  Botswana should also continue to ensure that the customer due diligence obligations are effectively implemented and monitored. 
Jurisdictions should ensure that reliable accounting records are kept for all relevant entities and arrangements. (ToR A.2)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   There is no obligation for any entity to maintain underlying documentation unless they are carrying on a business.  All relevant entities and arrangements should be required to keep accounting records, including underlying documentation, in accordance with the standard. 
Phase 2 Rating Factors Recommendations
Partially Compliant.  Public companies and companies with turnover of more than BWP 10 000 000 (EUR 851 420) file their accounting statements with company’s annual returns. However, compliance with the annual return filing obligation is low. Some accounting information is filed on the tax return. However, the auditing of taxpayers’ accounting records is undertaken on a relatively small number of taxpayers. It is therefore not clear whether accounting records are always available and retained for at least five years.  Botswana should enhance the monitoring and enforcement of the availability of accounting records of these companies and enhance the monitoring of availability of accounting records for tax purposes. 
Companies with turnover of BWP 10 000 000 (EUR 851 420) or less are not required to file financial statements and there is no monitoring by CIPA of the obligation on these companies to maintain accounting records. Some accounting information is filed on the tax return. However, the auditing of taxpayers’ accounting records is undertaken on a relatively small number of taxpayers. It is therefore not clear whether accounting records are always available and retained for at least five years.  Botswana should monitor the availability of accounting records in respect of these companies and enhance the monitoring of availability of accounting records for tax purposes. 
Banking information should be available for all account-holders. (ToR A.3)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.     
Competent authorities should have the power to obtain and provide information that is the subject of a request under an exchange of information arrangement from any person within their territorial jurisdiction who is in possession or control of such information (irrespective of any legal obligation on such person to maintain the secrecy of the information). (ToR B.1)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.     
The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the requested jurisdiction should be compatible with effective exchange of information. (ToR B.2)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.     
Exchange of information mechanisms should provide for effective exchange of information. (ToR C.1)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   A number of agreements signed more than two years ago have not yet been brought into force by Botswana.  Botswana should ensure that its exchange of information mechanisms are brought into force expeditiously. 
Phase 2 Rating Factors Recommendations
Largely Compliant.     
The jurisdictions' network of information exchange mechanisms should cover all relevant partners. (ToR C.2)
Determination Factors Recommendations
The element is in place.     Botswana should continue to develop its EOI network to the standard with all relevant partners. 
Phase 2 Rating Factors Recommendations
Compliant.     
The jurisdictions' mechanisms for exchange of information should have adequate provisions to ensure the confidentiality of information received. (ToR C.3)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.     
The exchange of information mechanisms should respect the rights and safeguards of taxpayers and third parties. (ToR C.4)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.     
The jurisdiction should provide information under its network of agreements in a timely manner. (ToR C.5)
Determination Factors Recommendations
The assessment team is not in a position to evaluate whether this element is in place, as it involves issues of practice that are dealt with in the Phase 2 review.      
Phase 2 Rating Factors Recommendations
Largely Compliant.  Botswana has committed resources and has in place organisational processes for exchange of information that appear to be adequate for dealing with incoming EOI requests. Botswana did not receive any requests during the review period.  Botswana should continue to monitor the practical implementation of the organisational processes of the EOI unit, in particular taking account of any significant changes to the volume of incoming EOI requests, to ensure that they are sufficient for effective EOI in practice. 

Earlier self-assessment based annual reports entitled Tax Co-operation 2010: Towards a Level Playing Field are also available.