Kidding aside, FATCA means Foreign Account Tax Compliance Act. It’s a law that targets tax non-compliance by U.S. taxpayers with foreign accounts. And all they (US citizens and residents) have to do is abide by this law and report their foreign financial accounts and offshore assets through Form 8938.
This Act became law in 2010 and financial institutions here in the Philippines have already mandated compliance with this by requiring US investors to fill out and submit said form. I remember that this has been passed as a joke in our Sunlife of Canada unit when everyone was teasing each other ‘fat ka!, diet ka na!’ 🙂
So, yes, it is still true that ANYONE, including US investors, can invest in the Philippine Stock Market. They just have to report this to IRS.
However, for COL Financial Group, they are momentarily denying applications of US investors until they have fully reviewed the process on this regulatory requirement. This is COL’s standard reply to US applicants:
“We regret that we are presently unable to process your account opening in view of the requirements of the Foreign Account Tax Compliance Act (FATCA). Briefly, FATCA was enacted by the US Congress to prevent offshore tax abuses by US Taxpayers. It requires, among others, the online registration of foreign financial institutions with the US IRS and the submission of reports or information to the IRS. Non-compliance could result in the imposition of penalties. Following hereunder is a list of individuals covered by FATCA:
6. A power of attorney or signatory granted to a person with a US address.
In view of this directive, COL Financial needs to evaluate the provisions of FATCA and the available guidelines issued by our government regulators and assess the implications thereof affecting our customers and COL Financial business policies.”
So, what is your alternative to invest in the stock market?
Well, you can go through Fund Managers (Mutual Fund or Insurance companies) which offer Equity Funds. Or you may try other direct Stock Brokers which allow US investors to open stock accounts. COL Financial Group is just 1 of the many stock brokers in the country accredited by Philippine Stock Exchange (PSE).
But for Pinoys with dual citizenship who really want to open a COL stock account, just write your Philippine address in the application form and submit a Phil. government ID and a Phil. bill statement. COL doesn’t have to know you’re in the US. However, it is your own responsibility to declare this offshore account to the US government once you file your tax forms.
P.S. 1. COL Financial, Inc. is the recommended Stock Broker of Bro. Bo Sanchez to all his Truly Rich Club members. The TrulyRichClub is a membership Club that he had created to help people achieve Financial Wealth and Spiritual Abundance. It is a private group of individuals who have decided to do something about changing their beliefs and thinking—to gain the abundance mentality they need to change their lives forever. Bro. Bo provides them with the right tools, principles, and strategies to grow in their financial and spiritual life.
P.S. 2. Wanna join us at the ‘Happiest Place on Earth‘? Listen to Bro. Bo preach every Sunday at the Feast PICC. For Feast schedules in PICC and other areas around the metro, pls refer to the right side of Kerygma Family homepage.