1. Michael H. Plowgian August 9, 2014 FATCA, Extraterritoriality, and the Path to the OECD- Standard on Automatic Exchange of Information (“AEOI”)

2. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 1  ANY TAX ADVICE IN THIS COMMUNICATION IS NOT INTENDED OR WRITTEN BY KPMG TO BE USED, AND CANNOT BE USED, BY A CLIENT OR ANY OTHER PERSON OR ENTITY FOR THE PURPOSE OF (i) AVOIDING PENALTIES THAT MAY BE IMPOSED ON ANY TAXPAYER OR (ii) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.  You (and your employees, representatives, or agents) may disclose to any and all persons, without limitation, the tax treatment or tax structure, or both, of any transaction described in the associated materials we provide to you, including, but not limited to, any tax opinions, memoranda, or other tax analyses contained in those materials.  The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

3. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 2 Foreign Account Tax Compliance Act (FATCA) New U.S. reporting and withholding tax regime Effective Date: 1 July 2014 Goal: reduce tax evasion by U.S. individuals investing in non-U.S. accounts and offshore financial vehicles Reporting: – foreign (non-U.S.) financial institutions (banks, custodians, investment funds, administrators, investment managers, etc.) – must identify and report to the IRS – certain information about their U.S. account holders Withholding: Foreign financial institutions that do not comply are subject to a new 30% withholding tax on certain payments received from U.S. payors

4. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 3 How FATCA Operates Payments subject to FATCA Withholding  U.S. source investment income (“FDAP – interest, dividends, royalties, rents, etc.)  Gross proceeds from the sale or exchange of U.S. assets that produce U.S. interest and dividends  Banks / credit unions / other depository institutions  Custodians / entities that hold other people’s money  Entities that invest other people’s money (collective investment vehicles, certain asset managers)  Certain insurance companies (mainly life)  Certain treasury and holding companies Foreign Financial Institutions (“FFIs”)

5. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 4 Need for Different Approach In many jurisdictions, complying with the FATCA regulations is not possible for financial institutions: – Identifying and reporting account holders to the IRS without the account holder’s consent would violate applicable privacy or data protection laws – Withholding on payments to uncooperative account holders and nonparticipating financial institutions also conflicts with laws in many jurisdictions

6. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 5 Intergovernmental Agreements (IGA) Address Extraterritoriality Concerns Intergovernmental agreements provide an alternative and less burdensome means for financial institutions to comply with FATCA Provides means of resolving legal impediments to reporting by financial institutions (e.g., privacy laws) Under an IGA, partner government agrees to create rules that will allow its financial institutions either to: –Report to their home government, which will exchange the information with the IRS, potentially on a reciprocal basis, or –Report directly to the IRS IGAs require the same information to be reported by financial institutions, but provide greater flexibility for governments to implement in their own jurisdictions 39 signed IGAs; additional 62 agreed in substance

7. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 6 FFI National Government Reciprocal Agreement Non-Reciprocal Agreement Comparison of FATCA Model 1 and Model 2 IGA (Flow of information) Reporting on U.S. Account holders on individual basis and recalcitrant account holders on an aggregated basis Request for information Request information Info No Intergovernmental Agreement Intergovernmental Agreement Model 1 Intergovernmental Agreement Model 2

8. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 7 13 February: OECD publishes new global standard for automatic exchange of information (“Common Reporting Standard”) 22-23 February : G20 endorsement “We endorse the Common Reporting Standard for automatic exchange of tax information on a reciprocal basis and will work with all relevant parties, including our financial institutions, to detail our implementation plan at our September meeting. In parallel, we expect to begin to exchange information automatically on tax matters among G20 members by the end of 2015. We call for the early adoption of the standard by those jurisdictions that are able to do so. We call on all financial centres to match our commitments.” IGAs Lead to OECD/G20 Standard

9. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 8 Bank Country A US Account Holder Bank Account Holder Country B      1.Model 1 IGA reporting 2.Model 1 IGA exchanges 3.Leveraging on Model 1 IGA implementation to develop standardised automatic exchange in a multilateral context Account Holder Bank    Automatic exchange standard Basic approach 8

10. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 9 Bank Country A Account Holder Bank Account Holder Country B Reporting of information based on Common Reporting and Due Diligence Standard (CRS) implemented via domestic law Automatic exchange standard Basic approach - CRS + CAA = exchange standard 9 Automatic exchange of information based on MTC Article 26 or MAC, & Model CAA Reporting of information based on Common Reporting and Due Diligence Standard (CRS) implemented via domestic law

11. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 10 Automatic exchange standard Main differences from FATCA 10 Individuals Residence (not including citizenship) No thresholds Residence address test for pre-existing accounts building on EU Savings Directive Simplified indicia search Entities Look-through for Reportable Entities that are Passive NFEs Look-through for professionally managed investment entities in non-participating jurisdictions Low risk FIs and products General exclusion for country specific low-risk reporting financial institutions and accounts No Withholding

12. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 11 Automatic exchange standard Next steps 11 Establish mechanisms to monitor and review implementation of standard Work on developing country issues and assist them in meeting the standard Global Forum Adopt CRS in domestic law Conclude CAA Consult and work with financial institutions on implementation Put in place IT and administrative process Ensure confidentiality of information Participating countries

13. © 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 12 U.S. Adoption of CRS? Impact of CRS on FATCA Ability to enter into IGAs Will CRS satisfy FFIs’ obligations under FATCA? Impact on USFIs Will U.S. adopt CRS for reporting by USFIs? What is response from G-20, other countries?

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