Switzerland: updates on FATCA
The Swiss parliament approved the FATCA-implementing Act in September 2013, at the same time as it approved the FATCA intergovernmental agreement between Switzerland and the US, which came into force on June 2, 2014, through an exchange of notes.
The FATCA agreement simplifies procedures for Swiss financial institutions in their compliance with the US FATCA, which covers deposits held on behalf of US persons. FATCA implementation in Switzerland will be facilitated by a Model Two Intergovernmental Agreement, which requires Swiss financial institutions to disclose account details directly to the US tax authority with the consent of the US clients concerned. The US will have to request data on any recalcitrant clients through the normal administrative assistance channels.
Meanwhile, the Federal Council is seeking to switch to Model One, which provides for the automatic exchange of information through a centralized authority. To this purpose, it approved the draft mandate for negotiations with the US on May 21, 2014. Worldwide implementation of FATCA will start on July 1, 2014.