Switzerland ratifies Automatic Exchange of Information with India
The Swiss Federal Council, the country's top governing body, says implementation is planned for 2018 and first set of data should be exchanged in 2019.
Switzerland on June 16 ratified the automatic exchange of financial account information with India and 40 other jurisdictions to facilitate immediate sharing of details of suspected black money, even as it sought strict adherence to confidentiality and data security.
Adopting the dispatch on the introduction of AEOI (Automatic Exchange of Information), the Swiss Federal Council said the implementation was planned for 2018 and the first set of data should be exchanged in 2019. The Council is the top governing body of the European nation.
The Indian government would soon be notified on the exact date from which the automatic exchange would begin.
As per the draft notification approved by the Council at a meeting on June 16, the decision is not subject to any referendum. This means there should be no further procedural delay in its implementation.
The issue of black money has been a matter of great debate in India, and Switzerland has been long perceived as one of the safest havens for the illicit wealth allegedly stashed away by Indians.
The decision follows hectic parleys between India and Switzerland for the introduction of the AEOI on tax matters under the guidance of G20, OECD and other global organisations.
The Council said the proposal to introduce AEOI with India and others "met with widespread approval from the interested parties who voiced their opinions in the consultations".
"In concrete terms, the AEOI will be activated with each individual state or territory by means of a specific federal decree within the framework of this dispatch," it noted.
The exchange of information itself will be carried out based on the Multilateral Competent Authority Agreement (MCAA) on the Automatic Exchange of Financial Account Information, which is in turn based on the international standard for the exchange of information developed by the Organisation for Economic Cooperation and Development (OECD).
The Council said it would prepare a situation report before the first exchange of data, which was planned for autumn 2019.
"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. It is important for the Federal Council that a level playing field be created among states and that all major financial centres, in particular, be included. This year, Switzerland has introduced the AEOI with 38 states and territories, including all EU member states, and data will start to be exchanged with them in 2018," it said.