On 16 March 2015 the Global Forum on Transparency and Exchange of Information for Tax Purposes published a supplementary report to its Phase I Peer Review of Switzerland. The supplementary peer review report had been requested by Switzerland on the basis of progress made on its framework for transparency and exchange of information since the Phase I report was issued in 2011.

The Global Forum monitors the implementation of the international standards on tax transparency. The provisions for exchanging tax information are contained in the OECD Model Agreement on Exchange of Information on Tax Matters of 2002 and commentary, as well as in Article 26 (exchange of information) of the OECD Model Tax Convention and the equivalent provision of the UN Model.

Phase 1 of the global forum peer review of Switzerland adopted in 2011 examined the legal and regulatory framework for transparency and exchange of information in Switzerland. The global standard looks at the availability of relevant information within a jurisdiction, the ability of the competent authority to gain timely access to the information, and whether that information can be effectively exchanged with the partner countries under information exchange agreements.

Certain essential elements were found by the 2011 Phase 1 examination not to be in place. The report recommended that Switzerland ensures that it has access to bank information in respect of all exchange of information requests under its agreements regardless of their form. The report also recommended that Switzerland ensure its competent authority has the power to obtain all information pursuant to requests under all exchange of information agreements.

In June 2014 Switzerland requested a supplementary peer review report on the basis of its progress with introducing an exception to its prior notification procedure as well as improvements to its network of exchange of information agreements. The supplementary report assessed the changes made.

The supplementary report notes that Switzerland has strong rights and safeguards for taxpayers and others concerned with a request for exchange of information. The new law on administrative assistance now includes an exception to the prior notification of the taxpayer or others and to the right to inspect the file. These exceptions are in line with the standard on exchange of information.

Since the 2011 report Switzerland has updated its network of agreements on exchange of information by signing new agreements and protocols to existing agreements to include the wording taken from paragraphs 4 and 5 of Article 26 of the OECD Model Tax Convention. Switzerland has mechanisms on exchange of information with 127 jurisdictions of which 92 meet the global standard. Of these, 42 are in force currently.

The supplementary report concludes that the actions taken by Switzerland in response to the recommendations of the 2011 report mean that it is now in a position to move forward to Phase II of the Peer Review. Phase II of the Peer Review is scheduled for the second half of 2015 and at that time Switzerland’s response to the recommendations of the supplementary report will be considered in detail.