Cayman's unilateral mechanism

We have been aware for some time that Cayman has a "unilateral mechanism" for information exchange, that is neither "on-request", "automatic", or "spontaneous" (see our draft briefing paper for more details, which we'll be updating before too long.) We haven't yet described unilateral exchange in detail yet. One summary puts it like this:

"The unilateral mechanism is part of Cayman’s 2008 Tax Information Authority Law, by which local authorities gain assent of nominated countries to exchange tax information without requiring formal government negotiations."

Following our two blogs yesterday on the OECD and on Cayman's internal letter, the following has just been sent to us by a contact in the Cayman Islands. It is a news release issued by the Portfolio of Finance and Economics (we can't find a link for it, unfortunately).

"The Cayman Islands announced progress this week in both areas of its implementation of international standards in tax information exchange. The Cayman Islands unilateral mechanism1 was cleared to go forward by the Harmful Tax Practices Sub-committee for review by the Committee on Fiscal Affairs2 of the Organisation for Economic Cooperation and Development (OECD). The Committee on Fiscal Affairs will review the unilateral mechanism next month."

The unilateral mechanism is interesting. We hope to be discussing it with Cayman officials soon, to understand it better. We aren't passing judgement at this stage, until we know more, though there is no doubt that multilateral, automatic and comprehensive exchange of information is the way to go. But it's worth keeping an eye out for this unilateral mechanism; we'll return to this.