They are all terms associated with the U.S. legislation enacted by the US government with the objective of gathering information about U.S. persons for tax reporting purposes. • FATCA is "Foreign Account Tax Compliant Act" and refers to this new legislation • IRS is "Internal Revenue Service" of the U.S., the tax agency of the US • IGA is "Inter Governmental Agreement", an agreement between governments to share information (in this case it refers specifically to an agreement between the US Government and another jurisdiction's government) • TIN is "Tax Identification Number" of all U.S. taxpayers. A unique number assigned to each US tax payer. It can also be a Social Security Number (SSN).. • A U.S. person has a broad definition under FATCA legislation and equates to those individuals who are required to pay US taxes. U.S. persons are not always defined through nationality or place of birth. The FATCA indicia are used to assist with identification of a U.S. person. • U.S. "indicia" are indicators of that an individual is a U.S. person or that they are potentially a U.S. person. These "indicia" are as follows: For Individuals: • U.S. Nationality (Additional Nationalities for those with dual Nationality) • Country and place of Birth (when this is somewhere in the U.S.) • Green Card Holder • Power of Attorney or Signatory Authority with a U.S. address • "In care of" or "Hold Mail" customers (where the beneficial owner has a U.S. address) • U.S. telephone number or address> • Standing Instructions to remit funds periodically to a U.S. account For Entities: For Entities (Non Financial Foreign Entities - NFFEs), which are typically Companies/ Businesses of all sizes, the following types of company are exempted: • Entity Incorporated in the U.S. (Country of incorporation or parent co-country of incorporation) • Entity listed on a recognized Stock Exchange • Entity that is an exempt entity under FATCA (Government entities, tax exempt Retirement Funds and Trusts, and tax exempt Charities or Not for Profit entities) • Entity that is an Active entity (earns > 50% of it income from non passive sources) In the event that an entity is not one of the above categories, it is likely to be a Passive entity and therefore one for which we are required to establish if there are any Substantial U.S. Beneficial Owners (SBOs). In the case of entities the legislation requires us to identify the individual entity owners and whether these individuals are U.S. persons. Fortunately, many entities will be exempt from reporting any information on their U.S. owners if they already publish their shareholder information in the public domain or for any of the other reasons listed above. • Entity that are Passive (earns > 50% of it income from passive sources*) need to identify Substantial Beneficial Owners having > 10% Ownership (At SBO level for all shareholders/ directors/ partners that are U.S. persons/ Nationals holding more than 10% stake) * See first 2 bullets of definition of "Qualifying withholdable payments" in Q 10 below for an understanding of what "Passive sources" refers to. 2. Why is it necessary for Mashreq to be registered as a Participating Foreign Financial Institution (PFFI) under FATCA? The consequences of being a Non Participating Foreign Financial

The consequences of being a Non Participating Foreign Financial Institution (NPFFI) are not in either the interest of the Bank or its customers as FATCA related withholding tax of 30% will be automatically applied by PFFIs around the world on all NPFFIs on withholdable amounts. This will could be inconvenient for our customers who will then need to claim refunds from the U.S. IRS after proving that they are non U.S. persons, and not liable for tax in the U.S.

Mashreq intends to be FATCA-compliant with effect from 1st July, 2014 in accordance with the directives received from its Regulator. Under this obligation, new customer onboarding processes requires Mashreq to identify U.S. persons while opening deposit/ investment accounts of any kind. In addition, existing customers having U.S. indicia (both U.S. Persons and Non U.S. persons) will need to be identified, and will form part of the reporting process to the U.S. IRS through the local Regulator. We will identify existing clients as U.S. Reportable or Non U.S. Reportable, by seeking an appropriate self-declaration from clients with any U.S. indicia. Those clients having any U.S. indicia that do not provide the required declaration will be flagged and reported as "Recalcitrant".

As per the directive, all accounts (new and old) with U.S. indicia will need to be reported. However, timelines vary for reporting of new accounts versus existing accounts. There is no direction as yet on when balance/ transaction reporting will commence, or whether this will be retrospective or not. It is however, likely to commence for certain individuals from September 2015 and include balances as on a Reporting Date for the 2014 financial year (clarity on what exactly will be reported is awaited).

Withholding will not be required in the following circumstances: • Where customers belong to a PFFI in a Model 1 IGA Country such as the UAE. • Where a customer self declares that they are a "U.S. person" on our FATCA Form and T&C (usually applies to U.S. Nationals or those with U.S. domicile), provides a TIN and completes the W9 form • Where a customer self declares they are a "non U.S. person" on our FATCA Form and T&C and completes a W8 BEN form as required when any of the U.S. indicia are detected • Where an entity customer is found to be exempted from FATCA and provide sufficient documentary evidence to demonstrate this • Where an entity customer is found to be a passive NFFE and completes the W8BENE form declaring any U.S. substantial beneficial owners

Forms are available in the following links: • http://www.irs.gov/pub/irs-pdf/fw8ben.pdf • http://www.irs.gov/pub/irs-pdf/fw8bene.pdf • http://www.irs.gov/pub/irs-pdf/fw9.pdf

Yes. A joint account which has one U.S. owner is treated as a U.S. account and the entire account is reportable under FATCA legislation.

In the case of partially owned entities, provided the entity itself is not an FFI or otherwise exempted, if a U.S. person is revealed as a Substantial Beneficial Owner (SBO), reportable information for that account will include account number, account balance, TIN of U.S. SBO, name of U.S. SBO and address of U.S. SBO.

If you have any U.S. indicia, you will need to declare whether you are a U.S. person or not and fill the appropriate IRS Form (W-9 for U.S. persons and W-8 BEN for Non U.S. persons). U.S. persons will have their details reported to the U.S. IRS by Mashreq through the local Regulator. Should you choose not to make a declaration despite U.S. indicia existing; your account will be classified as "Recalcitrant" " and will also be included in the reporting.

There will be mandatory reporting of consolidated recalcitrant account balances as well as the number of recalcitrant accounts held by every FATCA compliant FFI in IGA – Model 1 countries. In addition, PFFIs (FATCA compliant Banks) may also be obliged to close Recalcitrant accounts after a certain period of time. In non IGA/ IGA Model 2 jurisdictions a withholding tax of 30% imposed on any qualifying U.S. source withholdable payments. Qualifying withholdable payments are defined as: • Any payment of interest (including portfolio interest and original issue discount), dividends, rents, royalties, salaries, wages, annuities, licensing fees and other FDAP income, gains, and profits, if such payment is from sources within the United States • Any gross proceeds from the sale or disposition of U.S. Property of a type that can produce interest or dividends • Interest paid by foreign branches of U.S. banks Certain "foreign pass-through" payments will also be subject to FATCA withholding at a future date. These are defined as any payments that are attributable to U.S. source income.

No. The mere transfer of money from someone in the U.S. to someone in a foreign country will not automatically trigger FATCA withholding if it does not meet the above criteria. However, money transferred into, and income earned in, a U.S. account may be subject to FATCA reporting/ withholding requirements.

Mashreq would strongly advise that U.S. customers contact their respective U.S. tax advisors with respect to questions regarding application of these provisions.

While the IRS is still finalizing all the Reporting requirements, it is likely to include but may not be limited to the following information with respect to each customer defined as a U.S. Reportable: • Name, address and TIN of each account holder that is a specified U.S. person • If the account holder is a Passive Non Financial Foreign Entity (NFFE), the name, address and TIN of each substantial beneficial owner (owning > 10%) of that entity that is a U.S. person • Account Number • Account balance or value AND • At a future date the gross receipts and gross withdrawals or payments from the account (except to the extent provided by the IRS) The IRS will provide a template for this reporting which will need to be submitted electronically by Mashreq with the IRS (through the local Regulator) in the year following the calendar year that is the subject of reporting (Eg: For 2015 data, the Reporting must happen by September 2016).