FIA Tech announced its launched a new data service to meet the demands of customers trading futures and options for an accurate, comprehensive data solution designed to assist firms in complying with the tax regulation 871(m).
In September 2015, the US tax authority and the Treasury Department released final regulations under Section 871(m) of the tax Code, which established regulations regarding the withholding of “dividend equivalent payments” on derivatives that reference US equity securities.
For market participants trading in these derivative products, failure to accurately determine products subject to this withholding status as required by the 871(m) regulations may lead to fines, increased scrutiny from regulatory authorities, and costly measures to rectify operational workflows.
By leveraging the vast amounts of exchange traded derivative (ETD) product and underlying reference data within FIA Tech’s Databank Network, 871(m) highlights key attributes of global index derivatives that are utilized to determine if a product is classified as “qualified” or “non-qualified” per IRS regulations.
Andrew Castello, SVP and head of Client Operations at FIA Tech, said in a statement: “Our 871(m) solution is a powerful addition to our end-to-end regulatory support for ETD clients—streamlining compliance in a complex landscape. Delivered in a standardized, consolidated format, it seamlessly integrates with our rich reference data and can be customized with vendor symbologies or other reference data inputs to meet each client’s unique needs.”
FIA Tech’s Databank offering also includes: Corporate Actions, a globally aggregated database which continuously tracks corporate actions announced on equity derivative exchange; Cash & Collateral, a globally collated dataset of acceptable collateral sourced directly from FIA Tech’s CCP partners; and its recently launched Foreign Securities Futures and Sanctioned Securities offerings.