Poland: Limited relief at source service - update for foreign central banks

02.07.2019

Further to Clearstream Banking's1  Announcement A19017, describing a limited relief at source service available to certain entities, our depository Citi Handlowy (the “depository”) recently clarified the rules applicable to foreign central banks.

Effective

immediately

the relief at source service will be granted to foreign central banks on T-bonds purchased after 7 November 2015 regardless of the date of issuance.

Background

As of 29 January 2019, a limited service of relief at source was granted by the depository to central banks receiving interest and discount from bonds issued by the state treasury on the Polish market after 7 November 2015. 

Even though this exemption could have been granted if the shares were purchased after that date, the depository had no possibility to know when the securities were purchased and decided to restrict this exemption to securities that were issued after 7 November 2015.

Since then, Clearstream Banking’s depository have reviewed their procedure and decided to grant an extended service to foreign central banks that can confirm the T-bills were purchased after that date regardless of the date of issuance. 

Impact on customers

Effective immediately, customers wishing to obtain relief at source for final beneficial owners that are foreign central banks must provide in addition to the set of documents already required in A19017, an electronic instruction via SWIFT (MT565, MT568 or MT599), Xact Web Portal or CreationOnline message confirming the eligible holding purchased on or after 7 November 2015, using the first in, first out (FIFO) methodology. The instruction must include: 

  • Account number;  
  • ISIN code;
  • Corporate Action ID;
  • Instructed quantity;
  • Interest payment date;
  • Full contact details;
  • Holders are required to specify:  ”With respect to the interest payment reported above, we hereby confirm that (enter beneficial owner ‘s name) is eligible for the WHT exemption on the following position: (nominal position of T-bonds purchased on or after 7 November 2015), using the FIFO methodology.”
    If this wording is not provided by the customer, Clearstream Banking reserves the right to reject the instruction, and in any case Clearstream Banking could not be held liable for such rejection.

Deadline to provide the instruction

The electronic instruction as well as documentation for the application of the exemption at source or for the disclosure of individuals/legal entities and the purchase price must be provided to Clearstream Banking prior to the payment date by the deadline specified in the related SWIFT MT564.

Further information

For further information, please contact the Clearstream Banking Tax Help Desk, Clearstream Banking Client Services or your Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.