Ref. Ares(2014)352804 - 12/02/2014
EUROPEAN COMMISSION
DIRECTORATE-GENERAL
TAXATION AND CUSTOMS UNION
Brussels, 4 February 2014
Taxud.d2(2014) 3784720
REPORT OF MEETING
1. Meeting:
Council – High Level Working Party on Tax Questions
2. Subject:
3. FATCA – Information Point;
4. Savings Directive – The Way
Forward.
3. Date and Place:
4th February 2014, Brussels
4. Participants:
(TAXUD.D2).
5. Detailed report:
Agenda item n. 3 - FATCA
Pres explained that the item was aimed at allowing Member States to share information
on how FATCA negotiations with the US are progressing. Pres has circulated, in advance
of the meeting, a table to be completed by each Member State which indicates the type of
Model agreement chosen, the date of signature/ratification/entry into force of the
agreement and possible remarks. Contributions provided by Member States have been
put together by Pres in Room Document #6, a revised version of which (REV1 – in
Annex) was circulated yesterday.
. Pres invited Member States to share their experience with each other.
.
PL noted that most Member States have already signed or are negotiating a FATCA
Model 1 agreement. PL initialled a FATCA Model 1 agreement with the US last
September but is still waiting to sign it due to the long time that the US State Department
is taking to check the Polish translation of the agreement. PL complained about the US’s
behavior and wanted to know from other Member States whether they experienced the
same problems with having the translations of the agreements checked by the US.
ES informed the other Member States that the US/ES FATCA agreement has recently
entered into force and will be published soon.
DE said that the US/DE FATCA agreement is already in force and that domestic
implementing rules as well as a regulation for financial institutions will be put into place
soon. In response to the question raised by PL, DE said that also the US/DE FATCA
agreement took some time to be checked by the US State Department.
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COM thanked Pres for having put FATCA on the meeting agenda and also thanked
Member States for having provided an update on how they are progressing with FATCA
agreements. COM found it very helpful for Member States to continue to share
information on this topic. COM noted that while several Member States have already
signed an agreement with the US or are close to doing so, for some Member States
negotiations with the US are at a less advanced stage. In this respect, COM recalled that
the US, in Notice 2013-43, clarified that in order for a jurisdiction to be treated as having
a FATCA agreement in effect, it is sufficient that the jurisdiction signs a FATCA
agreement before 1 July 2014. COM restated that it would be very happy to assist
Member States with any issue they may have during the negotiations.
, COM recalled to Member States
that the US legal and infrastructure framework should not only ensure the confidentiality
of the data exchange but also comply with EU rules on data protection.
COM welcomed the clarity on the timetable provided by the
and restated that the
best means of implementing the global standard within the EU is through an EU
instrument, notably the COM proposal to revise the Directive on Administrative
Cooperation. COM said that it was happy with the progress made in the Council’s
discussions on this proposal and that these discussions should continue in parallel with
discussions at OECD level.
IT pointed out that the timeline for implementing the global standard should remain
ambitious and explained that the G5 proposal to push it a little forward was aimed at
having a critical mass of countries on board. IT said that it is very important that this
critical mass of countries includes all EU MS.
Agenda item n. 4 - Savings Directive
Pres opened the item by presenting the contents of Room Doc #5 (in Annex) to the
meeting and inviting views from the floor.
DE noted that as the file had been on-going for years, the time was ripe for adoption. The
EU needed to send a signal to the rest of the world that it meant business.
t
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IT agreed with the need for the EU to send a clear message. This was also an issue of EU
credibility as well as being an important issue of resources for Member States. Action
was required by ECOFIN. Alignment with the DAC was obviously necessary, but this
should follow adoption, after February ECOFIN.
ES agreed with IT and also highlighted the importance of making rapid progress in the
negotiations with the third countries.
FR supported all speakers and said that adoption by the end of March was vital for the
credibility of the European Council.
PL supported all speakers and went a step further saying that if there was no adoption by
the end of March, the EU would be blamed for its lack of action.
LU congratulated the
on the points it had made, notably the need for one coherent
global standard, the importance of international developments at the OECD and
elsewhere, the need to avoid duplication to achieve efficiencies and the need to achieve a
level playing field (a particular concern of LU in recent months).
. The call of the December European Council was for the
Commission to present a progress report to its March meeting. In those circumstances, it
would be wrong for ECOFIN to take any decision before that EC meeting which might
prejudice the view that the EC might wish to take on the COM’s progress report.
Specifically, in the case of LU, the new Prime Minister had subscribed to the December
EC conclusions and it would be wrong for the new Finance Minister to prejudice the PM
by adopting revised Savings at ECOFIN, before the PM had considered the COM
progress report in a EC context, particularly as LU has a coalition government. Member
States may put what they wish on the ECOFIN agenda’s for February or March, but LU
will not adopt the revised Directive at either meeting.
COM thanked the Pres for its hard work on the file and said it would respond to MSs
who had emphasised the need to know the status of the negotiations with the five. It gave
a chronological rundown of events, from the granting of the EU mandate, to the visits to
the five made by the Commissioner, to the holding of preliminary technical meetings and
the consideration thereat and in writing of technical detail, notably relating to beneficial
ownership. Following receipt by the five of formal mandates, first round discussions
have been held and second (& in the case of CH, third) round discussions have been
organised. Automatic exchange has been the COM requirement throughout and it is clear,
even from international developments, that all 5 are moving in this direction. Regarding
CH, it is clear that its Rubik-style agreements are outdated and no longer relevant. CH
has made it known that it sees the outcome as being time dependant, with the quick-fix
option comprising of an agreement based on the Savings amending proposal, but without
automatic exchange, whereas the longer term option could be based on automatic
exchange and a wider scope. The COM sees automatic exchange as the goal and is
pursuing continued equivalence, in accordance with our mandate, having regard to the
emerging global standard. The outlook is very positive. COM will report to the March
EC, but hopes to be able to inform the earlier March ECOFIN of the substance of its
progress.
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COM referred to the calls of MSs to adopt the revised Directive and endorsed those
calls, adding a substantial point. In view of the agreement that alignment was required
between EU measures and the global standard, for clarity and the avoidance of doubt,
COM recommended putting a second matter, in parallel, on the ECOFIN agenda – ie to
ask the ECOFIN Ministers to announce their agreement to adopting the global standard
emerging at OECD level by incorporating it into EU legislation, paying particular
attention to achieving consistency between its provisions and those of the Directive on
the Taxation of Savings and the Directive on Administrative Cooperation, including their
amending proposals. This would give clarity to operators within the EU and would
strengthen the negotiating position of COM, as well as confirming its negotiating
objectives. Accordingly COM called for two outcomes from ECOFIN; adoption and
orientation.
. In closing, LU recalled
that when its delegation met last week with Commissioner Semeta, it annnounced that it
would welcome the Commissioner giving an “information” presentation to March
ECOFIN on progress in the negotiations, which would be helpful to pave the way
towards a favourable outcome at the March European Council and that Commissioner
Semeta seemed satisfied to take this approach. In that event, the LU Finance Minister
would welcome being able to report to his PM that negotiations were progressing
satisfactorily, but it should be noted that adoption at February or March ECOFIN is out
of the question.
Pres said it would carefully consider the positions with a view to coming back to the
topic at tomorrow’s Coreper.
Report by
(TAXUD.D2).
4
Circulation
Cabinet of Mr. Šemeta: Mr Moutarlier
Mr. Zourek,
Mr Kermode
TAXUD.D2 list
ANNEX
Presidency Note to HLWP of 4 February 2014
1.
Momentum to move forward
The European Council in its conclusions of 19/20 December 2013 called for the
adoption of the revised Directive on the taxation of savings income by March 2014.
The Presidency's view is that in the current international economic climate it is
important to arrive at a satisfactory solution for all 28 Member States, enabling
them to safeguard their tax revenues in respect of undeclared savings hidden
abroad. Moreover, as the perils of offshore tax evasion have received increased
public scrutiny, it is imperative that the EU retains its leading role in the combat of
tax fraud and evasion, by adopting a comprehensive legal framework for the
effective taxation of savings within the EU.
The momentum within the EU corresponds to other important developments, which
are confirming the global trend towards automatic exchange of information, such
as:
− The call for more transparency in tax matters, as highlighted in a Joint Statement
made by a large number of jurisdictions. It aims at an early adoption of the
global standard of automatic exchange, to be developed and endorsed in the
OECD context.
− The Global Forum on Transparency and Exchange of Information for Tax
Purposes, continues to play an important role in relation to efforts mentioned
in the above Joint Statement.
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− The US Foreign Account Tax Compliance Act (FATCA) promoting automatic
exchange of information on financial accounts has had concrete consequences
for financial and banking sectors in many countries. As far as the EU is
concerned, negotiations of all 28 Member States with the US administration
are ongoing in relation to FATCA. The starting date for the application of
FATCA provisions is approaching. The first report of information is due in
2015, for information about accounts maintained during 2014.
2.
Submission to Council (ECOFIN)
Against this background, the Presidency intends to submit the revised Savings
Directive to the Council (ECOFIN) in line with the request by the European
Council of December 2013 to adopt it by March 2014.
3.
Preparation by the HLWP
In preparation of the submission of the file to ECOFIN, Member States are invited
to express their views on the way forward at the HLWP on 4 February 2014.
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Document Outline