Common Reporting Standard (CRS): the global standard for tax transparency and its impact on Andorra

Reading time: 9 minutes

🏁 Introduction

For decades, banking secrecy symbolised financial sovereignty. However, international crises and G20 pressure reshaped that notion — tax transparency became a shared global value.

The Common Reporting Standard (CRS) — also known as the Automatic Exchange of Information (AEOI) framework — is the global response to cross-border tax evasion.

Designed by the OECD in 2014, this system requires financial institutions to report data on non-resident accounts to their domestic tax authorities, which then exchange the information automatically with other jurisdictions.

➤ To understand how European tax harmonisation emerged and its impact on corporate mobility, read Exit tax in the European Union: key tax aspects of business and asset transfers.

🧭 Origin and purpose of the CRS

The CRS originated from a G20 initiative approved by the OECD in July 2014, inspired by the U.S. FATCA (Foreign Account Tax Compliance Act).

➤ For a detailed look at how the U.S. system works and how it differs from the CRS, see our article FATCA: the model that reshaped global tax transparency.

Directive 2014/107/EU (known as DAC2) incorporated this standard into EU law, requiring Member States to share tax information automatically and periodically.

🎯 Main objectives of the CRS:

• Combat global tax evasion and the use of tax havens.
• Strengthen transparency and international cooperation.
• Ensure fairer taxation and reduce disparities between countries.

⚙️ How the Automatic Exchange of Information (AEOI) works

The mechanism is straightforward, yet its impact is profound:

• Identification: financial institutions (banks, insurers, investment funds, etc.) identify account holders who are non-residents.
• Reporting: they transmit the data to their national tax authority.
• Exchange: tax authorities automatically share this information with countries where those individuals or entities are tax residents.

📊 Information exchanged includes:

• Account holder’s name, address, and tax identification number (TIN).
• Account number and type.
• Balance or value of financial assets.
• Income earned: interest, dividends, capital gains, and redemptions.

⚠️ Important: the CRS only covers financial account information managed by authorised institutions such as banks or insurers. It does not include general tax data, business assets, real estate, or personal information unrelated to financial accounts. Exchanges occur annually, and confidentiality is safeguarded by strict data-protection rules derived from Article 25 of Directive 2011/16/EU and the EU Charter of Fundamental Rights.

🌐 Global reach and adoption

The CRS has been adopted by more than 100 jurisdictions. The first exchanges took place in 2017, and the network has continued to expand ever since.

Participating countries include:

• All EU Member States.
• Major financial centres such as Switzerland, Singapore, the United Arab Emirates, Hong Kong, and Canada.
• Traditionally opaque offshore territories that joined the system to avoid sanctions or financial isolation.

👉 This framework replaced the need for bilateral information requests with a continuous, structured flow of data between tax administrations.

➤ For a broader perspective on the evolution of international tax cooperation, see International taxation and wealth planning: how to protect your legal structure.

⚠️ Non-participating or limited-cooperation jurisdictions

Although more than a hundred countries apply the CRS, some remain non-cooperative or only partially compliant:

• The United States, which maintains its own FATCA regime and does not fully participate in the CRS.
• Certain Middle Eastern and Caribbean territories where implementation is incomplete or merely formal.
• A few opaque tax jurisdictions that fail to ensure true reciprocity.

The OECD and the European Union regularly update the list of non-cooperative jurisdictions, which can affect market access and international credibility.

➤ See the full list of non-cooperative countries on the OECD website.

🇪🇺 The European Union and the DAC directives

The European Union has expanded the initial CRS framework through a series of Administrative Cooperation Directives (DAC):

• DAC2 (2014/107/EU): implements the OECD CRS within the EU.
• DAC6 (2018/822/EU): requires reporting of potentially aggressive tax-planning schemes.
• DAC7 (2021/514/EU): extends reporting obligations to digital platforms and marketplaces.

These directives have made the EU a global leader in tax transparency and cross-border cooperation.

➤ To explore how the EU continues to strengthen its common tax framework, read The Association Agreement between Andorra and the European Union: towards deeper economic integration.

🇦🇩 Andorra and the CRS

Although not part of the European Union, Andorra adopted the CRS as part of its international commitment to transparency and regulatory alignment.

📘 Andorran legal basis:

• Law 19/2016 of 30 November on the automatic exchange of tax information.
• Decree of 3 October 2018 approving its implementing regulation.

Since 2018, Andorra has exchanged information with the EU, Switzerland, and over 100 other jurisdictions, consolidating its reputation as a safe and cooperative country.

👉 For Andorran residents with international assets, the CRS brings transparency but also legal certainty: information is used exclusively for tax purposes and under strict confidentiality safeguards.

➤ To learn more about Andorra’s tax framework and its competitive advantages, see Taxation in Andorra: general framework and key benefits.

➤ And if you are considering relocating, we recommend Tax residency in Andorra: requirements and legal advantages.

🔮 Challenges and future outlook

Despite its success, the CRS still faces challenges:

• 🌐 Uneven implementation: some countries apply less stringent due-diligence standards.
• 🔒 Data privacy: information leaks remain a concern.
• 🪙 New asset classes: cryptocurrencies and decentralised structures are not yet covered.
• 💼 Regulatory evolution: the OECD and the EU are exploring an extension of the CRS to crypto-assets and trust structures.

⚠️ The upcoming Crypto-Asset Reporting Framework (CARF), designed to complement the CRS, represents a decisive step in that direction.

➤ Learn more about this topic in Taxation of crypto-assets in Andorra: towards a regulated and secure framework.

Conclusion

The Common Reporting Standard represents a new era of transparency and international cooperation.
Over a hundred countries exchange financial data annually to curb tax evasion and strengthen the integrity of the global financial system.

➤ See the complete list on the official OECD page.

In this context, Andorra stands out as a trustworthy country aligned with OECD and EU standards — offering a competitive tax framework without compromising transparency.

👉 Do you manage international assets or investments?
At ELYSIUM Consulting, we help you structure your wealth safely and efficiently, ensuring compliance with international standards while maintaining the highest level of discretion.
Feel free to schedule a meeting or contact us through our form.

Last updated: November 2025