FATCA: what are the implications for European hedge funds?
Thu Sep 22, 2011
The US Foreign Account Tax Compliance Act (FATCA) is just one of a myriad of new and potentially burdensome regulations heading the way of European hedge funds from both sides of the Atlantic. Richard Hinton of KPMG explains what it involves – and what hedge fund managers and their fund service providers need to do in order to be ready for its arrival in 2013
management industry faces an uphill struggle to be ready for
commencement of the US Foreign Account Tax Compliance Act
(FATCA) on 1 January 2013 - as a recent KPMG report recently
The report's findings reveal that just 32% of the fund
managers surveyed expect to be ready for the January 2013 live
date, and 42% have not yet even assessed the time needed to
Fortunately for hedge funds, FATCA is unlikely to
fundamentally challenge firms' business models in the same way
that it will other sectors of the investment management
industry. Nevertheless, compliance will be necessary and it
will require a significant amount of work.
What is FATCA?
The FATCA legislation was signed into law in early
2010 in a bid to prevent US investors from using offshore
entities to disguise their identity and thus avoid paying US
The FATCA rules are designed to compel...
ISSN: 2151-1845 / CDC10004H
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