Following a review of Liechtenstein by the Forum on Transparency and Exchange of Information for Tax Purposes (“Global Forum”), Liechtenstein amended both the AEoI law and the ordinance to implement the recommendations made by the Global Forum (the Liechtenstein Tax Administration has also prepared a newsletter in German on this subject). The most important changes include:
 

• Abolishment of the “opt-in clause”: Until now Liechtenstein entities could choose to qualify as a Financial Institution (“FI”). This so-called “opt-in” clause will be abolished. Entities that have used that option need to be reclassified by 31 December 2021 and inform their account-holding FIs of their new status.
  
  
• “Passive NFE” as the new default status: The AEoI law provides that entities that have not informed account-holding FIs of their AEoI status shall be treated as FIs (which means they will have to comply with the reporting and other obligations under AeoI themselves). This clause will be removed. As of 1 January 2022, Liechtenstein FIs will be obliged to treat entities that have not provided information on their AEoI status as Passive NFEs.
  
  
• New registration requirement for all Reporting FIs: Until now, Reporting Liechtenstein FIs only had to register on the Liechtenstein AEoI portal if they maintained reportable accounts. The new law provides that all Liechtenstein Reporting FIs need to register. However, nil reporting is still not required in Liechtenstein.

Entities that so far have made use of the “opt-in” clause need to revisit their entity classification analysis in 2021. Liechtenstein FIs that maintain financial accounts for such entities and know or have reason to believe that (i) the entity has made use of the “opt-in” clause and (ii) would otherwise not meet the criteria of an FI, need to obtain a new self-certification from the entity by 31 December 2021.

Liechtenstein FIs further need to make sure that Liechtenstein entity account holders that have not communicated an AEoI status by 31 December 2021 are classified as Passive NFEs and reported accordingly.

Liechtenstein trustees and corporate services providers need to ensure that all their entities that are Reporting Liechtenstein FIs are registered on the Liechtenstein AEoI portal immediately once they meet the criteria of a Reporting FI, regardless of whether or not they maintain reportable accounts.

US TIN as a mandatory requirement: Following Q.4.3 of the Liechtenstein FATCA FAQs and the IRS FATCA FAQs General (section Reporting, Q.3), the reporting of a US TIN is mandatory from the year 2020 (to be reported in 2021).

Any Liechtenstein FIs that do not hold a US TIN for their clients should try to obtain this identifier from them as soon as possible. In cases where this is not possible and “AAAAAAAAA” is reported according to the Liechtenstein FATCA FAQs, FIs will need to be able to explain to the IRS why the TIN cannot be obtained. Unless the FI can demonstrate that it has adequate procedures in place to obtain TINs and has made reasonable efforts to obtain the TIN, the IRS may consider this as significant non-compliance. At worst, it could lead to the removal of the FI’s GIIN from the IRS FFI list.