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OECD Unveils Global Real Estate Transparency Framework Targeting Cross-Border Property Holdings · IMI Podcasts

• 0:00
  SPEAKER_00: The Organization for Economic Cooperation and Development, also known as OECD, has delivered a framework to G20 finance ministers that extends automatic tax information exchange to immovable property.
• 0:12
  SPEAKER_00: The Multilateral Competent Authority Agreement on the Exchange of Readily Available Information on Immovable Property, referred to as IPIMCAA, approved by the OECD Committee on Fiscal Affairs in May 2025, creates standardized channels for tax authorities to share data on cross-border real estate ownership, transactions, and income.
• 0:34
  SPEAKER_00: This marks the third pillar of global tax transparency architecture.
• 0:38
  SPEAKER_00: Financial accounts were subject to automatic exchange through the Common Reporting Standard, referred to as CRS, in 2014.
• 0:46
  SPEAKER_00: While cryptocurrency reporting was introduced via the Crypto Asset Reporting Framework, also known as CARF, in 2022.
• 0:54
  SPEAKER_00: Real estate remained the final major asset class operating largely outside automatic reporting systems.
• 1:01
  SPEAKER_00: Tax administrations have historically maintained limited visibility over foreign property holdings, despite mounting evidence of compliance risks.
• 1:09
  SPEAKER_00: The OECD's 2023 report to the G20 on real estate transparency documented that cross-border property holdings have grown substantially while remaining frequently underreported.
• 1:21
  SPEAKER_00: Studies cited in that report suggest wealthy individuals increasingly use foreign real estate to shelter assets that would otherwise trigger CRS reporting on financial accounts.
• 1:31
  SPEAKER_00: The new framework addresses what participating governments view as a structural weakness in international tax enforcement.
• 1:38
  SPEAKER_00: Offshore entities, trusts, or nominee arrangements holding property have functioned as a de facto exemption from the transparency standards tax authorities apply to bank accounts and investment portfolios.
• 1:49
  SPEAKER_00: The IPIMCAA applies the same automatic exchange methodology to buildings and land.
• 1:55
  SPEAKER_00: The agreement operates through two distinct modules that participating jurisdictions can adopt independently or together.
• 2:03
  SPEAKER_00: Module 1 focuses on ownership visibility through a one-time exchange of existing property holdings, plus annual reporting of new acquisitions.
• 2:11
  SPEAKER_00: Module 2 targets income transparency by requiring annual exchanges of disposal transactions and recurrent rental or lease income.
• 2:20
  SPEAKER_00: Countries opting into either module commit to sharing what the framework defines as readily available information.
• 2:27
  SPEAKER_00: This encompasses data that is electronically captured, searchable, and sortable within tax administration databases, or in property and beneficial ownership registries to which tax authorities have direct access.
• 2:39
  SPEAKER_00: The framework generally does not include information that administrators store in PDF format, paper records, or systems requiring item-by-item manual retrieval, though tax administrations may choose to include such information when they consider it readily available.
• 2:55
  SPEAKER_00: Each exchange must include a minimum data set specified in the agreement's annex.
• 3:00
  SPEAKER_00: For individuals, this requires a name plus any of the following: a resident tax identification number, date of birth, or residence address in the relevant jurisdiction.
• 3:10
  SPEAKER_00: Property data must include an address or unique identifier plus price or value.
• 3:15
  SPEAKER_00: Records missing.
• 3:17
  SPEAKER_00: Minimum data set elements are not appropriate for exchange until corrected through the remediation process outlined in the agreement.
• 3:24
  SPEAKER_00: Optional data fields expand intelligence value when readily available.
• 3:28
  SPEAKER_00: These include financing information revealing whether cash or leverage finance the acquisition, fractional ownership structures, mode of acquisition, distinguishing purchases from gifts or inheritances, and taxes paid, enabling foreign tax credit verification.
• 3:44
  SPEAKER_00: The agreement's most consequential provision addresses entity-held property.
• 3:48
  SPEAKER_00: When real estate sits within corporate structures, trusts, or foundations, the framework requires the exchange of beneficial owner information where such data exists in a readily available form.
• 4:00
  SPEAKER_00: The IPIMCAA defines beneficial owners as individuals exercising ultimate effective control over entities, aligning with Financial Action Task Force, referred to as FATF, anti-money laundering standards.
• 4:15
  SPEAKER_00: The framework does not impose new collection or due diligence duties on jurisdictions, but exchanges existing beneficial ownership data where accessible.
• 4:24
  SPEAKER_00: This look-through mechanism directly targets the opacity that complex offshore structures provide.
• 4:30
  SPEAKER_00: A British Virgin Islands company registering property with a Cayman Islands trust as shareholder must now surface the natural person who controls that trust, provided beneficial ownership records exist in readily available form.
• 4:43
  SPEAKER_00: Tax authorities receive identifying information on both the entity and the beneficial owner, with each person's data flowing to their respective jurisdiction of tax residents.
• 4:53
  SPEAKER_00: The framework acknowledges multiple methods for establishing tax residents.
• 4:57
  SPEAKER_00: Beyond formal tax identification numbers and residence certificates, the agreement accepts self-certification of tax residents by individuals or entities.
• 5:06
  SPEAKER_00: This creates flexibility for recent movers and individuals in transition.
• 5:11
  SPEAKER_00: Though tax authorities will cross-reference self-certified residents against CRS financial data, immigration records, and property patterns in third jurisdictions, the IPI MCAA comes into effect between two countries only after both have signed, notified the OECD Secretariat, listed each other as exchange partners, completed domestic legislative procedures, and opted into compatible modules.
• 5:36
  SPEAKER_00: The agreement specifies that exchanges begin January 1st of the year following the second jurisdiction's notification.
• 5:42
  SPEAKER_00: One-off holdings data covering property that owners hold on the date, the bilateral relationship enters into effect must transfer as soon as feasible after bilateral activation, with a hard deadline of January 31st in the following year.
• 5:57
  SPEAKER_00: Annual exchanges of acquisitions, disposals, and income should occur by January 31st each year, covering the preceding calendar year where feasible, though the framework establishes June 30th as the binding deadline to accommodate operational complexity.
• 6:12
  SPEAKER_00: Transmission occurs through the OECD Common Transmission System using standardized XML schemas with encryption protocols.
• 6:21
  SPEAKER_00: The OECD Secretariat maintains a public list of signatories and active bilateral exchange relationships.
• 6:27
  SPEAKER_00: The framework includes fundamental constraints that temper its immediate reach.
• 6:32
  SPEAKER_00: No automatic retroactive exchange applies to holdings or transactions occurring before bilateral activation dates, though earlier periods remain reachable under exchange of information on request, also known as EOIR, provisions or domestic audit powers.
• 6:48
  SPEAKER_00: Property that owners acquired and sold before the two countries activate exchanges faces no automatic reporting obligation under this agreement.
• 6:56
  SPEAKER_00: David Lesperance, managing director of Lesperence and Associates, identifies what he views as a structural vulnerability in the framework.
• 7:04
  SPEAKER_00: The OECD approach faces the fundamental flaw that not all countries are signatories to the CRS, he notes, highlighting that, most notably, the U.S.
• 7:14
  SPEAKER_00: is not a signatory.
• 7:15
  SPEAKER_00: This creates a regularization window extending from 2025 through roughly 2030, as jurisdictions progressively activate bilateral relationships, but the absence of major economies from the framework presents longer-term gaps.
• 7:29
  SPEAKER_00: Wealthy individuals can voluntarily disclose previously unreported holdings, restructure ownership, or liquidate and reposition assets before their residence jurisdiction establishes exchanges with property location countries.
• 7:42
  SPEAKER_00: Data quality varies substantially by jurisdiction type.
• 7:46
  SPEAKER_00: Advanced economies with digitized property registries and robust beneficial ownership databases may achieve 85% to 95% coverage of eligible properties.
• 7:56
  SPEAKER_00: Emerging markets with partial digitization and incomplete beneficial ownership data likely reach 40% to 70% coverage.
• 8:05
  SPEAKER_00: Developing economies in certain offshore jurisdictions may report only 10% to 30% of properties due to paper-based systems and deliberate opacity.
• 8:14
  SPEAKER_00: Beneficial ownership registries present particular challenges.
• 8:18
  SPEAKER_00: The European Union's beneficial ownership directive has faced implementation delays, constitutional court challenges restricting public access, and uneven enforcement, legacy trusts that fiduciaries established before disclosure requirements, foundations in civil law jurisdictions, and layered offshore structures with intermediary holdings often lack digitized beneficial owner records that meet the minimum data set threshold.
• 8:43
  SPEAKER_00: Receiving jurisdictions must confirm that requested information is, quote, foreseeably relevant to the administration or enforcement of its domestic laws concerning the taxes covered by the convention, end quote.
• 8:55
  SPEAKER_00: Some jurisdictions may choose in practice to specify applicable tax types, though the legal requirement centers on confirmation of foreseeable relevance.
• 9:04
  SPEAKER_00: This requirement creates geographic variance in participation scope.
• 9:09
  SPEAKER_00: Jurisdictions without capital gains taxes on foreign property may select only Module 1 for wealth tax or anti-money laundering purposes, leaving disposal transactions unreported.
• 9:20
  SPEAKER_00: Countries applying territorial taxation or exemption methods for foreign income may lack foreseeable relevance for rental income reporting.
• 9:28
  SPEAKER_00: Oil-rich states without income taxes may not participate at all.
• 9:32
  SPEAKER_00: The bilateral opt-in structure means Country A might receive comprehensive Module 1 and Module 2 data from Country B, while Country C opts to send only Module 1 information.
• 9:43
  SPEAKER_00: High net worth individuals face jurisdiction-specific exposure requiring bilateral analysis rather than assumptions of universal transparency.
• 9:52
  SPEAKER_00: The framework fundamentally alters the risk calculus for cross-border property ownership.
• 9:57
  SPEAKER_00: Anonymity through shell companies, offshore trusts, and nominee arrangements becomes progressively untenable as participating jurisdictions build out exchange networks.
• 10:06
  SPEAKER_00: Tax authorities gain the capacity to cross-reference property data against declared income, financial account balances from CRS, and cryptocurrency transactions under CARF.
• 10:18
  SPEAKER_00: A taxpayer reporting average account balances of$200,000 over five years who acquires$2 million in foreign property triggers source of funds investigations.
• 10:29
  SPEAKER_00: Failure to demonstrate legitimate declared income or documented gifts and inheritances results in reassessments, penalties, and potential criminal referrals.
• 10:38
  SPEAKER_00: Rental income from foreign properties becomes visible through both IPIMCAA reporting and existing digital platform reporting for short-term rentals.
• 10:48
  SPEAKER_00: Tax authorities can verify declared rental receipts against reported income, identify undeclared income streams, and calculate whether foreign tax credits claimed for source country taxes align with actual payments.
• 11:00
  SPEAKER_00: Capital gains transparency expands substantially.
• 11:04
  SPEAKER_00: Jurisdictions exercising taxing rights over gains from foreign immovable property receive disposal data, including sale prices, capital gains, and taxes paid.
• 11:13
  SPEAKER_00: Residence jurisdictions applying credit methods to eliminate double taxation can verify that taxpayers properly reported gains and actually paid foreign taxes.
• 11:23
  SPEAKER_00: Wealth and inheritance tax authorities gain visibility over foreign property holdings for net worth calculations.
• 11:29
  SPEAKER_00: Spanish nationals holding Monaco property see Spanish wealth tax bases include those assets.
• 11:35
  SPEAKER_00: French residents with London real estate face transparency on holdings relevant to French inheritance tax obligations.
• 11:41
  SPEAKER_00: Wealthy individuals confront several adaptation pathways through the implementation period.
• 11:47
  SPEAKER_00: Full transparency embrace involves a comprehensive asset inventory, voluntary disclosure of previously unreported holdings before bilateral activation, simplification of entity structures, and elimination of unnecessary offshore vehicles.
• 12:01
  SPEAKER_00: This approach recognizes transparency as inevitable among major economies, and prioritizes proactive compliance over enforcement risk.
• 12:10
  SPEAKER_00: Strategic restructuring suits ultra-high net worth individuals with complex multi-jurisdictional structures.
• 12:17
  SPEAKER_00: This entails jurisdictional arbitrage analysis, migration of holdings to selective reporting locations, conversion of entity-held property to direct ownership where beneficial, and establishment of compliance structures within favorable tax treaty networks.
• 12:32
  SPEAKER_00: The focus shifts from opacity to legitimate structural optimization within transparent frameworks.
• 12:38
  SPEAKER_00: Tactical delay and jurisdiction selection carry a higher risk but remain viable for those prioritizing privacy.
• 12:44
  SPEAKER_00: Lesperence anticipates that individuals who wish to hold real estate in privacy will simply buy either U.S.
• 12:51
  SPEAKER_00: real estate or create U.S.
• 12:52
  SPEAKER_00: holding companies to hold foreign property, exploiting the absence of American participation in the framework.
• 12:59
  SPEAKER_00: This involves concentrating holdings in late adopting jurisdictions, exploiting data quality limitations and incomplete beneficial ownership registries, and accepting permanent exposure concentration in non-participating countries.
• 13:13
  SPEAKER_00: This approach increasingly resembles evasion rather than avoidance, as coverage matures and cross-referencing with other frameworks reveals inconsistencies.
• 13:23
  SPEAKER_00: Asset class rotation redirects wealth into categories lacking current reporting frameworks.
• 13:28
  SPEAKER_00: Fine art, collectibles, precious metals, and certain private equity structures remain outside automatic exchange systems.
• 13:35
  SPEAKER_00: The OECD has indicated active monitoring of these sectors, making this a temporary gap rather than a permanent solution.
• 13:43
  SPEAKER_00: The framework's power multiplies through integration with existing transparency systems.
• 13:48
  SPEAKER_00: Tax authorities now overlay CRS financial data, CARF cryptocurrency reporting, IPIMCAA property information, and digital platform short-term rental receipts into comprehensive taxpayer profiles.
• 14:03
  SPEAKER_00: Advanced jurisdictions deploy artificial intelligence-driven wealth reconstruction algorithms that aggregate automatic exchange data, flag inconsistencies between reported income and asset accumulation, model expected wealth trajectories based on declared earnings, and generate audit risk scores.
• 14:21
  SPEAKER_00: The IPIMCAA provides the final major input needed for these systems to approach completeness.
• 14:28
  SPEAKER_00: Information use remains limited to tax administration and enforcement under convention provisions, though national laws in some jurisdictions may authorize further sharing with anti-money laundering financial intelligence units, anti-corruption agencies investigating illicit enrichment, sanctions enforcement identifying concealed assets, and criminal investigation units tracking proceeds of crime.
• 14:51
  SPEAKER_00: The tax transparency framework becomes a comprehensive financial intelligence infrastructure serving multiple enforcement objectives where domestic legal gateways permit.
• 15:01
  SPEAKER_00: Early movers between 2026 and 2028 likely include core European Union states with advanced property registries, Anglo Sphere jurisdictions with digitized systems, and Nordic countries with comprehensive tax infrastructures.
• 15:16
  SPEAKER_00: Initial exchanges will focus on Module 1 with partial beneficial ownership data, concentrating on high-value properties in major urban markets.
• 15:24
  SPEAKER_00: Broader adoption from 2028 to 2031 brings G20 emerging markets under peer pressure, European Union accession candidates, and selected Latin American and Asian economies.
• 15:36
  SPEAKER_00: Module 2, activation begins, beneficial ownership registries mature, and coverage expands to secondary cities and regional property.
• 15:45
  SPEAKER_00: Estimated coverage reaches 60% to 75% of eligible properties.
• 15:50
  SPEAKER_00: Maturity arrives between 2031 and 2035 with near universal adoption among OECD and EU states.
• 15:57
  SPEAKER_00: Though permanent gaps persist in jurisdictions with weak state capacity, property markets dependent on foreign anonymous capital and regimes prioritizing data sovereignty over international cooperation.
• 16:10
  SPEAKER_00: Coverage stabilizes at 80% to 90% in participating jurisdictions.
• 16:15
  SPEAKER_00: All exchanges remain subject to convention confidentiality rules and data safeguards that supplying jurisdictions specify under domestic law.
• 16:23
  SPEAKER_00: Any jurisdiction can immediately suspend exchanges with another for significant noncompliance, including confidentiality breaches, data safeguard failures, or inadequate reporting.
• 16:35
  SPEAKER_00: Termination requires 12 months' notice.
• 16:37
  SPEAKER_00: The system depends on mutual trust and technical competence.
• 16:41
  SPEAKER_00: Data breaches or political disputes can halt bilateral exchanges.
• 16:45
  SPEAKER_00: Jurisdictions with weak cybersecurity infrastructure may face suspension demands.
• 16:50
  SPEAKER_00: Authoritarian regimes potentially using tax data for political surveillance could trigger non-participation by democratic states.
• 16:57
  SPEAKER_00: This political and technical fragility means coverage will remain uneven, contested, and subject to interruption.
• 17:04
  SPEAKER_00: The framework advances through voluntary cooperation rather than binding enforcement, creating ongoing vulnerability to deteriorating international relations or domestic political shifts.
• 17:15
  SPEAKER_00: Implementation delays, data quality limitations, and political resistance cannot reverse the fundamental trends international tax architecture now embeds.
• 17:24
  SPEAKER_00: Once jurisdictions adopt automatic exchange, reversion to opacity becomes politically and reputationally prohibitive for countries seeking global economic integration.
• 17:34
  SPEAKER_00: The CRS has experienced zero rollbacks since implementation.
• 17:38
  SPEAKER_00: Data accumulation creates permanent records that grow more comprehensive over time.
• 17:43
  SPEAKER_00: Properties absent from initial exchanges appear in subsequent years with backdated ownership information as systems improve.
• 17:50
  SPEAKER_00: Each additional participating jurisdiction increases pressure on non-participants through network effects that stigmatize remaining opacity.
• 17:58
  SPEAKER_00: Younger generations of wealthy individuals and inheritors have spent their entire adult lives in the post-CRS transparency era.
• 18:05
  SPEAKER_00: They view compliance as a default rather than an imposition.
• 18:09
  SPEAKER_00: The cultural shift toward transparency is generational and irreversible.
• 18:13
  SPEAKER_00: Technology investments in digital property registries, beneficial ownership databases, and XML transmission infrastructure create path dependency.
• 18:22
  SPEAKER_00: Once jurisdictions build these systems, they operate at near zero marginal cost, making continued participation rational even for initially reluctant jurisdictions.
• 18:32
  SPEAKER_00: The IPIMCAA represents not a sudden enforcement shock, but progressive opacity reduction over five to ten years.
• 18:40
  SPEAKER_00: Strategic choices that individuals make between 2025 and 2027 will determine whether high net worth individuals adapt successfully or face enforcement consequences as bilateral exchange networks mature.
• 18:53
  SPEAKER_00: The framework completes the triad of automatic exchange covering financial accounts, cryptocurrency, and real estate.
• 19:00
  SPEAKER_00: Tax authorities in participating jurisdictions gain comprehensive visibility over the major stores of global wealth.
• 19:06
  SPEAKER_00: The remaining question concerns implementation pace and geographic coverage rather than directional trajectory.
• 19:13
  SPEAKER_00: Wealthy individuals confront a narrowing window for restructuring, voluntary disclosure, and compliance alignment before their residence jurisdictions activate exchanges with property location countries.
• 19:24
  SPEAKER_00: The absence of automatic retroactive reporting provides breathing room, but only for those who act before bilateral relationships go live, as earlier periods remain accessible through EOIR mechanisms.
• 19:36
  SPEAKER_00: The OECD has constructed an architecture that presumes progressive adoption through economic and reputational incentives rather than binding mandates.
• 19:46
  SPEAKER_00: Whether this proves sufficient to achieve near universal coverage depends on the same forces that drove CRS adoption, peer pressure among major economies, technical assistance for developing countries, and the growing costs of exclusion from transparent financial systems.
• 20:02
  SPEAKER_00: L'Esporence draws parallels to other multilateral tax initiatives that foundered on incomplete participation.
• 20:08
  SPEAKER_00: He predicts the framework will follow the trajectory of Gabriel Zuckman's global billionaire tax proposal and crash in sink on the reality rock that there will be some countries like the U.S.
• 20:19
  SPEAKER_00: which will not adopt such proposals.
• 20:22
  SPEAKER_00: What remains certain is that real estate secrecy, long the final refuge for undeclared wealth, now faces the same international transparency standards that collapsed offshore banking anonymity over the past decade among participating jurisdictions.
• 20:37
  SPEAKER_00: The IPIMCAA provides the legal and technical infrastructure.
• 20:42
  SPEAKER_00: Implementation determines only the timeline, not the outcome.
• 20:47
  SPEAKER_00: This episode first appeared as an article by Ahmad Abbas on IMIDaily.com.
• 20:53
  SPEAKER_00: Subscribe for free to the IMI newsletter for breaking news and updates from the investment migration industry, and upgrade your membership to IMI Pro to get access to our exclusive professional community, citizenship catalog, investment migration company Rolodex, private briefings, and more members only content.