Federal Council approves dispatches on legal basis for automatic exchange of information

The first proposal concerns the OECD/Council of Europe Convention on Mutual Administrative Assistance in Tax Matters. Signed by Switzerland on 15 October 2013, this convention governs international administrative assistance in tax matters. It makes provision for three forms of information exchange: upon request, spontaneous and automatic. The Federal Council is insisting on the reservations it included in the consultation draft concerning the timing and material scope of application of the convention. Regarding the legal basis required for implementing the convention in Switzerland, the Federal Council is requesting selective amendments to the Tax Administrative Assistance Act.

The second proposal submitted to Parliament concerns the Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information (MCAA), which was signed by Switzerland on 19 November 2014. A corresponding federal act is required to ensure that the provisions of this agreement and of the global standard for the automatic exchange of information can be applied. The new Federal Act on the International Automatic Exchange of Information in Tax Matters (AEOI Act) contains provisions on the organisation, the procedure, the judicial channels and the applicable criminal provisions.

The standard for the automatic exchange of information can be implemented in two ways: either through a bilateral agreement, such as the one signed between Switzerland and the European Union on 27 May 2015, or by means of the Multilateral Competent Authority Agreement, which is based on the multilateral OECD/Council of Europe Convention. The latter was the means chosen for introducing the automatic exchange of information in tax matters between Switzerland and Australia. The draft is currently under consultation.

The consultation for the two proposals ran from 14 January to 21 April 2015. Parliament will begin deliberations on the proposals in autumn 2015. Even if a referendum is held, the legal basis could come into force at the start of 2017, and the exchange of information with partner states could commence in 2018, in line with what Switzerland indicated to the Global Forum in October 2014. About 100 countries in attendance at that conference committed to introducing the automatic exchange of information, some 50 of which will do so in 2016/17 and the remaining countries (including Switzerland) in 2017/18. By implementing the new standard for the automatic exchange of information, Switzerland is making a considerable contribution to combating tax evasion.

Parliament will have to decide not only on the legal basis but also, at a later date, on the agreements signed by Switzerland. In addition to the agreements with Australia and the EU, other agreements are currently being negotiated.