The Treasury Deparment and the IRS yesterday released final regulations under the Foreign Account Tax Compliance Act. The regulations:

• Build on
  intergovernmental agreements that foster international cooperation. The Treasury
  Department has collaborated with foreign governments to develop and sign
  intergovernmental agreements that facilitate the effective and efficient
  implementation of FATCA by eliminating legal barriers to participation,
  reducing administrative burdens, and ensuring the participation of all
  non-exempt financial institutions in a partner jurisdiction. In order to
  reduce administrative burdens for financial institutions with operations
  in multiple jurisdictions, the final regulations coordinate the
  obligations for financial institutions under the regulations and the
  intergovernmental agreements.
  
  
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• Phase in the timelines
  for due diligence, reporting and withholding and align them with the
  intergovernmental agreements. The final regulations phase in over an extended
  transition period to provide sufficient time for financial institutions to
  develop necessary systems. In addition, to avoid confusion and unnecessary
  duplicative procedures, the final regulations align the regulatory
  timelines with the timelines prescribed in the intergovernmental
  agreements.

• Expand and clarify the
  scope of payments not subject to withholding. To limit market
  disruption, reduce administrative burdens, and establish certainty, the
  final regulations provide relief from withholding with respect to certain
  grandfathered obligations and certain payments made by non-financial
  entities.

• Refine and clarify the
  treatment of investment entities. To better align the obligations under FATCA with the
  risks posed by certain entities, the final regulations: (1) expand and
  clarify the treatment of certain categories of low-risk institutions, such
  as governmental entities and retirement funds; (2) provide that certain
  investment entities may be subject to being reported on by the FFIs with
  which they hold accounts rather than being required to register as FFIs
  and report to the IRS; and (3) clarify the types of passive investment
  entities that must be identified and reported by financial institutions.

• Clarify the compliance
  and verification obligations of FFIs. The final regulations
  provide more streamlined registration and compliance procedures for groups
  of financial institutions, including commonly managed investment funds,
  and provide additional detail regarding FFIs’ obligations to verify their
  compliance under FATCA.

Updates and further information on FATCA can be found by visiting
the FATCA page at Treasury.gov
or IRS.gov.

Update:  Forbes, IRS Implements FATCA, Ramps Up Tax Evasion Battle