The Role of the OECD in CARF

The Organisation for Economic Co-operation and Development (OECD) is the architect of the Crypto-Asset Reporting Framework. Understanding the OECD's role helps explain how CARF was designed and how it will evolve.

What is the OECD?

The OECD is an intergovernmental economic organization founded in 1961 with 38 member countries. Its mission is to promote policies that improve economic and social well-being globally.

Key characteristics:

• Forum for governments to develop economic and social policy
• Produces internationally agreed standards and frameworks
• Members include most major economies
• Works with non-member countries on specific initiatives

OECD Tax Transparency Work

The OECD has led international tax transparency efforts for decades:

Model Tax Convention

The OECD Model Tax Convention provides the basis for bilateral tax treaties between countries, establishing rules for taxing cross-border income.

Common Reporting Standard (CRS)

Developed in 2014, CRS established automatic exchange of financial account information between jurisdictions. Over 100 jurisdictions now participate.

Base Erosion and Profit Shifting (BEPS)

The BEPS project addresses tax avoidance strategies used by multinational enterprises, establishing new standards for international taxation.

CARF represents the latest evolution in this work, extending transparency principles to the crypto-asset ecosystem.

CARF Development Process

The OECD followed a structured process in developing CARF:

Working Party Formation

The Working Party on Tax Compliance, comprising tax officials from member countries, led CARF development. Working groups addressed specific technical issues.

Industry Consultation

The OECD conducted extensive stakeholder consultations:

• Public consultation period with written submissions
• Technical discussions with industry representatives
• Coordination with financial industry groups

Model Rules Drafting

OECD staff drafted model rules based on working party direction and consultation feedback. Multiple drafts were reviewed before finalization.

Commentary Development

Alongside rules, the OECD developed detailed commentary providing interpretive guidance—essential for consistent implementation across jurisdictions.

XML Schema Design

The OECD created standardized XML schemas enabling consistent data formatting for automatic exchange.

Ongoing OECD Role

The OECD's involvement continues beyond initial development:

Implementation Support

The OECD provides guidance to jurisdictions implementing CARF:

• Technical assistance for transposing rules into domestic law
• Frequently Asked Questions documents
• Implementation handbook
• Best practices guidance

Monitoring and Review

The OECD monitors implementation and may recommend updates to address:

• Implementation inconsistencies between jurisdictions
• Technical issues identified during rollout
• New crypto-asset types or business models
• Emerging evasion techniques

Framework Updates

CARF will evolve over time. The OECD process for amendments involves:

• Identifying issues requiring attention
• Working party deliberation
• Stakeholder consultation on proposed changes
• Approval by OECD Council
• Communication to implementing jurisdictions

Global Forum on Transparency

The Global Forum on Transparency and Exchange of Information for Tax Purposes plays a key role in CARF implementation:

Membership

The Global Forum includes over 160 jurisdictions—far more than OECD membership—ensuring broad participation in tax transparency standards.

Peer Reviews

The Global Forum conducts peer reviews of jurisdictions' implementation of tax transparency standards. Similar reviews are expected for CARF.

Technical Assistance

The Global Forum provides capacity building for developing countries implementing CARF, ensuring the framework achieves global reach.

Commitment Tracking

The Global Forum maintains the list of jurisdictions committed to CARF implementation and monitors progress against commitments.

Relationship with Other Bodies

The OECD coordinates with other international organizations:

• G20: Provides political mandate and endorsement for OECD tax work
• Financial Action Task Force (FATF): Coordinates on AML aspects of crypto regulation
• Financial Stability Board: Addresses financial stability implications
• European Commission: EU implementation through DAC8

Conclusion

The OECD's role ensures CARF reflects international consensus and best practices. For CASPs, understanding this institutional context helps anticipate how the framework will evolve and where to look for authoritative guidance.