Classifieds powered by Gulf News

Swiss government backs banking lobby push for security safeguard in data exchange

Switzerland is due in 2018 to start swapping information with 38 foreign tax authorities

Gulf News


The Swiss government appears to have heeded a recommendation from the country’s banking lobby for assurances that dozens of countries receiving bank data from Switzerland will use the information properly.

The country’s multitrillion-dollar financial industry has lobbied for certain data exchanges to be suspended if there is evidence that countries could misuse bank data which could then expose clients to crimes such as blackmail.

Switzerland is already due in 2018 to start swapping information with 38 foreign tax authorities, including all European Union nations, under the Automatic Exchange of Information programme fostered by the Organisation for Economic Cooperation and Development (OECD).

The government has now approved the mechanism for exchanging data with an extra 41 states and territories in the second half of 2019, among which are several emerging markets such as Brazil, Mexico and Russia.

But before the exchange takes place, the government will now prepare a “situation report”, it said in a statement on Friday.

“In the process, it will be checked whether the states and territories concerned effectively meet the requirements under the standard, especially those concerning confidentiality and data security,” the government said.

If Switzerland finds requirements are not met with specific countries, it could suspend the exchange of data with these jurisdictions.

No reports are planned for the 2018 batch of countries.

Parliament will vote on the government’s recommendation.

“We take positively note of the Federal Council’s dispatch on the automatic exchange of information published today,” the Swiss Bankers Association, the main banking lobby, said in a statement, referring to the government.

Wealthy clients have pulled tens of billions of dollars out of Swiss bank accounts because of a worldwide crackdown on tax evasion following the global financial crisis last decade.

That culminated in the Automatic Exchange of Information programme, which aims to ensure that offshore accounts are known to authorities.

The participation of Switzerland, the world’s largest centre for overseas wealth, in the data exchange agreement was heralded at the time as a major breakthrough in tackling tax avoidance.