CCB Cross-Border Compliance Issues 3

Question 1

Under the Foreign Account Tax Compliance Act (FATCA), what obligation does a foreign financial institution (FFI) have regarding US account holders?

Accepted Answer

FFIs must report US account holder information to the IRS or withhold 30% on certain US-source payments

Answer

FATCA requires FFIs to identify and report US account holders' financial information to the IRS or face a 30% withholding tax on certain US-source income.

Question 2

A company operating in a country with strict data localization laws (e.g., Russia's Federal Law 242-FZ) must ensure that:

Accepted Answer

Personal data of Russian citizens is stored on servers physically located in Russia

Answer

Russia's Federal Law 242-FZ requires that personal data of Russian citizens be stored and initially processed on databases located within Russian territory.

Question 3

Which international standard provides a framework for anti-bribery management systems that organizations can implement to demonstrate cross-border compliance efforts?

Accepted Answer

ISO 37001 (Anti-Bribery Management Systems)

Answer

ISO 37001 is the international standard specifically designed for anti-bribery management systems and is recognized by enforcement authorities worldwide.

Question 4

A US company's foreign subsidiary in Country Y is subject to a local law that requires paying a 'facilitation fee' to customs officials to release goods. Under the FCPA, this payment:

Accepted Answer

May qualify for the narrow FCPA facilitating payments exception only if it expedites a routine governmental action

Answer

The FCPA provides a narrow exception for facilitating payments made to expedite routine, non-discretionary governmental actions, though this exception has been narrowly interpreted.

Question 5

The Common Reporting Standard (CRS) developed by the OECD requires participating jurisdictions to:

Accepted Answer

Automatically exchange financial account information between tax authorities of member countries

Answer

CRS is an OECD framework under which participating countries automatically exchange financial account information to combat global tax evasion.

(CCB) Certified Compliance and Business Specialist Practice Test

(CCB) Certified Compliance and Business Specialist Practice Test

CCB Cross-Border Compliance Issues 3