FATCA Agreement

The Agreement on the implementation of the U.S. tax law FATCA (Foreign Account Tax Compliance Act) has been accepted by the Swiss Parliament. Banks must comply with the law from mid 2014. With FATCA the U.S. require from foreign banks to report bank accounts of U.S. clients to their tax authorities. If foreign banks do not comply with this agreement, they are effectively excluded from the U.S. capital market. Switzerland has chosen to comply with these requirements by means of a methodology throughout which the information is not directly exchanged between the tax authorities. Based on the methodology applied, the foreign banks provide information about U.S. accounts, based on which the U.S. authorities can request further and detailed information by means of mutual assistance between the authorities.