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Bahamas Numbered Acts |
(No. 22 of 2003) |
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AN ACT TO MAKE PROVISIONS |
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AUTHORIZING THE ENFORCEMENT OF |
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CERTAIN OBLIGATIONS OF THE BAHAMAS UNDER AN |
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AGREEMENT ON TAXATION MATTERS |
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SIGNED ON 25TH JANUARY, 2002 AT WASHINGTON D.C. IN |
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THE UNITED STATES OF AMERICA BETWEEN THE |
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GOVERNMENT OF THE BAHAMAS AND |
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THE GOVERNMENT OF THE UNITED STATES OF AMERICA, |
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AND TO PROVIDE FOR OTHER CONNECTED OR |
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INCIDENTAL PURPOSES. |
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(Date of Assent - 22nd December, 2003) |
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Enacted by the Parliament of The Bahamas. |
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1.(1)
This Act may be cited as The
Bahamas and the United States of America Tax Information Exchange
Agreement Act, 2003.
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Short title and commencement. |
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(2)
This Act shall come into force
on the Pt day of January, 2004.
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Interpretation. |
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2.(1)
In this Act -
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"Agreement" means the arrangements between The Bahamas and the United States entered into on 25th January, 2002 at Washington, D. C. in the United States of America by the Government of The Bahamas and the United States Government for the provision of information with respect to taxes and for other matters, the text of which is set forth in the Schedule; |
Schedule. |
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"Article" means Article of the Agreement; |
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"business" means a profession or trade; |
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"civil matter" means an examination, investigation or proceeding relating to United States federal tax administration and enforcement with respect to conduct that does not constitute a criminal tax offence under the laws of the United States that is pending at the time of a request and which relates to a taxable period commencing on or after January 1, 2006; |
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"Competent Authority" means - |
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(a)
in the case of The Bahamas, the
Financial Secretary in the Ministry of Finance; and
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(b)
in the case of the United
States, the Secretary of the Treasury or his delegate;
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"criminal matter" means an examination, investigation or proceeding concerning conduct that constitutes a criminal tax offence under the laws of the United States that is pending at the time of a request and which relates to a taxable period commencing on or after January 1, 2004; |
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"document" includes any book, page, statement, account, writing or record, howsoever recorded or stored; |
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"information" means any fact or statement, in any form, that is foreseeably relevant or material to United States Federal tax administration and enforcement, including (but not limited to) - |
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(a)
the testimony of an individual,
and
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(b)
documents or records;
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"judge" means a Judge of the Supreme Court; |
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"Minister" means the Minister of Finance; |
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"pending matter" has the meaning assigned to it under Article 1; |
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"premises" includes any place whatsoever and any means of transport; |
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"privileged communication" means a communication that - |
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(a)
is a confidential communication,
whether oral or written, passing between -
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(i)
counsel and attorney in his or
her professional capacity and another counsel and attorney in such
capacity; or
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(ii)
a counsel and attorney in his
or her professional capacity and his or her client, whether made
directly or indirectly through an agent
of either;
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(b)
is communicated or given to a
counsel and attorney by, or by a representative of, a client of his
or hers in connection with the giving
by the counsel and attorney
of legal advice to the client;
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(c)
is made or brought into
existence for the purpose of obtaining or giving legal advice or
assistance; and
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(d)
is not made or brought into
existence for the purpose of committing or furthering the
commission of some illegal or wrongful act;
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"regulation" means regulations made under section 13; |
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"request" means an application made pursuant to Article 2 for assistance; |
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"resident" has the meaning assigned to it by Article 1; |
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"tax" has the meaning assigned by Article 1; |
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"the United States" has the meaning assigned by Article 1; |
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"the U.S. Government" means the Government of the United States. |
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(2)
In this Act, a reference to
the Minister, in relation to any function to be performed by the
Minister under this Act, includes a reference
to the Financial
Secretary as the duly designated Competent Authority under the
Agreement.
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(3)
A reference in this Act to the
performance of a function includes reference to the performance of
a duty or the exercise of a power
or right.
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3.(1)
This Act has effect for the
purpose of enforcing the giving of assistance by persons in The
Bahamas in connection with the performance
of the obligations
assumed by The Bahamas under the Agreement and shall remain in
force only for the duration of the Agreement.
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Legal effect of this Act. |
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(2)
Subject to subsections (3) and
(4), the Minister in performing his functions under this Act, is
not restricted by any law or any rule
of law relating to
confidentiality except as expressly provided in the
Agreement.
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(3)
For the avoidance of doubt it
is hereby expressly declared that nothing in this Act shall be
construed as imposing any obligation
on the Government of The
Bahamas to supply information that constitutes or would reveal a
privileged communication.
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(4)
Nothing in this Act shall be
construed as imposing on the Government of The Bahamas any
obligation to -
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a) carry out administrative measures at variance with the laws and administrative practices of The Bahamas; |
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b) supply particular items of information which are not obtainable under the laws or in the normal course of the administration of The Bahamas; |
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c) supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process; |
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d) supply information the disclosure of which would, in the judgement of the Government of The Bahamas, be contrary to national security or public policy in The Bahamas; or |
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e) supply information that relates to a matter under United States federal tax law that is barred by the applicable statute of limitations. |
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4.(1)
A request must be in
writing.
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Procedure in respect of a request. |
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(2)
A request must be signed by a
senior official designated by the U. S. Government.
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(3)
A request shall include the
following particulars -
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a) that by the request, the U.S. Government seeks the information identified in the request; |
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b) that the information requested relates to the carrying out of the laws of the United States following the procedure as prescribed in Article 2; |
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c) the identity of the taxpayer in respect of whom the information is sought; |
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d) whether or not the taxpayer is a resident of the United States; |
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e) a description of the requested information including the type and form of information being sought; |
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f) the period of time with respect to which the information is requested; |
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g) that the information relates to an examination of the taxpayer identified in the request for a pending matter relating to a taxable period of the taxpayer, being the period so specified in the request; |
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h) where the request also seeks information relating to a time frame outside the taxable period specified in the request, the request must clearly establish the connection between that taxable period and the time frame for the information; |
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i) that the period in respect of which the information is sought is not barred by the applicable statute of limitation of the United States; |
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j) that the information sought is in The Bahamas, its likely location and that a person in The Bahamas that is specified in the request has or may have the information in his possession, custody, or control; |
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k) whether the information is required for a civil matter or for a criminal matter; |
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l) where the request is in respect of a civil matter the law imposing the tax must be specified; |
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m) where the request involves a criminal matter the law contravened or believed to have been contravened must be specified; |
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n) a declaration that the information being sought is foreseeably relevant or material to United States federal tax administration and enforcement with respect to the person identified in paragraph (c) above; |
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o) the reasons for believing that the information requested is foreseeably relevant or material to tax administration and enforcement with respect to the person identified in paragraph (c) of this subsection. |
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(4)
In addition to the requirement
under subsection (2) of this section, in the case where the
information requested is in respect of
a matter which relates to a
person who is not resident in the United States or does not
constitute a criminal matter, a senior official
designated by the
U.S. Government must certify that the request is foreseeably
relevant or material to the determination of a tax
liability of a
taxpayer of the United States, or to the criminal liability of a
person under the tax laws of the United States, as
the case may
be.
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5.(1)
Subject to this section, where
the Minister has received a request in respect of which the
requirements of section 4 are fulfilled,
he shall by notice in
writing under this section served upon the person referred to in
paragraph (j) of subsection (3) of that section
direct him to
deliver to the Minister the information referred to in that
paragraph.
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Power to require production of information. |
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(2)
For the purposes of
subsections (3) and (4) of this section, a subsection (2) matter is
a matter -
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(a)
with respect to which information
is sought in a request; and
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(b)
which relates to a person who is
not a resident of the United States,
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whether or not the requirements of section 4 are fulfilled in relation to the request. |
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(3)
Where the Minister receives a
request which seeks information with respect to a matter which
either -
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(a)
is a subsection (2) matter;
or
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(b)
does not constitute a criminal
matter,
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he shall not issue a notice under this section to any person unless the Minister receives, in accordance with subsection (4) of section 4 certification from a senior official designated by the Secretary of the Treasury of the United States that the information sought by the request is foreseeably relevant or material to the determination of the federal tax liability of a United States taxpayer, or the criminal tax liability of a person under the federal tax laws of the United States, as the case may be. |
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(4)
Notwithstanding the condition
for certification set out under subsection (3), where the Minister
receives a request which seeks information
with respect to a
subsection (2) matter, he shall not issue a notice under this
section to any person unless the Minister is satisfied
that the
information is foreseeably relevant or material to the
administration and enforcement of the federal tax laws of the
United
States.
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(5)
A notice issued under
subsection (1) of this section must‑
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(a)
contain the relevant details of
the request to which the notice relates; and
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(b)
specify the time within which
information sought by the request is to be delivered to the
Minister, which time shall not be more than
twenty-eight days,
commencing with the day on which the notice was served.
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(6)
The Minister may extend the
time specified in the notice beyond twenty-eight days where he
considers that the circumstances warrant
such an extension.
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(7)
Subject to subsection (8), a
person who is directed by a notice under subsection (1) to deliver
information to the Minister shall
deliver it to the Minister in
accordance with the notice if the information is in The Bahamas and
that person has it in his possession,
custody or control.
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(8)
A person complies with a duty
under this section to deliver information to the Minister if he
makes the information available to him.
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(9)
A direction given in a notice
under this section to a person is an absolute defence to any claim
brought against him in respect of
any act of his that was done, or
any omission of his that was made, in good faith in obedience to
the direction.
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(10)
Where the Minister receives a
request in respect of which the requirements of section 4 are
fulfilled and such information is publicly
available through a
registry within a government department, the Minister may waive the
requirements for notice under this section
.
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6.(1)
The Minister, or an officer
designated by him, may apply to a judge in accordance with the
provisions of this section for a warrant
to enter upon premises for
the purpose of enforcing a notice issued under section 5.
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Power to enter premises to obtain information. |
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(2)
Any officer so designated
under subsection (1) of this section must produce to the judge the
written authority signed by the Minister.
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(3)
If, on information given on
oath by such an officer, a judge is satisfied that there is
reasonable ground for suspecting that an offence
against this Act
has been, or is being, or is about to be, committed on any
premises, being an offence by reason of which the delivery
to the
Minister of information sought by a request is endangered, then the
judge may issue a warrant in writing authorizing an officer
of the
Ministry to enter the premises at any reasonable time, if necessary
by force, within fourteen days commencing on the day of
the issue
of the warrant, and search such premises.
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(4)
In issuing a warrant under
this section, the judge may impose such restrictions upon the
execution of the warrant as he may deem proper
in the
circumstances.
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(5)
An officer entering premises
by virtue of a warrant under this section may be accompanied by a
police officer and such other person
and equipment authorized by
the Minister as he considers necessary to enable him to enforce the
warrant, and on leaving such premises
entered by virtue of a
warrant under this section, shall, if the premises are unoccupied
or the occupier is temporarily absent, leave
them as effectively
secured against trespassers as the officer found them.
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(6)
On entering premises by virtue
of a warrant under this section, the officer may seize and remove
any article or information relevant
to a request under this Act
wheresoever found which he has reasonable cause to believe may
contain information relevant to a request,
and shall immediately
deliver to the Minister such article and information so seized and
removed.
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(7)
Where entry to premises has
been made by virtue of a warrant under this section and the officer
making the entry has seized any article
or information under the
authority of the warrant, the officer shall prepare a list of such
articles or information and, if so requested
by a person showing
himself either -
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(a)
to be the occupier of the
premises; or
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(b)
to have had possession or custody
of those articles or information immediately before the
seizure,
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provide that person with a copy of that list. |
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(8)
Where articles and information
are seized under the authority of a warrant and it is shown that
access to such articles and information
is required for the
continued conduct of the business or affairs of any person, the
Minister shall afford to that person reasonable
access to those
articles commencing on the day on which he obtained the articles or
information.
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7.(1)
Subject to subsection (2),
where the Minister obtains articles by virtue of section 5 or 6, he
shall -
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Provision supplementary to sections 5 and 6. |
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(a)
unless he returns it pursuant to
paragraph (c), not disclose or reveal to any person the contents or
import of the articles or information,
for twenty days commencing
on the day on which he obtained the articles or information;
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(b)
after the expiry of the twenty
days, if the articles or information in his opinion contains
information sought by a request, he may
make copies of such
information as relates to the request for onward transmission to
the Competent Authority of the United States;
and
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(c)
whether or not the articles or
information contains information sought by a request, return the
articles or information as soon as
practicable to the person from
whom he obtained it.
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(2)
The Minister may extend the
time period under paragraph (a) of subsection (1) for the holding
of any article or information without
further disclosure in the
event a taxpayer or interested person has objected to the Minister
providing the assistance requested or
otherwise seeking judicial
review of or other lawful recourse against an act of the Minster
pursuant to section 12.
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8.(1)
A document to be served under
this Act is to be treated as properly served on the person to whom
it is addressed if it is served in
the manner provided under
subsection (2).
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Service of documents. |
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(2)
The document may be served on
or delivered to the person personally or by being sent by
registered post in his name to his last known
business or private
address.
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(3)
The time period specified in
section 7 of the Interpretation and General Clauses Act shall not
apply to this section.
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Ch. 2. |
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9.(1)
A person who -
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Offences. |
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(a)
contravenes subsection (7) of
section 5; or
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(b)
willfully obstructs an officer
executing a warrant under section 6 or a person lawfully
accompanying him pursuant to subsection (5)
of that section,
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commits an offence. |
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(2)
Any person who, in connection
with delivering information pursuant to subsection (5) of section
5, wilfully tampers with or alters
any information or any part of
such information so that the information or any part of such
information is false when received by
the Minister, commits an
offence.
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(3)
Any person who wilfully
alters, destroys, damages or conceals any information requested by
the Minister pursuant to section 5 commits
an offence.
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(4)
Any person who commits an
offence under this section shall be liable on summary conviction to
a fine not exceeding $5,000 or to imprisonment
for a term not
exceeding six months or to both.
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10.(1)
Where a request so stipulates,
the Minister shall obtain the information sought by the request in
the form of -
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Depositions, etc. |
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(a)
depositions of witnesses;
or
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(b)
original documents or copies of
original documents,
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being depositions so made, and documents or copies so certified or authenticated, as the laws and administrative practices of The Bahamas permit. |
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(2)
Regulations shall be made,
conferring such function on such persons as the regulations may
specify, so that full effect can be given
to subsection (1).
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11.(1)
The Minister shall establish
and maintain a committee, to be known as "the Tax Agreement
Advisory Committee" for the purpose of advising
him on matters of
policy in connection with the performance of his functions under
this Act.
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Advisory Committee. |
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(2)
The Tax Agreement Advisory
Committee ("the Committee") shall consist of such persons (not
fewer than five in number), to be appointed
by the Minister, as he
thinks fit, but so that not fewer than three of the Committees'
members shall be persons appearing to him
to be knowledgeable about
the matters dealt with in the Agreement.
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(3)
The Minister shall appoint a
person to be the Committee's Chairman.
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(4)
Subject to Article 3(2)
dealing with confidentiality, the Minister may refer to the
Committee any matter mentioned in subsection (1),
and shall take
into consideration any advice that the Committee may tender on that
matter.
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12.
Nothing in this Act shall
exclude or restrict the right of any person aggrieved by the
performance by the Minister or any other person
with any function
under this Act to challenge the performance of that function, in so
far as it affects such person, either by seeking
review of a
decision by the Supreme Court or by taking any other action which
is lawfully available.
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Judicial review. |
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13.(1)
The Minister may make
regulations -
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Regulations. |
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(a)
prescribing anything that is
required or permitted by this Act to be prescribed by regulations,
or that the Minister thinks is necessary
to be prescribed for
carrying out the provisions of this Act; and
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(b)
creating offences under this Act
and prescribing penalties for such offences not exceeding the
penalties prescribed under section
9.
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(2)
The provisions of section 31
and 32 of the Interpretation and General Clauses Act shall not
apply in relation to any regulations made
by the Minister under
this Act but instead all such regulations shall be subject to
affirmative resolution of the House of Assembly.
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Ch. 2. |
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(3)
In subsection (2), the
expression "subject to affirmative resolution of the House of
Assembly" in relation to regulations means that
any such
regulations are not to come into operation unless and until
approved by a resolution of the House of Assembly.
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14.
This Act binds the
Crown.
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The Crown. |
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SCHEDULE |
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AGREEMENT BETWEEN THE GOVERNMENT OF THE COMMONWEALTH OF THE BAHAMAS AND THE GOVERNMENT OF THE UNITED STATES OF AMERICA FOR THE PROVISION OF INFORMATION WITH RESPECT TO TAXES AND FOR OTHER MATTERS |
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WHEREAS The Bahamas has taken significant steps in the international fight against money laundering and other financial crimes, and the United States recognizes The Bahamas as a cooperating country with respect to all relevant international efforts to counter money laundering activities ; |
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WHEREAS the United States has recognized the efforts on the part of The Bahamas to ensure that the same financial standards apply in The Bahamas as apply in other recognized international financial centers ; |
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WHEREAS, the Government of The Bahamas and the Government of the United States (the "Contracting Parties"), wish to enter into an agreement (the "Agreement") to establish the terms and conditions governing the provision of information by the Government of The Bahamas to the Government of the United States with respect to certain taxes ; and |
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WHEREAS the Contracting Parties wish to enter into a form of agreement that allows United States taxpayers to deduct expenses allocable to a convention, seminar or similar meeting held in The Bahamas in the same manner and to the same degree that such a deduction would be permitted if such meeting were held in the United States, |
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NOW, THEREFORE, the Contracting Parties agree as follows : |
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ARTICLE 1 - DEFINITIONS |
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1.
In this Agreement, unless
otherwise defined:
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a) "civil matter" means an examination, investigation or proceeding relating to United States federal tax administration and enforcement with respect to conduct that does not constitute a criminal tax offense under the laws of the United States; |
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b) "Competent Authority" means: |
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(i)
in the case of the United
States, the Secretary of the Treasury or his delegate; and
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(ii)
in the case of The Bahamas, the
Minister of Finance or his delegate;
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c) "criminal matter" means an examination, investigation or proceeding concerning conduct that constitutes a criminal tax offense under the laws of the United States; |
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d) "information" means any fact or statement, in any form, that is foreseeably relevant or material to United States federal tax administration and enforcement, including, but not limited to, |
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(i)
testimony of an individual,
and
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(ii)
documents or records;
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e) "pending matter" means an examination, investigation or proceeding under the federal tax laws of the United States that is pending at the time the request under Article 2 is made, and |
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(i)
in the case of a criminal
matter, relates to a taxable period commencing on or after January
1, 2004; or
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(ii)
in the case of a civil matter,
relates to a taxable period commencing on or after January 1,
2006;
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f) "person" includes an individual and a partnership, corporation, trust, estate, association or other legal entity; |
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g) "privileged communication" means a communication that |
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(i)
is a confidential communication,
whether oral or written, passing between‑
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(a)
a counsel and attorney in his
or her professional capacity and another counsel and attorney in
such capacity; or
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(b)
a counsel and attorney in his
or her professional capacity and his or her client, whether made
directly or indirectly through an agent
of either;
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(ii)
is communicated or given to a
counsel and attorney by, or by a representative of, a client of his
or hers in connection with the giving
by the counsel and attorney
of legal advice to the client;
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(iii)
is made or brought into
existence for the purpose of obtaining or giving legal advice or
assistance; and
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(iv)
is not made or brought into
existence for the purpose of committing or furthering the
commission of some illegal or wrongful act.
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h) "resident" means: |
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(i)
a citizen of the United States
or any person, other than a company, resident in the United States
for the purpose of United States
tax; but in the case of a
partnership, estate or trust, only to the extent that the income
derived by such partnership, estate or
trust is subject to United
States tax as the income of a resident, either in its hands or in
the hands of its partners or beneficiaries;
and:
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(ii)
a company created under the laws
of the United States, any state or the District of Columbia.
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i) "tax" means all federal taxes in the United States; |
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j) for purposes of determining the geographical area within which jurisdiction to compel production of information may be exercised, |
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(i)
"United States" means the United
States of America, including Puerto Rico, the Virgin Islands, Guam
and any other United States possession
or territory;
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(i)
"The Bahamas" means The
Commonwealth of The Bahamas.
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ARTICLE 2 - PROVISION OF INFORMATION WITH RESPECT TO UNITED STATES TAXES |
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1.
The Competent Authority of the
United States shall only make a request for information pursuant to
this Article when the Competent
Authority of the United States is
unable to obtain the requested information by other means, having
made all reasonable efforts to
do so.
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2.
Upon receipt of a request made
in conformity with the provisions of this Article, the Competent
Authority of The Bahamas shall, subject
to the provisions of
paragraph 7 of this Article, make all reasonable efforts to provide
to the Competent Authority of the United
States information with
respect to United States federal taxes.
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3.
Any request for information
made by the Competent Authority of the United States pursuant to
this Article shall be made in connection
with a pending matter of a
United States taxpayer and shall be framed with the greatest degree
of specificity possible. In all cases,
such request shall specify
in writing the following:
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a) the legal name of the person about whom the request is made; |
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b) the type of information requested; |
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c) the period of time with respect to which the information is requested; |
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d) the likely location of the information; |
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e) the matter under United States federal tax law with respect to which the information is sought and whether that matter is criminal or civil in nature; and |
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f) the reasons for believing that the information requested is foreseeably relevant or material to United States federal tax administration and enforcement with respect to the person identified in subparagraph a) of this paragraph. |
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4.
This Article shall not apply
to the extent that the requested information:
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a) relates to a matter under United States federal tax law that is barred by the applicable statute of limitations; or |
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b) constitutes or would reveal a privileged communication. |
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5.
Where the Competent Authority
of the United States requests information with respect to a matter
which (i) relates to a person not
resident in the United States or
(ii) does not constitute a criminal matter, a senior official
designated by the Secretary of the
Treasury of the United States
shall certify that such request is foreseeably relevant or material
to the determination of the federal
tax liability of a taxpayer of
the United States or the criminal liability of a person under the
federal tax laws of the United States.
If information is requested
relating to persons not resident in the United States, it shall
also be established to the satisfaction
of the Competent Authority
of The Bahamas that such information is foreseeably relevant or
material to the administration and enforcement
of the federal tax
laws of the United States.
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6.
If specifically requested by
the Competent Authority of the United States, the Competent
Authority of The Bahamas shall provide information
pursuant to this
Article in specified forms to be admissible in judicial or
administrative proceedings in the United States to the
same extent
that such specified forms can be obtained under the laws and
administrative practices of The Bahamas. The specified forms
shall
include depositions of witnesses and authenticated copies of
original documents, including books, papers, statements, records,
accounts, and writings.
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7.
Nothing in this Agreement
shall be construed so as to impose on the Government of The Bahamas
the obligation to:
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a) carry out administrative measures at variance with the laws and administrative practices of The Bahamas; |
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b) supply particular items of information which are not obtainable under the laws or in the normal course of the administration of The Bahamas; |
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c) supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process; or |
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d) supply information the disclosure of which would, in the judgment of the Government of The Bahamas, be contrary to national security or public policy in The Bahamas. |
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8.
Notwithstanding paragraph 7,
the Competent Authority of The Bahamas shall have the authority to
obtain and provide information held
by financial institutions,
nominees or persons acting in an agency or a fiduciary capacity or
information respecting ownership interests
in a person.
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9.
In connection with a request
for information under this Article:
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a) a claim of privilege under the laws of the United States shall be determined exclusively by the courts of the United States; and |
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b) a claim of privilege under the laws of The Bahamas shall be determined exclusively by the courts of The Bahamas. |
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ARTICLE 3 - PROTECTION OF INFORMATION |
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WITH RESPECT TO UNITED STATES FEDERAL TAXES |
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1.
Information provided to the
Competent Authority of the United States pursuant to this Agreement
shall be disclosed only to departments,
agencies and judicial and
administrative bodies of the Government of the United States, and
to employees and agents thereof, involved
in the -
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a) determination, assessment, and collection of; and |
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b) administration of, the recovery and collection of claims derived from, the enforcement or prosecution in respect of, or the determination of appeals in respect of; |
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those United States federal taxes with respect to which the relevant request was made pursuant to this Agreement, or the oversight of the above. Such departments, agencies and judicial and administrative bodies, and the employees and agents thereof, shall use such information only for the purposes listed in this paragraph. Such departments, agencies and judicial and administrative bodies, and the employees and agents thereof, may disclose such information in connection with court proceedings related to those federal taxes with respect to which the relevant request was made pursuant to this Agreement. |
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2.
The Competent Authority of The
Bahamas shall treat any request for information received from the
United States pursuant to this Agreement
as confidential and shall
only disclose such information as necessary to carry out its
obligations under this Agreement. Such requests
may be disclosed in
connection with court proceedings related to the performance of the
obligations of The Bahamas under this Agreement.
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3.
Nothing in this Agreement
shall be construed to permit the Government of the United States to
share information received pursuant
to this Agreement with an
agency or employee of any other government.
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4.
Information that is provided
to the Government of the United States pursuant to this Agreement
before January 1, 2006 concerning a
criminal matter shall not be
used in connection with any other matter without prior written
consent of the Competent Authority of
The Bahamas. With respect to
information that is provided to the Government of the United States
pursuant to this Agreement on or
after January 1, 2006, the
Competent Authority of the United States shall provide prior
written notice to the Competent Authority
of The Bahamas before
using such information for a type of United States federal tax
matter other than the one for which it was requested.
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ARTICLE 4 - QUALIFIED INTERMEDIARIES |
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For the purposes of considering an application by a person in The Bahamas to enter into a Qualified Intermediary Withholding Agreement (within the meaning of Revenue Procedure 2000-12) with the Internal Revenue Service of the United States, The Government of the United States shall certify that The Commonwealth of The Bahamas has taken significant steps towards achieving effective rules and/or procedures for providing tax information to the United States of America for both civil tax administration and criminal tax enforcement purposes, and the Internal Revenue Service of the United States of America has determined The Bahamas' "know your customer" rules to be acceptable within the meaning of Section 3 of Revenue Procedure 2000-12. |
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ARTICLE 5 - CONVENTION TAX TREATMENT |
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A United States taxpayer may deduct from income costs incurred with respect to attendance at a conference or convention held in The Bahamas in the same manner and to the same extent that such taxpayer is permitted to deduct such costs with respect to attendance at a conference or convention held in the United States. |
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ARTICLE 6 - ADMINISTRATIVE PROVISIONS |
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1.
The Competent Authorities of
the Contracting Parties shall enter into an agreement (the
"Competent Authority Agreement") regarding
implementation of this
Agreement.
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2.
The Competent Authorities of
the Contracting Parties shall endeavor to resolve by mutual
agreement any disputes arising as to the
interpretation or
application of this Agreement.
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3.
The Competent Authorities of
the Contracting Parties may communicate directly for the purposes
of reaching an agreement under this
Article.
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4.
The Government of the United
States shall reimburse the Government of The Bahamas for all direct
costs incurred in providing information
pursuant to this Agreement
as provided in the Competent Authority Agreement. The Competent
Authorities of the Contracting Parties
shall consult from time to
time with a view to minimizing such costs.
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ARTICLE 7 - ENTRY INTO FORCE ; |
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EFFECTIVE DATE, MODIFICATION AND TERMINATION |
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1.
This Agreement shall enter
into force upon an exchange of notes by the duly authorized
representatives of the Contracting Parties,
confirming their
agreement that both sides have met the constitutional and statutory
requirements necessary to effectuate this Agreement.
|
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2.
The provisions of Articles 2
and 3 shall take effect -
|
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a) on January 1, 2004 with respect to requests for information made in connection with a criminal matter; and |
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b) on January 1, 2006 with respect to requests for information made in connection with a civil matter. |
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3.
The provisions of Article 5
shall take effect on January 1, 2006.
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4.
The provisions of this
Agreement, with the exception of those identified in paragraphs 2
and 3 of this Article, shall take effect
upon the entry into force
of this Agreement.
|
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5.
The effective date provisions
set forth in paragraph 2 of this Article are established in the
expectation that the United States will
enter into arrangements
with certain other off-shore financial centers for the provision of
information with respect to taxes. If
the United States has not
entered into such arrangements by January 1, 2004, or if the United
States, at any time, enters into such
arrangements that differ in
material respect from the provisions of this Agreement, the
Government of The Bahamas and the Government
of the United States
shall hold consultations concerning appropriate modifications to
this Agreement.
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6.
If, at any time after the
entry into force of this Agreement, the Organization for Economic
Cooperation and Development or other international
organization
develops a model agreement on tax information exchange, a
Contracting Party may propose modifications to this Agreement
for
the purpose of bringing this Agreement into conformity with the
model agreement. Upon receipt of such a proposal, the other
Contracting
Party shall enter into good faith negotiations
concerning the proposal.
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7.
This Agreement shall remain in
force until terminated by one of the Contracting Parties. Either
Contracting Party may terminate this
Agreement at any time upon
three months prior written notice transmitted through diplomatic
channels.
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IN WITNESS WHEREOF, the undersigned, being duly authorized by their respective governments, have signed this Agreement. |
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DONE at Washington, in duplicate, this twenty-fifth day of January, 2002. |
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URL: http://www.commonlii.org/bs/legis/num_act/batusoatieaa2003615