EU hits out at US for ‘lack of reciprocity’ under Fatca

As Accidental Americans try to stop the Netherlands from sharing data with the United States

The European parliament (EP) has criticised the US for not sharing information regarding tax compliance with the bloc.

 

It said that it “deplores the lack of reciprocity under the Foreign Account Tax Compliance Act (Fatca)”, while the US has been receiving data regarding US citizens and their financial institutions from EU member states.

The EP added that the US is becoming a “significant enabler of financial secrecy for non-US citizens” and noted that the American system currently has two “loopholes”; only information on US assets is shared, and no beneficial ownership data is sent across the Atlantic.

As a result, it is urging the European Commission and all member states to “enter into new negotiations with the United States in the OECD framework in order to achieve full reciprocity with a commonly agreed and strengthened Common Reporting Standard (CRS) framework”.

If successful, this should result in lower compliance costs for financial institutions and would “significantly reduce bureaucratic burdens”, the parliament added.

The EP has also criticised the way Fatca is impacting so-called ‘accidental’ Americans and the fact that, to date, no Europe-wide solution has been found to mitigate this.

Stopping transfers

Elsewhere, the Association of Accidental Americans (AAA) has filed a request for enforcement with the Dutch Data Protection Authority demanding an “immediate halt” to the automatic transfer of European citizens’ personal data to the US.

The move stems from the association’s argument that automatic transfers violate European and national legislation on the protection of personal data and privacy; especially after the European Data Protection Board asked member states in April 2021 to review their international agreements to make sure they were compliant with the General Data Protection Regulation (GDPR).

The Netherlands’ Autoriteit Persoonsgegevens said: “The review of the bilateral intergovernmental agreement concluded on 8 December 2013 between the USA and the Dutch government concerning Fatca and its possible renegotiation with the USA is hence the primary responsibility of the responsible ministries within the Dutch government.

“Since this is an ongoing process, the Dutch Data Protection Authority awaits the outcomes of the efforts of the Dutch government before deciding on any further actions.”

AAA president Fabien Lehagre added: “It’s therefore the duty of the personal data protection authority of the Netherlands to suspend the transfer at least until the Fatca agreement is revised.

“It would be a big mistake to let the Dutch government make an illegal transfer.”

 

https://international-adviser.com/eu-hits-out-at-us-for-lack-of-reciprocity-under-fatca/

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