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merely because the Financial Institution (a) operates a website, provided that the website does not specifically

indicate that the Financial Institution provides Financial Accounts or services to nonresidents, and does not

otherwise target or solicit U.S. customers or Account Holders, or (b) advertises in print media or on a radio or

television station that is distributed or aired primarily within Portugal but is also incidentally distributed or aired in

other countries, provided that the advertisement does not specifically indicate that the Financial Institution

provides Financial Accounts or services to nonresidents, and does not otherwise target or solicit U.S. customers

or Account Holders;

4. The Financial Institution must be required under the laws of Portugal to identify resident Account Holders

for purposes of either information reporting or withholding of tax with respect to Financial Accounts held by

residents or for purposes of satisfying Portugal’s AML due diligence requirements;

5. At least 98 percent of the Financial Accounts by value maintained by the Financial Institution must be held

by residents (including residents that are Entities) of Portugal or a Member State of the European Union;

6. Beginning on or before July 1, 2014, the Financial Institution must have policies and procedures, consistent

with those set forth in Annex I, to prevent the Financial Institution from providing a Financial Account to any

Nonparticipating Financial Institution and to monitor whether the Financial Institution opens or maintains a

Financial Account for any Specified U.S. Person who is not a resident of Portugal (including a U.S. Person that

was a resident of Portugal when the Financial Account was opened but subsequently ceases to be a resident of

Portugal) or any Passive NFFE with Controlling Persons who are U.S. residents or U.S. citizens who are not

residents of Portugal;

7. Such policies and procedures must provide that if any Financial Account held by a Specified U.S. Person

who is not a resident of Portugal or by a Passive NFFE with Controlling Persons who are U.S. residents or U.S.

citizens who are not residents of Portugal is identified, the Financial Institution must report such Financial Account

as would be required if the Financial Institution were a Reporting Portuguese Financial Institution (including by

following the applicable registration requirements on the IRS FATCA registration website) or close such Financial

Account;

8. With respect to a Preexisting Account held by an individual who is not a resident of Portugal or by an Entity,

the Financial Institution must review those Preexisting Accounts in accordance with the procedures set forth in

Annex I applicable to Preexisting Accounts to identify any U.S. Reportable Account or Financial Account held by

a Nonparticipating Financial Institution, and must report such Financial Account as would be required if the

Financial Institution were a Reporting Portuguese Financial Institution (including by following the applicable

registration requirements on the IRS FATCA registration website) or close such Financial Account;

9. Each Related Entity of the Financial Institution that is a Financial Institution must be incorporated or

organized in Portugal and, with the exception of any Related Entity that is a retirement fund described in

paragraphs A through D of section II of this Annex II, satisfy the requirements set forth in this paragraph A; and

10. The Financial Institution must not have policies or practices that discriminate against opening or

maintaining Financial Accounts for individuals who are Specified U.S. Persons and residents of Portugal.

B. Local Bank. A Financial Institution satisfying the following requirements:

1. The Financial Institution operates solely as (and is licensed and regulated under the laws of Portugal as)

(a) a bank or (b) a credit union or similar cooperative credit organization that is operated without profit;

2. The Financial Institution’s business consists primarily of receiving deposits from and making loans to, with

respect to a bank, unrelated retail customers and, with respect to a credit union or similar cooperative credit

organization, members, provided that no member has a greater than five percent interest in such credit union or

cooperative credit organization;

3. The Financial Institution satisfies the requirements set forth in subparagraphs A(2) and A(3) of this section,

provided that, in addition to the limitations on the website described in subparagraph A(3) of this section, the

website does not permit the opening of a Financial Account;

4. The Financial Institution does not have more than $175 million in assets on its balance sheet, and the

Financial Institution and any Related Entities, taken together, do not have more than $500 million in total assets

on their consolidated or combined balance sheets; and