On 19 February 2018, the OECD published a consultation document relating to the misuse of residence and citizenship by investment schemes to circumvent the CRS.

Residence and citizenship by investment schemes allow foreign individuals to obtain citizenship or temporary or permanent residence rights in exchange for local investments or against a flat fee. Although such arrangements can be used for a number of legitimate reasons, in the view of the OECD they can also be manipulated to circumvent reporting under the CRS.

The consultation:

• assesses how the schemes are used to circumvent the CRS and identifies the types of scheme that present a high risk of abuse

• sets out the importance of applying CRS due diligence procedures correctly to prevent such abuse, and

• explains the OECD’s next steps.

The OECD is seeking evidence on the misuse of such arrangements and methods of preventing abuse.

A copy of the consultation document can be viewed here