This is a continuation of the update in last month's briefing. The exchange of information by the Macau SAR under Law 5/2017 – which established the new regime for the exchange of information with foreign entities on tax matters – may also occur upon a request being received from a foreign country which is a contracting party to an international agreement or convention on double taxation or on prevention of tax evasion. This is, however, subject to reciprocity: the Macau SAR will only process requests received from countries that would admit a similar request if made by the Macau SAR.
This procedure applies to individuals and entities in respect of whom the target information is considered relevant for the purposes of the application or the enforcement of the internal laws of the requesting country, such as the liquidation of income tax in that country. The scope of information which may be subject to reporting is wide and includes information available to the Macau Financial Services Bureau (DSF), but also information in the possession of other Macau public services or entities. It includes information on the identity of holders of corporate bodies and beneficiary stakeholders of collective persons, their accounting and supporting documents, and any other information deemed relevant in the context of each reporting exercise. It also includes information kept by financial and offshore institutions, insurance and reinsurance companies, funds and fund management companies. Reporting by the Macau SAR is, however, limited to information related to the year of the request and to the previous five years.
Aside from this, the Macau SAR may also dismiss a request on the following grounds: (i) reasons of public interest, when the information may reveal public secrets, or compromise public safety and/or public order; (ii) the protection of trade, industrial or professional secrets; and, (iii) the protection of privilege, when the information is related to the communications exchanged between attorneys, solicitors or legal representatives, and their clients, in the context of pending or potential litigation, or the provision of legal advice.
As a rule, the DSF has to inform the relevant individuals or entities as to the contents of the procedure, save when the requesting country states otherwise or when the exchange of information envisages the protection of a particularly relevant public interest.
The Chief Executive is the entity with the competence to decide on the acceptance (or dismissal) of a request for the exchange of information received by Macau SAR. The relevant individuals or entities can challenge such decisions and may seek to suspend the procedure pending final judicial adjudication.
(to be continued)
|João Nuno Riquito |
and Bruno Almeida