Information About Criteria for Classifying Customers as Customers - Foreign Taxpayers

INFORMATION ABOUT CRITERIA FOR CLASSIFYING CUSTOMERS OF LIMITED LIABILITY NON-BANKING CREDIT INSTITUTION "PAYPAL RU" AS CUSTOMERS - FOREIGN TAXPAYERS AND HOW TO GET NECESSARY INFORMATION FROM THEM

Hereby Limited Liability Non-Banking Credit Institution "PayPal RU" (hereinafter - "NBCI") informs that the NBCI has signed an agreement with the Internal Revenue Service and NBCI is a Participating Foreign Financial Institution under the US Act "Foreign Account Tax Compliance Act" (hereinafter - "FATCA"). NBCI assigned a unique identification number of the participant (GIIN) - S8TQTQ.00006.ME.643.

On the basis of the provisions of the Federal Law of 28.06.2014, No. 173-FZ "On Specifics of Carrying Out Financial Transactions with Foreign Citizens and Legal Entities, on amendments to the Code of Administrative Offences and on Abolishment of Certain Legislative Acts of the Russian Federation" (hereinafter - "173-FZ") and FATCA, NBCI make informed and reasonable in the circumstances, including measures to identify persons entering into (concluded) contract with NBCI for the provision of financial services (hereinafter - the "Customer"), persons who are subject to the legislation of a foreign state on the taxation of foreign accounts (hereinafter - "Customer foreign taxpayer").

PROCEDURES FOR THE IDENTIFICATION OF INDIVIDUAL CUSTOMER (INCLUDING INDIVIDUAL ENTREPRENEURS) TO DETERMINE THEIR BELONGING TO THAT OF THE US PERSONS IN ACCORDANCE WITH THE REQUIREMENTS OF FEDERAL LAW № 173-FZ AND FATCA

Upon application of the individual Customer (including individual entrepreneurs) after July 1, 2014 to the NBCI for the purpose of opening a Financial account in the form of a personal personalized electronic payment instrument of an individual (hereinafter - "PEPI IN") or non-personalized electronic payment instrument of an individual (hereinafter - "NPEPI IN"), as well as corporate electronic payment instrument (hereinafter - "CEPI IE") for individual entrepreneurs, a new individual Customer (individual entrepreneur) shall undergo the online identification procedure in accordance with the requirements of 173-FZ and FATCA.

Based on the requirements of Federal Law of 27.06.2011, No.161-FZ "OnNational Payment System" (hereinafter - "161-FZ"), internal documents of the NBCI and provisions of the PayPal User Agreement, the applicable limits of balances of PEPI IN, NPEPI IN and CEPI LE at the end of each business day shall not exceed the threshold values set for the emergence of the NBCI obligation on the formation and submission of reports to the Federal Revenue Service of the USA in relation to individual Customers (including individual entrepreneurs), but, in the event of a change in applicable law or internal policy in the future, the NBCI may request the Customer to submit information and documents necessary to comply with FATCA requirements.

The NBCI reserves the right not to enter into, or, depending on circumstances, within 90 days from the date of online identification, to terminate existing PayPal User Agreements with those individuals and individual entrepreneurs, for whom reporting shall be formed and submitted to the Federal Revenue Service of the United States.

The criteria for identifying signs of a foreign taxpayer for individual Customer (including individual entrepreneurs) in accordance with 173-FZ:

1. An individual (individual entrepreneur) simultaneously with the citizenship of the Russian Federation has the citizenship of a foreign state (except for the nationality of a member of the Customs Union);
2. An individual (individual entrepreneur) has a residence permit in a foreign country.

The criteria for identifying US indicia for individuals (individual entrepreneurs) in accordance with the FATCA:

1. Designation of the account holder as a U.S. citizen or resident;
2. A U.S. place of birth;
3. A current U.S. residence address or U.S. mailing address (including a U.S. post office box);
4. A current U.S. telephone number (regardless of whether such number is the only telephone number associated with the account holder);
5. Standing instructions to pay amounts from the account to an account maintained in the United States;
6. A current power of attorney or signatory authority granted to a person with a U.S. address;
7. An “in-care-of” address or a “hold mail” address that is the sole address for the account holder;
8. The presence of other US indicia in the NBCI and in PayPal Group.

PROCEDURES FOR THE LEGAL ENTITY TO DETERMINE THEIR BELONGING TO THAT OF THE US PERSONS IN ACCORDANCE WITH THE REQUIREMENTS OF FEDERAL LAW № 173-FZ AND FATCA

Upon application of the legal entity Customer after July 1, 2014 to the NBCI for the purpose of opening a corporate electronic payment instrument of the legal entity (hereinafter - "CEPI LE”), a new legal entity Customer shall undergo the procedure of online identification within 90 calendar days, in accordance with the requirements of 173-FZ and FATCA.

Based on the requirements of 161-FZ, the PayPal User Agreement, as well as internal documents of the NBCI, the applicable limits for balances of CEPI LE shall not exceed the threshold values set for the emergence of the NBCI obligation on the formation and submission of reporting to the Federal Revenue Service of the USA in respect of legal entities, but, in the event of a change in applicable law or internal policy in the future, the NBCI may request the Customer to submit information and documents necessary to comply with FATCA requirements.

The NBCI reserves the right not to enter into, or, depending on circumstances, within 90 days from the date of online identification, to terminate existing PayPal User Agreements with those legal entities, for which reporting shall be formed andsubmitted to the Federal Revenue Service of the United States.

Currently, the NBCI shall not open bank accounts for legal entities for performing transactions with monetary funds. In case of a review of NBCI internal documents and taking a decision on the beginning of work with legal entities for opening bank accounts to perform transactions with monetary funds, these Financial Accounts of legal entities will be subject to the procedure for the formation and submission of reporting to the Federal Revenue Service of the U.S. in compliance with FATCA.

If the identification of the legal entity Customer has confirmed that the Customer has the status of a Passive Non-Financial Foreign Entity in accordance with Chapter 4 of the FATCA legislation, and if such Customer has at least one Specified US person, such a Customer shall be denied opening a Financial Account.

If the online identification of the legal entity Customer has confirmed that the Customer has the status of a Non-Participating Foreign Financial Institution or is recalcitrant in accordance with Chapter 4 of the FATCA legislation, such a Customer shall be denied opening a Financial Account.

The criteria for identifying signs of a foreign taxpayer for legal entities in accordance with 173-FZ:

1. Legal entity created in accordance with the legislation of the Russian Federation;
2. More than 10 (ten) percent of the shares (stakes) in the authorized capital of a legal entity controlled directly or indirectly not by the Russian Federation and (or) are not citizens of the Russian Federation, except for citizens who have together with Russian Federation citizenship of a foreign state (except for the nationality of the State - member of the Customs Union), as well as having a residence permit in a foreign country.

The criteria for identifying US indicia for legal entities in accordance with the FATCA:

1. A current U.S. residence address or U.S. mailing address;
2. The presence of the US tax resident status;
3. With respect to an offshore obligation, standing instructions to pay amounts to a U.S. address or an account maintained in the United States;
4. A current telephone number for the entity in the United States but no telephone number for the entity outside of the United States;
5. A current telephone number for the entity in the United States in addition to a telephone number for the entity outside of the United States;
6. A power of attorney or signatory authority granted to a person with a U.S. address;
7. An “in-care-of” address or “hold mail” address that is the sole address provided for the entity;
8. Availability of control (direct or indirect) on the part of citizens and / or tax residents of the United States;
9. The presence of other US indicia in the NBCI and in PayPal Group.

WAY TO GET INFORMATION FROM THE CUSTOMERS HAVING THE FEATURES WITH THE STATUS OF US PERSONS

NBCI directly or through third parties, who have the right identification of customers using legitimate methods of obtaining information to identify persons with signs of a person with the status of the United States, including the following methods:

1. The survey, including in the framework of the online identification of the Customer;
2. Filling of Customer a form for self-certification FATCA (W-9 / W-8BEN / W-8BEN-E / W-8IMY / W-8ECI / W-8EXP);
3. Analysis of the available information on the Customer;
4. Other methods, reasonable and adequate in a given situation.