Samoa
This report analyses the implementation of the AEOI Standard in Samoa with respect to the requirements of the AEOI Terms of Reference. It assesses both the legal frameworks put in place to implement the AEOI Standard and the effectiveness of the implementation of the AEOI Standard in practice.
The methodology used for the peer reviews and that therefore underpins this report is outlined in Chapter 2.
Overall findings
AEOI legal framework
Samoa’s legal framework implementing the AEOI Standard is in place and is consistent with the requirements of the AEOI Terms of Reference. This includes Samoa’s domestic legislative framework requiring Reporting Financial Institutions to conduct the due diligence and reporting procedures (CR1) and its international legal framework to exchange the information with all of Samoa’s Interested Appropriate Partners (CR2).
Effectiveness of AEOI in practice
Samoa’s implementation of the AEOI Standard is on track with respect to the requirements of the AEOI Terms of Reference to ensure the effectiveness of the AEOI Standard in practice. This includes ensuring Reporting Financial Institutions correctly conduct the due diligence and reporting procedures (CR1) and exchanging the information in an effective and timely manner (CR2). Samoa is encouraged to continue its implementation process accordingly, to ensure its ongoing effectiveness.
Overall rating in relation to the effectiveness in practice: On Track
General context
Samoa commenced exchanges under the AEOI Standard on a non-reciprocal basis in 2018 (i.e. it sends but does not receive information).
In order to provide for Reporting Financial Institutions to collect and report the information to be exchanged, Samoa enacted the Tax Information Exchange Amendment Act 2017, which is an amendment to the Tax Information Exchange Act 2012.
Under this framework Reporting Financial Institutions were required to commence the due diligence procedures in relation to New Accounts from 1 January 2017. With respect to Preexisting Accounts, Reporting Financial Institutions were required to complete the due diligence procedures on High Value Individual Accounts by 31 December 2017 and on Lower Value Individual Accounts and Entity Accounts by 31 December 2018.
With respect to the exchange of information under the AEOI Standard, Samoa is a Party to the Convention on Mutual Administrative Assistance in Tax Matters and activated the associated CRS Multilateral Competent Authority Agreement in time for exchanges in 2018.
Table 1 sets out the number of Financial Institutions in Samoa that reported information on Financial Accounts in 2021 as defined in the AEOI Standard (essentially because they maintained Financial Accounts for Account Holders, or that were related to Controlling Persons, resident in a Reportable Jurisdiction). It also sets out the number of Financial Accounts that they reported in 2021. In this regard, it should be noted that Samoa requires the reporting of Financial Accounts based on a prescribed list of exchange partners and some accounts may be required to be reported more than once (e.g. jointly held accounts or accounts with multiple related Controlling Persons), which is reflected in the figures below. These figures provide key contextual information to the development and implementation of Samoa’s administrative compliance strategy, which is analysed in the subsequent sections of this report.
Table 2 sets out the number of exchange partners to which information was successfully sent by Samoa in the past few years (including where the necessary frameworks were in place, containing an obligation on Reporting Financial Institutions to report information, but no relevant Reportable Accounts were identified). These figures provide key contextual information in relation to Samoa’s exchanges in practice, which is also analysed in subsequent sections of this report.
In order to provide for the effective implementation of the AEOI Standard, in Samoa:
the Ministry of Customs and Revenue (the tax authority) has the responsibility to ensure the effective implementation of the due diligence and reporting obligations by Reporting Financial Institutions and for exchanging the information with Samoa’s exchange partners;
technical solutions necessary to receive and validate the information reported by Reporting Financial Institutions were put in place through the Multi Data Exchange System (MDES), which is an online portal in which all Reporting Financial Institutions are required to open an account to report the information to the Competent Authority. The MDES allows for validation of the data received from Reporting Financial Institutions; and
the Common Transmission System (CTS) is used for the exchange of the information, along with the associated file preparation and encryption requirements.
It should be noted that the review of Samoa’s legal frameworks implementing the AEOI Standard concluded with the determination that Samoa’s domestic and international legal frameworks are In Place. This has been taken into account when reviewing the effectiveness of Samoa’s implementation of the AEOI Standard in practice.
Samoa advised that many of the activities it had planned to carry out for the verification and enforcement of the effective implementation of the AEOI Standard have been impacted by the COVID-19 pandemic that arrived in Samoa in 2022, resulting in a state of emergency being imposed at the beginning of the year.
Findings and conclusions on the legal frameworks
The detailed findings and conclusions on the AEOI legal frameworks for Samoa are below, organised per Core Requirement (CR) and sub-requirement (SR), as extracted from the AEOI Terms of Reference (see Annex C).
CR1 Domestic legal framework: Jurisdictions should have a domestic legislative framework in place that requires all Reporting Financial Institutions to conduct the due diligence and reporting procedures in the CRS, and that provides for the effective implementation of the CRS as set out therein.
Samoa’s domestic legislative framework is in place and contains all of the key aspects of the CRS and its Commentary requiring Reporting Financial Institutions to conduct the due diligence and reporting procedures (SRs 1.1 – 1.3). It also provides for a framework to enforce the requirements (SR 1.4).
SR 1.1 Jurisdictions should define the scope of Reporting Financial Institutions consistently with the CRS.
Samoa has defined the scope of Reporting Financial Institutions in its domestic legislative framework in accordance with the CRS and its Commentary.
SR 1.2 Jurisdictions should define the scope of Financial Accounts and Reportable Accounts consistently with the CRS and incorporate the due diligence procedures to identify them.
Samoa has defined the scope of the Financial Accounts that are required to be reported in its domestic legislative framework and incorporated the due diligence procedures that must be applied to identify them in accordance with the CRS and its Commentary.
SR 1.3 Jurisdictions should incorporate the reporting requirements contained in Section I of the CRS into their domestic legislative framework.
Samoa has incorporated the reporting requirements in its domestic legislative framework in accordance with the CRS and its Commentary.
SR 1.4 Jurisdictions should have a legislative framework in place that allows for the enforcement of the requirements of the CRS in practice.
Samoa has a legislative framework in place to enforce the requirements in accordance with the CRS and its Commentary.
CR2 International legal framework: Jurisdictions should have exchange relationships in effect with all Interested Appropriate Partners as committed to and that provide for the exchange of information in accordance with the Model CAA.
Samoa’s international legal framework to exchange the information is in place, is consistent with the Model CAA and its Commentary and provides for exchange with all of Samoa’s Interested Appropriate Partners (i.e. all jurisdictions that are interested in receiving information from Samoa and that meet the required standard in relation to confidentiality and data safeguards) (SRs 2.1 – 2.3).
SR 2.1 Jurisdictions should have exchange agreements in effect with all Interested Appropriate Partners that permit the automatic exchange of CRS information.
Samoa has exchange agreements that permit the automatic exchange of CRS information in effect with all its Interested Appropriate Partners.
SR 2.2 Such an exchange agreement should be put in place without undue delay, following the receipt of an expression of interest from an Interested Appropriate Partner.
Samoa put in place its exchange agreements without undue delay.
SR 2.3 Jurisdictions should ensure that the exchange agreements in effect provide for the exchange of information in accordance with the requirements of the Model CAA.
Samoa’s exchange agreements provide for the exchange of information in accordance with the requirements of the Model CAA.
Findings and conclusions in relation to effectiveness in practice
The detailed findings and conclusions in relation to effectiveness in practice of AEOI for Samoa are below, organised per Core Requirement (CR) and then per sub-requirement (SR) as extracted from the AEOI Terms of Reference (see Annex C).
CR1 Effectiveness in practice: Jurisdictions should ensure that in practice Reporting Financial Institutions correctly implement the due diligence and reporting procedures, which includes a requirement for jurisdictions to have in place an administrative framework to ensure the effective implementation of the CRS.
Samoa’s implementation of the AEOI Standard is on track with respect to ensuring that Reporting Financial Institutions are correctly conducting the due diligence and reporting procedures and are therefore reporting complete and accurate information. This includes ensuring effectiveness in a domestic context, such as through having an effective administrative compliance framework and related procedures (SR 1.5), and collaborating with exchange partners to ensure effectiveness (SR 1.6). Samoa is encouraged to continue its implementation process to ensure its ongoing effectiveness.
SR 1.5 Jurisdictions should ensure that in practice Reporting Financial Institutions identify the Financial Accounts they maintain, identify the Reportable Accounts among those Financial Accounts, as well as their Account Holders, and where relevant Controlling Persons, by correctly conducting the due diligence procedures and collect and report the required information with respect to each Reportable Account. This includes having in place:
an effective administrative compliance framework to ensure the effective implementation of, and compliance with, the CRS. This framework should:
be based on a strategy that facilitates compliance by Reporting Financial Institutions and which is informed by a risk assessment in respect of the effective implementation of the CRS that takes into account relevant information sources (including third party sources);
include procedures to ensure that Financial Institutions correctly apply the definitions of Reporting Financial Institutions and Non-Reporting Financial Institutions;
include procedures to periodically verify Reporting Financial Institutions’ compliance, conducted by authorities that have adequate powers with respect to the reviewed Reporting Financial Institutions, with procedures to access the records they maintain; and
effective procedures to ensure that Financial Institutions, persons or intermediaries do not circumvent the due diligence and reporting procedures;
effective enforcement mechanisms to address non-compliance by Reporting Financial Institutions;
strong measures to ensure that valid self-certifications are always obtained for New Accounts;
effective procedures to ensure that each, or each type of, jurisdiction-specific Non-Reporting Financial Institution and Excluded Account continue to present a low risk of being used to evade tax; and
effective procedures to follow up with a Reporting Financial Institution when undocumented accounts are reported in order to establish the reasons why such information is being reported.
In order to ensure that Reporting Financial Institutions correctly conduct the due diligence and reporting procedures, Samoa implemented most of the requirements in accordance with expectations. However, an issue was identified. The key findings were as follows:
Samoa implemented an overarching strategy to ensure compliance with the AEOI Standard developed after conducting a risk assessment that took into account a range of relevant information sources, such as information from the financial regulators, information reported by the Reporting Financial Institutions and feedback from exchange partners. Samoa is also planning to expand the information sources it considers in its risk assessment. Samoa’s compliance strategy facilitates compliance and incorporates a credible approach to enforcement. Samoa intends to keep its compliance strategy under review to ensure its effectiveness on an ongoing basis.
Samoa has worked to understand its population of Financial Institutions, including relevant non-regulated entities, utilising various relevant information sources, such as a list of entities from the Central Bank, a list of Trustee Companies from the Samoa International Finance Authority and the Foreign Financial Institution list for FATCA purposes. Samoa is taking action to ensure that Reporting Financial Institutions are classifying themselves correctly under its domestic rules and reporting information as required. Samoa intends to keep its understanding of its Financial Institution population up to date on a routine basis.
The institution responsible for implementing Samoa’s compliance strategy appears to have the necessary powers and resources to discharge its functions. Samoa has allocated staff from other internal divisions of the Ministry of Customs and Revenue to work on exchange of information more generally, although they are not specifically assigned to AEOI. Such an approach appears suited to the small size of Samoa’s financial sector. Some Samoan officials working on compliance related to the AEOI Standard (the Samoan AEOI team) have been trained to be able to perform some of the relevant functions. The Samoan AEOI team has access to IT systems and tools to conduct risk assessments and further training in this regard are planned.
It appears that Samoa effectively enforces the requirements, including through the inspection of records of Reporting Financial Institutions and the application of dissuasive penalties and sanctions for non-compliance. Samoa has performed onsite visits to some Financial Institutions and is currently in the process of analysing the findings of such visits. It has also started to review some self-certifications to verify they are obtained as required. Samoa also plans to follow up with Reporting Financial Institutions reporting undocumented accounts. Samoa does not appear to have a clear strategy to take effective action to address circumvention of the requirements if such circumvention is detected.
It is noted that Samoa does not have a jurisdiction-specific list of Non-Reporting Financial Institutions or Excluded Accounts for ongoing monitoring.
Table 3 provides a summary of the specific activities undertaken, or that are planned to be undertaken, in relation to each of the key parts of the framework described above.
In terms of the Financial Account information collected and sent by Samoa, it was found to include a lower proportion of Tax Identification Numbers with respect to the individuals associated with the accounts when compared to most other jurisdictions. Furthermore, while the collection and reporting of dates of birth is generally higher across jurisdictions, Samoa nevertheless reported a lower rate of collection of dates of birth when compared to other jurisdictions. These are key data points for exchange partners to effectively utilise the information. Samoa reported that no undocumented accounts have been reported so far by its Reporting Financial Institutions and statistics in this regard seem to have been monitored.
More generally, the exchange partners that received a significant number of records from Samoa indicated that they achieved a success rate when matching the information received from Samoa with their taxpayer database that was broadly equivalent to, or better than, what they usually achieve.
Based on these findings it was concluded that, overall, Samoa is meeting expectations in ensuring that Reporting Financial Institutions correctly conduct the due diligence and reporting procedures, including by having in place the required administrative compliance framework and related procedures. It was also noted that there is room for improvement with respect to the lack of procedures to be applied where circumvention is detected. Samoa is therefore encouraged to continue its implementation process accordingly, including by addressing the recommendation made.
Samoa should ensure it has a formalised policy to ensure that, where circumvention of the AEOI Standard is identified, action is taken to address it.
SR 1.6 Jurisdictions should collaborate on compliance and enforcement. This requires jurisdictions to:
use all appropriate measures available under the jurisdiction’s domestic law to address errors or non-compliance notified to the jurisdiction by an exchange partner; and
have in place effective procedures to notify an exchange partner of errors that may have led to incomplete or incorrect information reporting or non-compliance with the due diligence or reporting procedures by a Reporting Financial Institution in the jurisdiction of the exchange partner.
It should be noted that, as Samoa exchanges information on a non-reciprocal basis and does not therefore receive information, it is not required to have in place procedures to notify its exchange partners. SR 1.6 b) has therefore not been assessed in this case.
In order to collaborate on compliance and enforcement, it appears that Samoa implemented all of the requirements in relation to issues notified to them (i.e. under Section 4 of the MCAA or equivalent) in accordance with expectations. While no such notifications have yet been received, Samoa has the necessary systems and procedures to process them as required.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to collaborating with its exchange partners to ensure that Reporting Financial Institutions correctly conduct the due diligence and reporting procedures. Samoa is encouraged to continue its implementation process accordingly, to ensure its ongoing effectiveness.
CR2 Effectiveness in practice: Jurisdictions should exchange the information effectively in practice, in a timely manner, including by sorting, preparing, validating and transmitting it in accordance with the AEOI Standard.
Samoa’s implementation of the AEOI Standard is on track with respect to exchanging the information effectively in practice, including in relation to sorting, preparing and validating the information (SR 2.4), correctly transmitting the information in a timely manner (SRs 2.5 – 2.7) and providing corrections, amendments or additions to the information (SR 2.9). The requirements in relation to the receipt of the information (SR 2.8) have not been assessed as Samoa exchanges information non-reciprocally, so does not receive information. Samoa is encouraged to continue its implementation process accordingly, to ensure its ongoing effectiveness.
SR 2.4 Jurisdictions should sort, prepare and validate the information in accordance with the CRS XML Schema and the associated requirements in the CRS XML Schema User Guide and the File Error and Correction-related validations in the Status Message User Guide (i.e. the 50000 and 80000 range).
Feedback from Samoa’s exchange partners did not raise any specific concerns with respect to their ability to process the information received from Samoa and therefore with respect to Samoa’s implementation of these requirements. More generally, none of Samoa’s exchange partners reported rejecting more than 25% of the files received, due to the technical requirements not being met.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to sorting, preparing and validating the information. Samoa is encouraged to continue its implementation process accordingly, to ensure its ongoing effectiveness.
SR 2.5 Jurisdictions should agree and use, with each exchange partner, transmission methods that meet appropriate minimum standards to ensure the confidentiality and integrity of the data throughout the transmission, including its encryption to a minimum secure standard.
In order to put in place an agreed transmission method that meets appropriate minimum standards in confidentiality, integrity of the data and encryption for use with each of its exchange partners, Samoa linked to the CTS.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to agreeing and using appropriate transmission methods with each of its partners. Samoa is encouraged to continue to ensure the ongoing effectiveness of its implementation.
SR 2.6 Jurisdictions should carry out all exchanges annually within nine months of the end of the calendar year to which the information relates.
Feedback from Samoa’s exchange partners did not raise any concerns with respect to timeliness of the exchanges by Samoa and therefore with respect to Samoa’s implementation of this requirement.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to exchanging the information in a timely manner. Samoa is encouraged to continue to ensure the ongoing effectiveness of its implementation.
SR 2.7 Jurisdictions should send the information in accordance with the agreed transmission methods and encryption standards.
Feedback from Samoa’s exchange partners did not raise any concerns with respect to Samoa’s use of the agreed transmission methods and therefore with Samoa’s implementation of this requirement.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to sending the information in accordance with the agreed transmission methods and encryption standards. Samoa is encouraged to continue to ensure the ongoing effectiveness of its implementation.
SR 2.8 Jurisdictions should have the systems in place to receive information and, once it has been received, should send a status message to the sending jurisdictions in accordance with the CRS Status Message XML Schema and the related User Guide.
It should be noted that, as Samoa exchanges information on a non-reciprocal basis and does not receive information, it is not required to have in place procedures to notify its exchange partners. SR 2.8 has therefore not been assessed in this case.
SR 2.9 Jurisdictions should respond to a notification from an exchange partner as referred to in Section 4 of the Model CAA (which may include Status Messages) in accordance with the timelines set out in the Commentary to Section 4 of the Model CAA. In all other cases, jurisdictions should send corrected, amended or additional information received from a Reporting Financial Institution as soon as possible after it has been received.
Samoa appears ready to respond to notifications and to provide corrected, amended or additional information in a timely manner and no such concerns were raised by Samoa’s exchange partners and therefore with respect to Samoa’s implementation of these requirements.
Based on these findings it was concluded that Samoa is fully meeting expectations in relation to responding to notifications from exchange partners and the sending of corrected, amended or additional information. Samoa is encouraged to continue to ensure the ongoing effectiveness of its implementation.
Assessed jurisdiction’s comments on the assessment of effectiveness in practice
The assessment outlined in this report correctly reflects Samoa’s implementation of AEOI, and we wish to express our appreciation to the Expert Panel for their professionalism and understanding throughout this entire review process.
Samoa’s Competent Authority does recognize the gaps that have been identified in the report and is therefore committed to addressing all recommendations made to ensure that AEOI is successfully implemented, monitored and enforced in Samoa.
We here at the Competent Authority further wish to reaffirm Samoa’s unwavering commitment to its international obligations under the AEOI framework.