When you open a bank account, you usually fill in a form about your tax residence and any connection with the United States. Part of the reason for that form is a US law called FATCA. This article explains what FATCA is, where Dominica, Vanuatu and the UAE stand in its official table, and what this means for someone who obtains a second passport. The information comes from the websites of the US Department of the Treasury and the US Internal Revenue Service (IRS), checked on 24 October 2026.
What is FATCA?
According to the US Treasury, the Foreign Account Tax Compliance Act was enacted in 2010 to target non-compliance by US taxpayers using foreign accounts. It requires foreign financial institutions to report to the IRS information about the financial accounts of two groups:
- US taxpayers;
- foreign entities in which US taxpayers hold a substantial ownership interest.
Foreign financial institutions are encouraged to register directly with the IRS or to comply with the intergovernmental agreement (IGA) treated as in effect in their jurisdiction.
Two agreement models
| Topic | Model 1 | Model 2 |
|---|---|---|
| Whom the institution reports to | its own government | directly to the IRS |
| Transfer to the IRS | the government sends it to the IRS automatically | the institution reports on Form 8966 |
| Institution's registration with the IRS | through the country's arrangements | required, with an agreement as a foreign financial institution |
| Accounts whose holders did not consent | — | the IRS may send a "group request" to the partner government |
| Exchange | reciprocal or non-reciprocal | — |
The IRS says both models can be implemented without a double tax treaty or a tax information exchange agreement with the United States.
Dominica, Vanuatu and the UAE in the official table
The US Treasury publishes a table of jurisdictions with FATCA agreements. On the day we checked, the rows for these three countries read:
| Country | Model | Status | In force | Treated as having an IGA in effect from |
|---|---|---|---|---|
| Dominica | Model 1 | In force | 12 August 2019 | 30 June 2014 |
| United Arab Emirates | Model 1 | In force | 19 February 2016 | 30 June 2014 |
| Vanuatu | not in the table | — | — | — |
The table writes dates in the US style (month-day-year); above they are written as day and month. The UAE row also lists an "Understanding" document.
Vanuatu's absence from the table does not mean Vanuatu banks never report. According to the Treasury page, foreign financial institutions can register directly with the IRS. What each bank does is that bank's policy.
Timeline
| Date | Event |
|---|---|
| 2010 | FATCA enacted in the United States |
| 30 June 2014 | the date from which Dominica and the UAE are treated as having an agreement in effect |
| 19 February 2016 | the UAE agreement enters into force |
| 12 August 2019 | the Dominica agreement enters into force |
The "treated as having an IGA in effect" column in the Treasury table shows from when a country is treated in practice as having an agreement, even before the agreement formally enters into force. For Dominica this gap is about five years, from 2014 to 2019. In other words, banks in Dominica were within the FATCA framework years before the agreement formally took effect.
How do FATCA and the CRS differ?
| Topic | FATCA | CRS |
|---|---|---|
| Origin | US law, 2010 | OECD standard, 2014 |
| Whom it follows | US taxpayers | people who are tax resident in another country |
| Who receives the information | the US IRS | the account holder's country of tax residence |
| Basis | US tax status, which includes US citizenship | tax residence |
The article "Banks, the CRS and a second passport" explains the CRS separately.
Examples
| Person | What FATCA means for them |
|---|---|
| An Iranian national who has obtained a Dominica passport, lives in Dubai and has no connection with the United States | states on the bank's form that they are not a US taxpayer; FATCA reporting about them does not arise. The CRS applies according to their tax residence |
| A US citizen who has also become a Dominica citizen and opens an account in Dominica | remains a US taxpayer; the Dominica bank reports the account to the IRS through the Government of Dominica, under Model 1 |
| A company in which a US taxpayer holds a substantial interest | may be reported; this is the case of a "foreign entity with US ownership" |
These examples only show the mechanism. Who counts as a "US taxpayer" has its own rules, which a US tax adviser should explain.
Practical points
- **A second passport does not remove US tax status.** If you are a US taxpayer, obtaining Dominica or Vanuatu citizenship does not change that.
- **Fill in bank forms correctly.** Wrong answers to questions about tax residence and US connections can lead to account closure or legal problems.
- **Keep your records.** A bank may ask you to explain "US indicia", such as a place of birth or an address in the United States.
- **Talk to an adviser.** If you have any connection with the United States, consult a US tax adviser before opening an account abroad.
Questions to ask your bank
- Under which FATCA framework does your bank work: the country's agreement or direct registration with the IRS?
- Which forms about tax residence and US status must you complete?
- If your situation changes later, for example your country of tax residence, how and by when must you tell the bank?
- To which country is your information reported under the CRS?
Ask for the answers in writing and keep them with your account records.
Royal Golden does not give tax advice. This article is general information and not tax or legal advice.
Sources
- US Department of the Treasury, Foreign Account Tax Compliance Act and the table of agreements — https://home.treasury.gov/policy-issues/tax-policy/foreign-account-tax-compliance-act (checked on 24 October 2026)
- US Internal Revenue Service, FATCA governments — https://www.irs.gov/businesses/corporations/fatca-governments (via the search index; checked on 24 October 2026)
- US Internal Revenue Service, Instructions for Form 8966 — https://www.irs.gov/instructions/i8966 (via the search index; checked on 24 October 2026)