Switzerland on Friday ratified an automatic exchange of financial account information with India in order to facilitate immediate sharing of details about suspected black money, news agency PTI reported. Switzerland, who signed the agreement with 40 other jurisdictions, has however sought strict adherence to confidentiality and data security.
The Swiss Federal Council said that the implementation of the information exchange is planned for 2018 and that the first set of data exchange would happen in 2019. In this regard, the Council has reportedly adopted the dispatch on the introduction of the AEOI (Automatic Exchange of Information), a global convention for automatic information exchange on tax matters.
The Swiss Federal Council said it would soon notify the Indian government regarding the exact date from which the “automatic exchange” would begin. It added that it will prepare a situation report before the first exchange of data takes place somewhere around autumn 2019.
During a meeting on Friday, the council approved the draft notification adding that the decision was not subject to any referendum – meaning the implementation would not face any further bureaucratic delay.
For a long time, Switzerland has been considered a “safe haven” for black money stashed abroad by Indians. The decision by the Swiss Federal Council on the data exchange was reached after several rounds of negotiations between India and Switzerland. The decision was reportedly taken under the guidance of G20, OECD and other global organisations.
According to the council, the proposal to introduce AEOI was 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,” the council said.
The exchange of information will reportedly be carried out in accordance with the Multilateral Competent Authority Agreement (MCAA) on the Automatic Exchange of Financial Account Information.
“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 added.