Brussels, 05/03/2004 (Agence Europe) - Next week's Ecofin Council will again be discussing progress in savings tax negotiations with Switzerland and the associated territories. It is expected to decide in June to confirm, in the light of these negotiations, that the savings tax directive will come into force on 1 January 2005. In order to announce the decision in June, the Council is likely to invite the European Parliament to consider the agreement with Switzerland before 1 April 2004.
Ministers are expected to repeat the firm message to Switzerland of 10 February 2004, wanting it to abandon attempts to connect the savings tax negotiations with negotiations over Schengen and fraud (see EUROPE of 11 February, p. 10). For the moment, Berne is sticking to its guns. The Swiss President, Joseph Deiss, repeated this during his visit to the Irish Presidency, in Dublin in February. Before formally signing the tax agreement reached in March 2003, Switzerland wants to ensure that the legal cooperation established during the Schengen negotiations will not jeopardise the confidentiality of its banks. It is therefore demanding that all the negotiations currently underway, the Bilateral II negotiations, must be concluded simultaneously. The President of the Association of Swiss Banks, Pierre Mirabaud, says that the current urgency augurs well for the success of the negotiations, according to reports published by the Swiss press agency ATS. Mirabaud is reported to have commented that the parallelism of the negotiations should be encouraged but was not an end in itself.
Luxembourg's treasury minister, Luc Frieden, does not share his optimism. At a seminar in Luxembourg on Friday he said he doubted that the directive could come into operation on 1 January 2005, fearing that the negotiations with third countries would not be concluded by June 2004. He hoped that the third countries and associated territories could commit either to the supply of information (required by most Member States) or to withdrawal at source (as wished by Luxembourg, Belgium and Austria) and this could be rapidly turned into an agreement in writing.
The Irish Presidency is expected to inform the Council that the negotiations with United Kingdom associated territories (the Channel Islands) and Dutch associated territories were making good progress, but the same could not yet be said about negotiations with the 'little' third countries. Diplomatic sources suggest that the problems encountered with Andorra and Liechtenstein have been ironed out (and were 'disappearing' with Andorra), but the talks with San Marino were still in stalemate.