The bilateral agreement was signed in Brussels today by State Secretary Jacques de Watteville, Finance Minister Jānis Reirs from Latvia, representing the EU Presidency, and EU Commissioner Pierre Moscovici. The agreement on the automatic exchange of information (AEOI) in tax matters will apply for all 28 EU member states. The OECD's global AEOI standard has been included in full in the new agreement. To date, approximately 100 countries, including all major financial centres, have committed themselves to introducing this global standard. A first group of approximately 50 states intend to implement the standard already in 2016. The agreement between Switzerland and the EU should come into force on 1 January 2017 and the first sets of data should be exchanged from 2018, provided the approval process is completed on time in Switzerland and the EU.

In formal terms, the agreement signed this morning is a protocol of amendment to replace the taxation of savings agreement between Switzerland and the EU that has been in force since 2005, but it includes the existing withholding tax exemption for cross-border payments of dividends, interest and royalties between related entities. This is in the interests of Switzerland as a business location.

The agreement is in line with the negotiation mandate adopted by the Federal Council on 8 October 2014. It is not possible to formally link other tax and financial issues to the introduction of the global standard. Various EU member states have launched regularisation programmes or stepped them up in recent years. Consequently, the regularisation of the past with neighbouring countries and the main EU member states can be considered settled to a large extent.

With regard to improved market access, initial exploratory talks have been held with the EU on the feasibility and possible form of a sectoral financial services agreement. The continuation of these talks will depend on the further development of overall relations with the EU, particularly the issue of the free movement of persons. Concerning the ongoing procedure to have the equivalence of Swiss regulation and oversight (Solvency II, central counterparties) recognised, the European Commission has raised the prospect of a positive outcome before long.

Next steps

Within the framework of the consultation initiated by the Federal Council today, interested parties and the cantons have until 17 September 2015 to comment on the AEOI agreement with the EU. Thereafter, the Federal Council will submit the agreement, together with a dispatch, to Parliament for approval.

Parallel to this, work is continuing on the legal basis for the automatic exchange of information with foreign countries. The Federal Council will adopt the dispatches on the AEOI Act, the Multilateral Competent Authority Agreement and the OECD/Council of Europe administrative assistance convention for the attention of Parliament in the weeks ahead.

Address for enquiries:

Publisher:

The Federal Council Internet: http://www.admin.ch/br/index.html?lang=en

Federal Department of Finance Internet: http://www.efd.admin.ch