Black money: Switzerland ratifies automatic exchange of information with India
Switzerland has ratified the automatic exchange of financial account information with India and 40 other jurisdictions to facilitate immediate sharing of details of suspected black money.
Switzerland on 16 June 2017 ratified the automatic exchange of financial account information with India and 40 other jurisdictions to facilitate immediate sharing of details of suspected black money. The country has, however, sought strict adherence to confidentiality and data security.
Speaking on the development, the Swiss Federal Council said that the implementation has been 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 of the exact date from which the automatic exchange would begin.
• As per the draft notification approved by the Council, the decision is not subject to any referendum, which means there should be no further procedural delay in its implementation.
• The decision follows hectic discussions between India and Switzerland for the introduction of the Automatic Exchange of Information (AEOI) on tax matters under the guidance of G20, OECD and other global organisations.
• 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.
• The Automatic Exchange of Financial Account Information is in turn based on the international standard for the exchange of information developed by the Organisation for Economic Cooperation and Development (OECD).
• The Swiss Federal Council would be preparing a situation report before the first exchange of data, which is planned for autumn 2019.
Speaking further on its implementation, the council stated that the AEOI will be activated with each individual state or territory by means of a specific federal decree within the framework of the dispatch. 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.
This year, Switzerland introduced the AEOI with 38 states and territories including all EU member states and the exchange of data will commence in 2018.
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 illegal wealth allegedly stashed away by Indians.