The governments of the US and Republic of Costa Rica have signed an agreement to improve international tax compliance and to implement the Foreign Account Tax Compliance Act (FATCA).

As per the agreement, both the parties will mutually assist in tax matters based on an effective infrastructure for the automatic exchange of information.

In addition, they will collectively work towards achieving common reporting and due diligence standards for financial institutions in long term.

Under the agreement, the parties should improve international tax compliance and provide for the implementation of FATCA based on domestic reporting and reciprocal automatic exchange pursuant to the agreement signed on 15 March 1989 (TIEA) and subject to the confidentiality and other protections provided for therein.