This web page is aimed at all natural persons and legal entities concerned by a procedure of administrative assistance based on a double taxation agreement.
Exchange of information on request (EOIR)
A. General
1) What are the origins of EOIR?
2) What are the legal foundations and other sources providing for EOIR?
3) What is the scope of application of EOIR in terms of substance?
4) What is the scope of application of EOIR in terms of time?
5) How is the right to appeal granted under an administrative assistance procedure?
In 2009, the G20 asked the Global Forum to rapidly put in place an international standard on transparency and information exchange. In this context, Switzerland withdrew its reservation regarding Article 26 of the OECD's Model Tax Convention and adopted this standard by Federal Council decision. It then negotiated a number of new double taxation agreements (DTAs) or revised existing ones to include an administrative assistance clause in compliance with the OECD standard.
At international level
When a DTA is concluded between Switzerland and another state, administrative assistance is governed by that agreement, which defines the criteria for the exchange of information. Effectively, the administrative assistance given by Switzerland is mainly governed by DTAs.
Some states which have not concluded bilateral DTAs have signed Tax Information Exchange Agreements (TIEAs). These agreements relate only to an exchange of tax information upon request.
The Convention on Mutual Administrative Assistance in Tax Matters is the most complete multilateral instrument in this area and provides for several forms of possible cooperation with the aim of combating tax evasion and tax fraud.
Finally, so-called soft law is also part of the sources for administrative assistance; in particular, this includes commentaries and other non-binding decisions establishing standards (Art. 26 of the OECD Model Tax Convention).
At national level
The main sources governing the administrative assistance procedure are the Federal Act of 28 September 2012 on International Administrative Assistance in Tax Matters (TAAA; SR 651.1) and its ordinance (TAAO; SR 651.11). In addition, unless the TAAA provides otherwise, the Federal Act on Administrative Procedure (APA; SR 172.021) applies.
Article 1 paragraph 1 of the TAAA governs, in particular, the provision of administrative assistance as regards the exchange of information upon request on the basis of DTAs as well as other international conventions providing for the exchange of information in tax matters.
The articles of international agreements governing administrative assistance in line with international standards specify the tax year in which administrative assistance begins to apply, generally from 1 January of the year following the entry into force of the protocol of amendment for the agreement in question.
The right to appeal guaranteed by Article 29 paragraph 2 of the Federal Constitution must be respected in all administrative assistance procedures before information is transmitted to the foreign authorities. Exceptionally, if the criteria set out in Article 21a of the TAAA are met, the persons concerned are not informed until after the information has been transmitted to the foreign authorities (see also question B5 below).
In addition, the FTA informs persons entitled to appeal (but not formally referred to in the request) of the request for administrative assistance (Art. 14 para. 2 of the TAAA). However, the notification must not be implemented in such a way that the effective exchange of information is prevented or unduly delayed.
B. Specifics
1) How is a specific EOIR procedure triggered?
2) What information is covered by the request?
3) How is the information procured?
4) How are the persons concerned informed?
5) What happens in the procedure with deferred notification of persons concerned/entitled to appeal (Art. 21a of the TAAA)?
6) What are the legal remedies?
7) What happens in the simplified procedure?
8) How is the procedure completed?
9) Can Switzerland also make administrative assistance requests?
The procedure is initiated when the competent foreign authority submits a request to the FTA, which checks whether the material criteria are met.
The foreign authorities may request various kinds of information in order to clarify the tax situation of their taxpayers and to achieve the aim of the request.
This can be, in particular, banking information (e.g. account statements, documentation on the opening of the account), information on Swiss companies (e.g. tax returns, balance sheets and profit and loss accounts, especially when transfer prices are to be checked) and personal information (e.g. tax returns, addresses, in the case of questions relating to residence for tax purposes).
Information is procured by means of production orders issued to the holder of the information (Arts. 9 to 12 of the TAAA: banks, companies, cantonal tax administrations, etc.) which are immediately enforceable. The holder of information has an obligation to transmit the information to the FTA, subject to a fine.
If the person concerned/entitled to appeal is resident in Switzerland, the FTA will inform them directly about the main parts of the request (Art. 14 para. 1 of the TAAA). If the person concerned is resident abroad, the FTA requests the information holder to inform such person (Art. 14 para. 3 of the TAAA). Otherwise, the FTA itself notifies the person resident abroad, provided it is permitted to serve documents in the state concerned by post, or the competent authority expressly consents (Art. 14 para. 4 of the TAAA). Finally, if the person cannot be contacted, the FTA notifies via publication in the Federal Gazette (Art. 14 para. 5 of the TAAA).
Exceptionally, under Article 21a of the TAAA, the FTA may notify the persons concerned/entitled to appeal only after the information has been transmitted to the requesting authority. For this purpose, the requesting authority must credibly demonstrate that prior notification of these persons would effectively compromise the aims of the administrative assistance and the completion of its investigation.
The FTA issues a conclusive decree which contains the information it plans to transmit to the requesting authority (Art. 19 of the TAAA). This decree can be appealed before the Federal Administrative Court (FAC). An appeal against an FAC ruling on public law grounds may still be lodged with the Federal Supreme Court, provided it relates to a question of legal principle or in particularly important cases for other reasons, within the meaning of Article 84 paragraph 2 of the FSCA.
If the persons concerned consent to transmission of the information, they can sign a declaration of consent (Art. 16 of the TAAA). After receipt of the declaration of consent from all the persons concerned/entitled to appeal, the information is transmitted to the competent authority without a conclusive decree being issued: the procedure is thus complete.
If the FTA accedes to the request, it transmits the information once the notification procedure is complete (conclusive decree has entered into force, or consent has been given in the case of the simplified procedure). When transmitting the information to the requesting authority, the FTA reiterates the obligation to observe the principles of speciality and confidentiality.
Conversely, if the FTA does not accede to the request, no information is transmitted to the requesting state. The latter is then informed of the result and of the closure of the procedure.
Switzerland can also request information from foreign authorities (Art. 22 of the TAAA). In this case, the interested tax authorities submit their international administrative assistance request to the SEI (FTA). The SEI examines the request and decides whether the requirements under the administrative assistance provisions in the applicable agreement are met. If so, the SEI (FTA) transmits the request to the competent foreign authority and monitors the administrative assistance procedure until its conclusion. There is no right of appeal against Swiss requests for international administrative assistance.
Contact
Federal Tax Administration
Division for exchange of information in tax matters
Eigerstrasse 65
3003 Berne
Last modification 18.11.2024