Acta Francisci Pp. 659

by Nonparticipating Financial Institutions that are not established in the jurisdiction where such Related Entity or branch is located, and such Related Entity or branch is not used by the HS/VCS Financial Institution or any other Related Entity to circumvent the obligations under this Agreement or under section 1471 of the U.S. Internal Revenue Code, as appropriate.

6. Coordination of Timing. Notwithstanding paragraphs 3 and 5 of Article 3 of this Agreement:

a) the HS/VCS shall not be obligated to obtain and exchange infor- mation with respect to a calendar year that is prior to the calendar year with respect to which similar information is required to be reported to the IRS by participating FFIs pursuant to relevant U.S. Treasury Regulations; and

b) the HS/VCS shall not be obligated to begin exchanging informa- tion prior to the date by which participating FFIs are required to report similar information to the IRS under relevant U.S. Treas- ury Regulations.

7. Coordination of Definitions with U.S. Treasury Regulations. Notwith- standing Article 1 of this Agreement and the definitions provided in the Annexes to this Agreement, in implementing this Agreement, the HS/VCS may use, and may permit HS/VCS Financial Institutions to use, a definition in relevant U.S. Treasury Regulations in lieu of a corresponding definition in this Agreement, pro- vided that such application would not frustrate the purposes of this Agreement.

Article 5 collABorAtion on compliAnce And enforcement

1. General Inquiries. Subject to any further terms set forth in a competent authority agreement concluded pursuant to paragraph 6 of Article 3 of this Agree- ment, the U.S. Competent Authority may make follow-up requests to the HS/ VCS Competent Authority, pursuant to which the HS/VCS Competent Authority shall obtain and provide additional information with respect to a U.S. Reportable Account, including the account statements prepared in the ordinary course of a Reporting HS/VCS Financial Institution's business that summarize the activity (including withdrawals, transfers, and closures) of the U.S. Reportable Account.

2. Minor and Administrative Errors. The U.S. Competent Authority shall no- tify the HS/VCS Competent Authority when the U.S. Competent Authority has reason to believe that administrative errors or other minor errors may have led to