OECD – Consultation document – PREVENTING ABUSE OF RESIDENCE BY INVESTMENT SCHEMES TO CIRCUMVENT THE CRS (19 February 2018 – 19 March 2018). 1. More and more jurisdictions are offering “residence by investment” (RBI) or “citizenship by investment” (CBI) schemes. These are schemes that allow foreign individuals to obtain citizenship or temporary or permanent residence rights in exchange for local investments or against a flat fee. 2. Individuals may be interested in these schemes for a number of legitimate reasons, including greater mobility thanks to visa-free travel, better education and job opportunities for children, or the right to live in a country with political stability. 3. At the same time, they can also offer a backdoor to money-launderers and taxevaders. In this regard, information released in the market place and obtained through the OECD’s CRS public disclosure facility, highlights the abuse of RBI and CBI schemes to circumvent reporting under the Common Reporting Standard (CRS). 4. The OECD is looking into this matter as part of its CRS loophole strategy. This document (1) assesses how these schemes can be exploited in an attempt to circumvent the CRS; (2) identifies the types of schemes that present a high risk of abuse; (3) reminds stakeholders of the importance of correctly applying relevant CRS due diligence procedures in order to help prevent such abuse; and (4) explains next steps the OECD will undertake to further address the issue, assisted by public input. 5. Public input is sought both to obtain further evidence on the misuse of CBI/RBI schemes and on effective ways for preventing such abuse. Such input will be taken into account in determining the next steps that will be taken. Interested parties are invited to send their comments on this consultation draft by 19 March 2018 at the latest by email to CRS.Consultation@oecd.org in Word format (in order to facilitate their distribution to government officials). They should be addressed to the International Co-operation and Tax Administration Division, OECD/CTPA. Comments in excess of ten pages should attach an executive summary limited to two pages.
