FROM THE EUROPEAN BANKING FEDERATION
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BANKS SUPPORT FIGHT AGAINST FINANCIAL FRAUD & CRIME
BRUSSELS, 27 March 2019 – The European Banking Federation takes note of the detailed and comprehensive European Parliament’s Report on financial crimes, tax evasion and tax avoidance. On this occasion, the EBF would like to reiterate its full support to the fight against tax fraud and financial crime.
Transparency of taxpayers and investors is a pivotal theme in the Report. Banks play a key role in this field; by reporting information on accountholders to tax authorities and by providing Financial Intelligence Units with suspicious transaction reports, as required by applicable regulations.
The EBF would like to emphasize the significant investments made by the banking sector to comply with the relevant international standards in the area of tax reporting and anti-money laundering. However, the EBF agrees that the efficiency and the administrability of the current EU framework could be improved and should be better aligned on international standards. The recent money laundering cases are a sad demonstration of this situation.
In the area of anti-money laundering the EBF strongly supports better cooperation between authorities and financial institutions, both domestically and cross-border.
The EBF strongly supports alignment with international standards. Accordingly, the EBF notes and welcomes the acknowledgement in the Report that the indicators referred to in the 5th revision of the Directive on Administrative Cooperation (DAC6) should be clarified in accordance with international standards. Earlier this month, the EBF and AFME published joint recommendations which could help improve the implementation of DAC6 by financial institutions. Another very useful tool to enhance the efficiency and administrability of international tax procedures applicable to investment income could consist in the implementation of a withholding tax relief at source system inspired by the OECD implementation package of “TRACE”.
Media contact:
Raymond Frenken, Head of Communications, +32 2 508 3748, r.frenken@ebf.eu
About the EBF:
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from 45 countries. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu Twitter: @EBFeu.
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Brussels, 13 November2019
Joint Business Position on the Modernization of the OECD Arrangement
Since its introduction in 1978, the OECD Arrangement on Officially Supported Export Credits has served as a key tool in creation of a level playing field in international markets by successfully ensuring that competition amongst exporters is based on the quality and price of goods and services rather than on the favorability of public financial support.
However, as the Arrangement passes its 40th birthday, it increasingly faces important limitations in light of key changes to the global trade and investment landscape. Such changes relate especially to the emergence of new significant players unbound by Arrangement rules, as well as the increasing importance of global value chains.
The changing environment has placed increasing pressure on the Arrangement and in some cases undermined its ability to fulfil its purpose, as evidenced by Participants seeking avenues to circumvent it by developing products outside the Arrangement. Today, Arrangement-regulated activity amounts to only 36% of the total Medium and Long Term Activities of Export Credit Agencies (ECAs).
A fundamental modernization of the Arrangement is much needed and must not be delayed. Making it fit for purpose while ensuring a global level playing field is essential, and there are several immediate updates of particular consequence for the business community that can be implemented now.
Businesses across the OECD commit themselves to support the OECD in its mandate to finding solutions to social, economic and environmental challenges. Although ECAs have no sustainable development mandate per-se, many of their activities impact sustainable development, especially within developing countries. For example, through exports OECD-businesses provide infrastructure and contribute to the creation of jobs, the provision of technology, knowledge and expertise (technology spillovers).
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Joint Business Position: Export Credits and Covid-19 x
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Publication date: 22 July 2020
EBF joins BIAC (Business at OECD) and ICC (International Chamber of Commerce) in a business position on Covid-19 and Export Credits.
Summary of key policy recommendations
A) General considerations and short-term liquidity support
- Improving access to liquidity
- Evaluating credit impact
- Broadening financial products offering
- Enhancing re-insurance agreements with other ECA’s
- Restructuring the existing loan portfolio
B) Actions specifically related to the OECD Arrangement
- Increasing the current local costs limitation to 50% of the total scope
- Greater flexibility for ECAs in covering the minimum 15% down payment
- Allow market-reflective repayments to better align with the nature of different projects
- Increase the maximum repayment term to 18 years and cease to distinguish between different sectors
- Revise the premiums applied to private borrowers in high-income OECD countries
- Introduce an easy to define, transparent & predictable CIRR to provide a level playing field
- Temporary suspension of country risk category reviews until at least 31 December
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]]>EBF advisor: Roger Kaiser
Publication date: 7 September 2018
In its comments of 7 September 2018 on the OECD BEPS Discussion Draft on the transfer pricing aspects of financial transactions, the EBF emphasises that the banking sector is subject to extensive regulation (incl. capital, liquidity and leverage requirements). In the EBF’s view, the main purpose of the revised guidelines should be about improving the standard of non-banks treatment of financial transactions. Therefore, the Discussion Draft should not replace or conflict with the OECD 2010 Report on the attribution of profits to permanent establishments of banks. The EBF also calls for the guidelines to provide flexibility to Multinational Entreprises (MNEs) as far as the application of the separate entity approach for the risk assumption is concerned.
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]]>EBF advisor: Roger Kaiser
Publication date: 23 July 2018
The EBF commends the Commission on its efforts for having brought together a small number of EU Member States to discuss the long outstanding issue of withholding tax (WHT) relief/refund procedures which resulted in the publication of the Code of Conduct on WHT in December 2017. However, the EBF believes that much more needs to be done. For that matter, the EBF encourages the Commission to work closely with the OECD, notably to help ensure a proper implementation of its Tax Relief and Compliance Enhancement (TRACE) project. Furthermore, the EBF takes the view that engaging with the wider financial services sector and the investment community will bring about more workable procedures.
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]]>EBF advisor: Roger Kaiser
Publication date: 19 March 2018
The EBF has serious concerns about the Commission’s proposals for a Directive on mandatory disclosures in relation to some cross-border arrangements ( “DAC6”) and the OECD model for Mandatory Disclosure Rules for tax reporting avoidance arrangements and offshore structures which DAC6 is expected to incorporate.
A major concern is that the contemplated scheme would be very challenging to implement in practice if financial institutions have to carry out granular investigations, potentially with retroactive effects.
The broad scope of application of DAC6 and the absence of a clear actual knowledge test will result in a great deal of legal uncertainty for financial institutions, which in their vast majority are not designers/promoters of tax schemes for their clients and in some Member States are even legally prevented from providing any tax advice.
The EBF therefore calls on the Council to reconsider the scope of application of the proposed Directive and to clarify that providing routine banking services (e.g. maintaining a financial account for a customer) without any additional involvement in structuring, does not make the bank an “intermediary” under DAC6.
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]]>EBF advisor: Roger Kaiser
Publication date: 15 February 2017
The European Banking Federation (EBF), which is the voice of the European banks, thanks the Commission for the opportunity offered to express views on whether there is a need for EU action aimed at introducing more effective disincentives for intermediaries engaged in operations that facilitate tax evasion and tax avoidance.
As an umbrella organisation representing the whole European banking sector, we have difficulties to answer the questionnaire of the consultation which seems to be directed to individual companies and legal firms.
In this context, we thought it appropriate to remind the Commission of the role of banks as obliged entities for AML purposes as well as their involvement in tax processes, the latter element having increased dramatically over the past years.
The EBF fully supports the objectives of AML and the fight against tax evasion.
We are in favour of the protection of the integrity and stability of the international financial system. Money laundering and terrorist financing are serious threats to global security and to the integrity of the financial system. Resources available to terrorists and those engaged in crime should be cut off. Banks can only live in an environment where the rule of law is fully applied.
The EBF strongly condemns tax evasion and tax fraud. They create distortions in the single market for financial services and pose a great danger to the rule of law.
The EBF experts are actively involved in international expert groups on anti-money laundering and tax transparency, both at the level of the OECD and of the EU. In these fora, we assist governments and institutions by providing expertise and workable solutions, seeking clarity on the legal and compliance requirements imposed on banks, while taking into account operational constraints, the competitive dimension, potential de-risking and the need to ensure an appropriate level of data protection and data security.
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]]>Publication date: 21 April 2016
Dear Commissioner,
Subject: Proposed Anti-Tax Avoidance Directive
I am writing to you as Chief Executive of the European Banking Federation (EBF), which is the voice of European banks.
The EBF is supportive of the development of new standards in the field of taxation and of the adoption of tax measures, including anti-avoidance measures, which are designed to foster fairer tax competition between jurisdictions globally and to simplify the international tax system with a view to preventing double taxation and double non-taxation.
Banks are already undergoing extensive adaptations of their standards, processes and systems to comply with an array of international and domestic regulatory changes, which aim to increase transparency and responsibility. A coordinated and coherent implementation of the OECD’s recommendations regarding base erosion and profit shifting (BEPS) at EU level, which would enhance a single uniform market, is another initiative that the EBF would support. For the reasons explained in the attached paper, the EBF, however, very much doubts that the proposed Anti-Tax Avoidance Directive (ATAD) released by the Commission could achieve this goal in the current stand of the drafting.
To read the full letter, click on “FULL DOCUMENT”
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