All domestic (U.S.) vendors are required to provide a Form W-9 in order to do business with Freeport-McMoRan. The W-9 is required regardless of whether or not the payment to the vendor is considered reportable on a Form 1099.

The W-9 states the vendor’s Federal Tax Classification Type (S-Corporation, C-Corp, Partnership, LLC, etc.), address, taxpayer ID number and the correct name that corresponds to the taxpayer identification number. Form W-9 must be signed in accordance with the instructions on the form.

The W-9 form and instructions can be found at www.irs.gov.

The U.S. Internal Revenue Code and Treasury regulations require a mandatory 30% income tax withholding on payments made to foreign vendors who provide services in the U.S. unless the income from providing such service is exempt or subject to a reduced withholding rate under a provision of a tax treaty between the foreign vendor's home country and the U.S.

In order to claim any applicable treaty benefit, foreign vendors that are business entities must have a U.S. employer identification number (EIN) and must submit the proper W-8 form for their situation to Freeport-McMoRan prior to receiving payment for such services.

Foreign vendors that are individuals who wish to claim a treaty benefit reducing or eliminating withholding taxes must be eligible to claim a tax treaty exemption by having a social security number (SSN) or individual taxpayer identification number (ITIN) and must submit a completed IRS Form 8233 to Freeport-McMoRan prior to providing such service.

If a foreign vendor performs services in the U.S. and does not provide the proper support for an exemption, Freeport-McMoRan will withhold the appropriate taxes and report such taxes annually on IRS Form 1042-S (Foreign Person's U.S. Source Income Subject to Withholding). Reporting is required regardless of whether or not withholding is required. A copy of the Form 1042-S is sent to the foreign vendor at the time it is filed with the IRS.

Please see the following IRS sites and publications for additional information on withholding on payments to foreign entities:

• IRS Publication 515 - Withholding of Tax on Nonresident Aliens and Foreign Entities
• U.S. Withholding Agent Frequently Asked Questions
• General Information for the International Taxpayer

In accordance with the Internal Revenue Code and Treasury Regulations, vendors who are foreign nationals or foreign entities will need to complete one of the versions of IRS Form W-8 series or an IRS Form 8233 in order for Freeport-McMoRan to make payment for goods or services rendered. The documentary requirements vary depending on the nature and location of the goods and services.

NOTE REGARDING INVOICE REQUIREMENTS: All service invoices must state the location where the services were performed. To assist with prompt payment of invoices, banking instructions must be clearly stated on each invoice.

1) Payment for Services Provided in the U.S.

All foreign vendors receiving payments for services performed in the U.S. are required to supply the proper IRS Form W-8 for their situation, or an IRS Form 8233. If the U.S. does not have a tax treaty with the foreign vendor's country of residence that exempts or reduces the rate of U.S. federal income tax withholding on such payments, or if Form W-8 or 8233 does not contain a U.S. taxpayer ID and has therefore not been correctly completed before payment is processed, 30% of the total payment to the foreign vendor will be automatically withheld by Freeport-McMoRan and remitted to the IRS on the vendor’s behalf.

A list of existing tax treaties between the U.S. and other countries is found in IRS Publication 901, U.S. Tax Treaties, available online at www.irs.gov

If the contract is for purchase of tangible personal property, and if embedded services are included in the purchase of this property, those services must be stated separately and are subject to the requirements of this section (i.e. treaty benefits must be claimed and the W-8 or 8233 must contain a valid U.S. taxpayer ID). An example of an embedded service might include the purchase of equipment for use in the U.S. where the vendor's engineers assist with installation at our U.S. plants.

In order to be valid for tax treaty exemption, both the Form W-8 and Form 8233 (for individuals) require a U.S. taxpayer identification number. Instructions for obtaining a U.S. taxpayer ID are set forth herein.

2) Payment for Services Provided Outside of the U.S. or Payment for Purchase of Tangible Personal Property

For foreign vendors providing either services outside the U.S. or providing tangible personal property (goods) to Freeport-McMoRan, the W-8 BEN must still be completed, however, no treaty benefits need to be claimed and there is no need for a U.S. taxpayer ID.

Freeport-McMoRan requests that every foreign vendor fill out the W-8 to confirm two things: i) that they are a foreign vendor not subject to U.S. tax reporting and/or backup withholding, and ii) that Freeport-McMoRan conducted the necessary step of confirming the foreign status of the vendor. For this purpose, the foreign vendor need only complete Part 1, lines 1-4, and sign and date the bottom of the form. The form must be filled out and signed by an employee/officer/director of the company who is authorized to sign. It ensures that we verified that the company is truly a foreign entity and not subject to withholding. This form is kept in our internal files and provides us with a record that we did meet the requirements of the law by verifying the foreign status of the company.

All foreign vendors receiving payment(s) from Freeport-McMoRan must have an IRS Form W-8 or IRS Form 8233 on file with our company.

Links to IRS Tax Forms

1. Form W-8BEN E Certificate of Status of Beneficial Owner for United States Tax Withholding (Entities) is used exclusively by entities. The Form W-8BEN-E reflects changes made by the Foreign Account Tax Compliance Act (FATCA) and is for use by beneficial owners that are entities. Instructions: http://www.irs.gov/pub/irs-pdf/fw8bene.pdf

2. Form W-8BEN Unlike the previous W-8BEN, the W8BEN is used exclusively by individuals. Instructions: https://www.irs.gov/forms-pubs/about-form-w8

3. Form W-8ECI (Certificate of Foreign Person’s Claim That Income Is Effectively Connected With the Conduct of a Trade or Business in the United States). This form requires the payee to have a valid U.S. taxpayer ID. The form stipulates that the foreign entity files yearly U.S. tax returns to report all income claimed to be effectively connected with a U.S. trade or business. Instructions: http://www.irs.gov/pub/irs-pdf/iw8eci.pdf

4. Form W-8EXP (Certificate of Foreign Government or Other Foreign Organization for U.S. Tax Withholding). This form is used by foreign tax-exempt organizations to claim and document their tax-exempt status under U.S. tax law. To claim exemption from U.S. tax withholding, foreign tax-exempt organizations must provide documentation of their U.S. tax-exempt status. Instructions: http://www.irs.gov/pub/irs-pdf/iw8exp.pdf

5. Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for U.S. Tax Withholding). This form is used for reporting payments to "flow-through entities" such as foreign partnerships or trusts. Instructions: http://www.irs.gov/pub/irs-pdf/iw8imy.pdf

Business entities can obtain an Employer Identification Number (EIN) by completing Form SS-4 (Application for Employer Identification Number). The IRS has established a special phone number (215.516.6999) for foreign applicants who wish to expedite the process.

Individuals can obtain either a social security number (SSN) or individual taxpayer identification number (ITIN), depending on the individual's circumstances. Generally, individuals must visit a local office of the Social Security Administration to obtain an SSN. ITINs can be obtained by filing a completed Form W-7 with the IRS.

For IRS guidelines for Taxpayer Identification Numbers: http://www.irs.gov/Individuals/International-Taxpayers/Taxpayer-Identification-Numbers-TIN (See Section “Foreign Persons and IRS Employer Identification Numbers”)