Mainland and Hong Kong Automatic Exchange of Financial Account Information Arrangement Has Taken Effect

The Financial Services and the Treasury Bureau announced that the arrangements for the automatic exchange of financial account information between the Mainland and Hong Kong on the implementation of tax matters have come into effect on September 6. The government stated that Hong Kong and the Mainland would conduct the first automatic exchange of information later this month after the signing of the arrangement. Earlier, Hong Kong has started an automatic data exchange relationship with other 49 tax jurisdictions in accordance with similar bilateral competent authority agreements or multilateral competent authority agreements under the Convention on Tax Collection and Mutual Assistance. The first exchange will also take place in the same period. Automatic exchange of information is a global tax cooperation measure, requiring financial institutions to identify financial accounts held by tax residents reporting tax jurisdictions and collect relevant information to report to tax authorities. As of the end of August this year, a total of 149 tax jurisdictions around the world have promised to implement automatic data exchange.