Switzerland Now Has Trusted Bank Data Exchange with Over 100 Countries

Switzerland exchanges confidential bank client data with more than 100 countries. Three more countries have joined the list.

This year, Switzerland has exchanged information on client data and financial figures with 104 countries, according to data from the Federal Tax Administration (FTA). This practice is based on the automatic exchange of information (AEOI), which Switzerland committed to at the beginning of 2017. However, no public information on the total assets involved is available.

With the help of the AEOI, the cantonal tax authorities can check whether taxpayers declare their financial accounts abroad correctly.

SVP Criticism

The list of more than 100 countries with which Switzerland maintains AEOI now includes Kazakhstan, the Maldives, and Oman. Their inclusion is due to a request from Parliament in 2019 when a list of 19 countries was compiled.

At the time, the conservative SVP party opposed the AEOI because it thought these countries were not comparable to Switzerland regarding the rule of law, SVP National Councilor Thomas Matter argued. He said the data watchdog found none of those countries had data protection comparable to Switzerland's. «Under no circumstances should we authorize the Federal Council to introduce AEOI with these states,» Matter said.

Some 9,000 Financial Institutions Reported

Matter only partially succeeded with his request, failing in the cases of Kazakhstan, the Maldives, and Oman. Switzerland exchanged information with 78 countries this year while obtaining information from another 25 other countries without providing any in return. Sometimes, the countries didn't meet confidentiality and data security requirements or voluntarily refrained from receiving information.

According to the FTA, around 9,000 reporting financial institutions are registered with it, with banks, trusts, and insurance companies collecting data and sending it to Bern. Switzerland has submitted information on some 3.6 million financial accounts abroad and received information on 2.9 million accounts from partner countries.

Russia on the Radar

Russia is conspicuously absent. As a result of its invasion of Ukraine in February last year, the exchange was suspended in September of the same year. The implementation of the AEOI is being reviewed by the OECD's Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum).