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The Exchange of Tax Information Portal is an initiative of the Global Forum on Transparency and Exchange of Information for Tax Purposes. The Global Forum conducts peer reviews of its member jurisdictions' ability to co-operate with other tax administrations in accordance with the internationally agreed standard. The standard provides for exchange of information on request where it is foreseeably relevant to the administration and enforcement of the domestic tax laws of the requesting jurisdiction. Effective exchange of information requires that jurisdictions ensure information is available, that it can be obtained by the tax authorities and that there are mechanisms in place allowing for the exchange of that information. The Global Forum's peer review process examines both the legal and regulatory aspects of exchange (Phase 1 reviews) and the exchange of information in practice (Phase 2). The EOI Portal will track the development of these peer reviews, including changes that jurisdictions make in response to the Global Forum's recommendations.

Peer Review: Aruba Second Round Review (2018)

This report for Aruba has been published on 15 Oct 2018. You can browse it online below.

Skip directly to the Executive Summary. You may also want to view the tables of determinations and ratings.


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Determinations and Recommendations

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, but certain aspects of the legal implementation of the element need improvement.   NVs are not required to keep identity information on the owners of bearer shares issued prior to 2012. Furthermore, the custodian arrangement for AVVs may not be sufficient.   Aruba should ensure that identity information on the owners of bearer shares in NVs and AVVs issued prior to 2012 is available. 
In the case of foreign trusts administered by Aruban trustees/service providers, the beneficial owners to be identified are those with 25% or more of the capital of a trust or who can exercise effective control over such a legal arrangement (article 1, AML/CFT State Ordinance).   Aruba is recommended to ensure that legal and beneficial ownership information not limited to the 25% threshold is available in all cases in respect of foreign trusts, where Aruban trustees/service providers are involved.  
Only VBAs and AVVs are required to engage an AML obligated service provider and there is no such requirement in respect of NVs. Further there may be situations where the agent for AVVs is not replaced in the event of disengagement by the AVV or the TSP, and the AVV is then without any AML obligated person in Aruba to provide the updated beneficial ownership information.  Aruba is recommended to ensure that all the legal entities are adequately covered by either AML, commercial or tax laws to ensure the availability of legal and beneficial ownership information for all entities at all times.  
Phase 2 Rating Factors Recommendations
Partially Compliant.  Aruba continues to not have a regular system of oversight to monitor compliance with the requirements on NVs, VBAs, partnerships, foundations and trusts to keep and file ownership and identity information. During the review period the inspections/verifications were not adequate to come to any conclusion on whether Aruba ensures the availability of accurate and updated beneficial ownership in practice, particularly in the cases of companies, partnerships and trusts. It is also noted that there are more than 90% inactive AVVs and more than 60% inactive NVs as per the records of the Chamber of Commerce and Industry. Further, the definition in the AML guidance is not fully in line with the standard, indicating a preference for treating managers as the beneficial owners.  Aruba should ensure compliance by all entities with ownership and identity information-keeping and filing requirements. .To ensure continuity of effective exchange of accurate and up-to-date beneficial ownership information, Aruba is recommended to design and implement adequate supervisory programmes to ensure that updated ownership information is available in all cases. 
   
   
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 are no legal obligations for retention of accounts of liquidated, dissolved or struck-off companies.   Aruba is recommended to ensure that accounting records of liquidated, dissolved or struck-off companies are retained for 5 years. 
Phase 2 Rating Factors Recommendations
Partially Compliant.  In the current review period, adverse peer input has been received in respect of the two requests for accounting information sought from Aruba, whereby it could not be provided at all in one case and an avoidable delay occurred owing to lack of compliance by the registered agent in the other case. Further, in the review period there has been only a limited supervision by the Tax Authority as well as the Chamber of Commerce and Industry to ensure the availability of accounting information with all entities (including the dormant companies) and arrangements at all times.   Aruba is recommended to ensure adequate supervision as well as enforcement provisions to ensure the availability of accounting information at all times with all relevant entities and arrangements. 
Banking information should be available for all account-holders. (ToR A.3)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   In respect of trusts, since the definition of beneficial owner sets the threshold at 25% ownership, the requirements under the standards are not met in terms of identifying all the beneficial owners in all cases. Further, the definition in the AML guidance is not fully in line with the standard, indicating a preference for treating managers as the beneficial owners.  Aruba should ensure that beneficial ownership information is available for trusts in all cases.  
Phase 2 Rating Factors Recommendations
Largely 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
Largely Compliant.  In the current review period Aruba did not use its compulsory powers to access and provide the accounting information sought by a partner which has adversely impacted the exchange of information.   Aruba is recommended to use its compulsory powers and make use of dissuasive sanctions in the GTO to ensure effective exchange of information. 
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.      
Phase 2 Rating Factors Recommendations
Compliant.     
The jurisdictions' network of information exchange mechanisms should cover all relevant partners. (ToR C.2)
Determination Factors Recommendations
The element is in place.      
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.   This element involves issues of practice. Accordingly no determination on the legal and regulatory framework has been made.   
Phase 2 Rating Factors Recommendations
Largely Compliant.  Delays have been experienced in answering some EOI requests received during the period under review. In addition, Aruba has not consistently provided status updates to all its treaty partners in relation to requests that cannot be replied within 90 days.   Aruba should systematically provide an update or status report to its EOI partners in situations when the competent authority is unable to provide a substantive response within 90 days.