OECD is an organization that promotes policies that improve the economic and social well-being of people around the world. It functions through its bodies: 1. Secretariat that gathers information and analyses data; 2. Committees that discuss the policies based on the gathered information; and 3. Council that makes decisions. The Committees, in order to discuss specific policy areas and finding global solutions organize Global Forums. For the same purpose, the Global Forum on Transparency and Exchange of Information for Tax Purposes was established.

The Global Forum is a group of over 160 jurisdictions, including North Macedonia that includes all G20 countries, financial centres, and the majority of its members are developing countries. Together they work on an equal footing to put an end to offshore tax evasion.

The Global Forum delivers:

• promoting international standards: The Global Forum has become the leading international body working to secure the effective implementation of transparency and exchange of information standards worldwide and more specifically, the exchange of information on request (EOIR) and automatic exchange of information (AEOI). The Global Forum supports its members in tackling offshore tax evasion by monitoring, reviewing and assisting jurisdictions to implement the international standards on transparency and exchange of information for tax purposes;
• monitoring the implementation of the agreed international standards on transparency and exchange of information for tax purposes that the jurisdiction obliged to implement;
• conducting peer reviews to assess the effectiveness of the implementation of the standards; and
• providing technical assistance to support its members which includes Capacity building and technical assistance programme.

Capacity building is one of the core duties of the Global Forum. It aims at supporting and enabling a rapid and effective implementation of the transparency and exchange of information standards by all members, in particular the developing ones. Beyond implementation, the objective is to ensure that developing members effectively benefit from the standards by fighting more efficiently tax evasion and other illicit financial flows and ultimately by mobilising more domestic resources to finance their development. Building capacities and a culture of exchange of information is critical to meet this goal. Launched in 2011, the capacity-building programme has expanded over the years to cover new areas.

The capacity-building and technical assistance programme covers a range of activities that include:

• a comprehensive assistance programme for new member countries, which includes intensive medium-term mentoring and capacity building;
• technical assistance tailored to the needs of the country and mainly focused on advanced transparency requirements such as beneficial ownership and automatic exchange of information;
• trainings and the development and provision of tools, such as e-learning courses and toolkits, to assist in the implementation of the standards;
• regional initiatives to promote transparency and the exchange of information for tax purposes in particular regions, working closely with relevant regional bodies.

The Global Forum also organises meetings of the Competent Authorities for exchange of information in tax matters. These meetings facilitate practical co-operation amongst all member countries with the sharing of best practices operationally and the strengthening of relationships amongst the individuals directly involved in operationalising the international standards.

Exchange of information on request (EOIR)

Exchange of information on request (EOIR) is an essential tool for tax authorities worldwide to ensure that all taxpayers pay the correct amount of tax. Under the EOIR Standard, tax authorities can make specific requests to other tax authorities for information that will allow them to progress their tax investigations. The information that could be requested includes accounting records, bank statements and information on the ownership of assets.

Implementing the EOIR Standard requires each jurisdiction to respond effectively to requests they receive from their exchange partners. The EOIR Standard is therefore built around three key requirements:

1. ensuring the availability of ownership, accounting and banking information;
2. providing access to this information by the tax authorities; and
3. exchanging this information in a timely manner with other interested jurisdictions with which an agreement is in place.

Once in place and operating effectively in practice, the EOIR Standard provides the foundation for effective international co-operation to tackle offshore tax evasion.

The first round of reviews was conducted in the period from 2010 to 2016, while the second phase is ongoing, with the main goal of continuous compliance when implementing of the standards for international exchange of information on request.

Peer review of Republic of North Macedonia by the Global Forum was performed in:

• 2014 - 1st phase of peer review (assessed as Largely Compliant)
• 2018 - 2nd phase of peer review (assessed as Largely Compliant)

***The scores are in range: 1. Compliant; 2. Largely Compliant; 3. Partially Compliant; and 4. Non-Compliant with the internationally agreed standards for international exchange of information.

Automatic exchange of information (AEOI)

Automatic exchange of information (AEOI) provides for the automatic exchange of a predefined set of information between tax authorities. The AEOI Standard requires the annual exchange of information on financial accounts held by non-resident individuals and entities in a pre-defined format. The information exchanged includes details about the financial account (e.g. the financial institution maintaining it, the account number and the account balance) and details about the account holder (e.g. their name, address, date of birth and taxpayer identification number).

Implementing the AEOI Standard requires jurisdictions to collect the information each year from their financial institutions (which include banks, hedge funds and investment trusts) and to automatically exchange it with the jurisdictions where the account holder is tax resident (provided the jurisdiction has in place the necessary framework to keep the information confidential and properly safeguarded). The AEOI Standard is therefore built on three key components:

• A domestic legal framework that requires financial institutions to collect and report the information;
• Exchange agreements between all Interested Appropriate Partners (those interested in receiving information and that meet the required standards in relation to confidentiality and data safeguards); and
• The systems and processes for the information to be reported and exchanged effectively in practice, including to ensure compliance by Financial Institutions.

Through these three components the AEOI Standard provides for a powerful tool to help deter and identify offshore tax evasion through holding financial assets abroad.

AEOI requires jurisdictions to have in place the required standards in relation to confidentiality and data safeguards, particularly in relation to the policies and systems, to ensure the information they receive is kept safe. This requires the following components:

• A domestic and international legal framework that keeps the use of the information restricted to the purposes under which the information is exchanged and which forbids its unauthorised disclosure; and
• Policies and systems that ensure that in practice the information is kept confidential and properly safeguarded.

With respect to the newer AEOI Standard, the Global Forum has already reviewed the domestic and international legal frameworks in place and initiated the review of the effectiveness of its implementation in practice.

North Macedonia is in the process of implementation of the standard for automatic exchange of information.