On March 18, 2010 President Obama signed into law job creation legislation which included the US tax reform provisions known as "FATCA."  The FATCA provisions will take effect from January 1, 2013 however the full impact of the compliance burden of this leg-islation will not be clear until regulatory guidance is issued by the US tax authorities.

The main provision of FATCA is a new US withholding tax regime that requires non-US financial intermediaries to disclose financial information to the US tax authorities about their US clients or face a 30% withholding tax on the receipt of nearly all US source investment income and gross broker proceeds. These provisions will directly impact non-US banks and investment management firms, including QIs and non-QIs, as well as hedge funds and private equity funds.

QIs would be well advised to begin a FATCA implementa-tion plan immediately, even if the new rules will not take effect until 2013.