Liberty and justice for all United States persons abroad

The Isaac Brock Society

FATCA and the EU

April 2019

03: Disappointing May 2, 2019 Response From Pierre Moscovici, Member of European Commission, to FATCA Complaints of Sophie in’t Veld

July 2018

06: EU Lawmakers Vote to Kick-Start FATCA Talks With United States
05: Independence Day attempt in European Parliament–the Empire lives well

July 2017

11: Refreshing: @SophieintVeld calls EU answer to plight of #AccidentalAmericans “bullshit”

September 2016

30: #FATCA Came Last to EU, but Mandatory Fingerprinting was First

August 2015

31: Parliamentary Question: Legality of intergovernmental agreements (IGAs) on FATCA

January 2015

10: EU Residents/Citizens: This is For You

September 2014

13: US seeks additional Customs Pre-Clearance locations in the EU

August 2013

24: European Parliament opposes exchanging bank data with the US

June 2013

01: The Bigger Perspective on EU #FATCA Public Hearing, Policy Laundering, Reciprocity and the Consequences

May 2013

31: Public Hearing on FATCA at the European Parliament in Brussels

23: EU Parliament Hearing on FATCA May 28th

April 2013

04: MEP Sophia In’t Veld discusses FATCA in EU Parliament

March 2013

25: Question and Answer on FATCA in the European Parliament

February 2013

26: EU Tax Chief Urges U.S. Support for Transactions Levy @BloombergNews

April 2012

19: US bullies the EU into sharing passenger data

March 2012

10: Two prominent members of European Parliament raise concern over FATCA five agreement

February 2012

20: EU Parliament and FATCA

16: Are China, Russia, the EU and Switzerland poised to give in to FATCA?

January 2012

23: EU Charter of Fundamental Rights

546 thoughts on “FATCA and the EU”

  1. “This can easily be overlooked and enforced under the guise of tax enforcement. ”

    Overlooked by whom? Enforced by whom?

    FBAR transmissions are coerced insecure transfers of personal data to a US crime enforcement agency – coerced in part by the Member States. It would be interesting to learn the Commission’s opinion about this in the context of GDPR.

    I’m not suggesting that a question along those lines would lead to action over FATCA/IGA. I’m not sure it’s possible for the Commission to do anything about the IGAs without either the consent of the Council or a ruling from the ECJ. But it would be interesting to see what the Commission would say about the FBAR connection.

    “judicial recourse would be our only hope.”

    I think that’s likely.

    “the resolution puts clarity to the problems associated with CBT and FATCA.”

    Indeed. The study is fantastic and the resolution (if adopted) will be even more so.

    I would like to know about amendments 1 – 8, though.

  2. @plaxy

    “Overlooked by whom? Enforced by whom?”

    Your guess will be better than mine. Let us invent a competent authority for this.

    “But it would be interesting to see what the Commission would say about the FBAR connection.”

    Yes, it would be very interesting to see. Although FBAR is separate to taxation, many (including myself) still perceive it as part of the US fiscal regime… CBT/FATCA/IGA/FBAR/TIGTA. It is all one awful alphabet soup…

  3. Hello all

    The full PETI vote on the Resolution concerning the “adverse effects of FATCA on EU citizens and in particular accidental Americans” can be found here:

    http://www.europarl.europa.eu/pdf/divers/wps2018/PETI_2018-06-19_10h30m00s_BXL_ASP_1G3_Channel%20001.mp3

    The relevant bit is from 2:55 through to 7:44.

    Question for oral answer to the Commission – Adopted

    Question for oral answer to the Council – Adopted

    Amendments to Resolution
    —————————————–
    Amendment 1 – Adopted
    Amendment 2 – Adopted
    Amendment 3 – Adopted
    Amendment 4 – Adopted
    Amendment 5a – Adopted
    Amendment 5b – Adopted
    Amendment 6 – Adopted
    Amendment 7 – Adopted
    Amendment 8 – Withdrawn
    Amendment 9 – Rejected (electronic vote)
    Amendment 10 – Adopted
    Amendment 11 – Adopted
    Amendment 12 – Adopted
    Amendment 13 – Adopted
    Amendment 14 – Adopted
    Amendment 15a – Adopted
    Amendment 15b – Rejected
    Amendment 16 – Adopted
    Amendment 17 – Adopted
    Amendment 18 – Adopted
    Amendment 19 – Adopted
    Amendment 20 – Adopted (electronic vote)

  4. Thanks, Duality.

    Interesting to see that they’ve withdrawn Amendment 8 (about US platforms (AirBnB, Amazon, TripAdvisor etc) asking non-US-resident payees about US citizenship.)

    Looking forward to the 4th of July, for once. 😉

  5. I haven’t read the report below, but am posting it in case it has implications/interest for those in the EU re the EU born children of US parents or Accidental Americans who are also EU residents;
    an interesting issue raised re “the agent of citizenship” – this context is Latvia and Estonia, but am posting because of our discussions at IBS re the conferral of unwanted and unasked for citizenship/tax citizenship status on the children of qualifying US parents (children born outside the US whose parents can confer US status) and the US imposition of taxes on those who cannot renounce (minors and those deemed legally incompetent).
    “..This in-depth analysis, commissioned by the European Parliament’s Policy Department for Citizens’ Rights and Constitutional Affairs at the request of the PETI Committee, argues that Latvia and Estonia have introduced legal statuses –non-citizenship in Latvian and undetermined citizenship in Estonia – that are unique in the European Union in that they give their holders a status that is not citizenship but that is not statelessness either suggesting that the statuses give far-reaching rights to their holders while staying short of citizenship. …..”
    http://www.europarl.europa.eu/thinktank/en/search.html?policyAreas=PETEUP

    “……She goes on to say that Latvia and Estonia bring a key question regarding citizenship to light i.e. the question of the agent of citizenship : who needs to act in issues regarding citizenship and whether it is the state´s task to confer citizenship or is it an individuals’ task to claim it.”
    from
    Naturalization and Citizenship in Latvia and Estonia
    16-05-2018
    http://www.europarl.europa.eu/RegData/etudes/IDAN/2018/604951/IPOL_IDA(2018)604951_EN.pdf

  8. Thanks @plaxy for that link, I always have trouble figuring out where things will be on the EU parl site. The debate should be interesting. And the one re the Privacy Shield as well.

  12. @ badger
    Sometimes I fear that they are more concerned about getting the reciprocity the US sorta-kinda-maybe promised but then did nothing about it than actually making the lives of their citizen/residents with a US taint more bearable.
    “The European Parliament regrets the inherent lack of reciprocity of the intergovernmental agreements signed by the member states, especially when it comes to the quantity of information that is exchanged …”
    I think they are secretly pleased that FATCA paved the way for their beloved CRS.

  13. we invite all member states to collectively suspend the application of their intergovernmental agreements until the US will agree to a multilateral approach to automatic information exchange,

    This seems clear to me and promising. They are saying the E U states should suspend the IGAs. The US will never agree to the CRS or equivalent reciprocity. Therefore the IGAs would remain suspended. Canada and Australia and others should follow their lead.

  14. Embee – I agree. The Council (representing the Member States) struck me as very hostile throughout the debate.

  15. @Embee, I think you’re right. I don’t see concern for their own citizens and residents. I see them rushing to take the easiest road – appeasing the US and rationalizing their failure to exercise a duty of care for their constituents and fellows.

    That is very evident when politicians in non-US countries and regions like the EU fall all over themselves rushing to raise and reiterated their respect for US sovereignty – but take pains not to ever acknowledge the extraterritorial and double taxation aspects, the US peculiarity of extraterritorially taxing people on the involuntary clinging US status – imposing citizenship but without any normative taxable economic relationship, the coercion inherent in FATCA’s imposition on the world via extortionate threat of unwarranted economic sanctions – at the world’s expense, the fact that EU citizens and residents must have more than a basic account to survive (which FATCA acts to deprive them of), etc.

  17. Thanks for finding that video, badger. Gotta say it again … Sophie in’t Veld … BLESS HER HEART!

  18. Thanks for the link, Badger. A glum summing-up, but there it is.

    “The only solution is for the governments of all the Member States to mandate the European Commission to negotiate an EU-wide FATCA IGA.”

    Unfortunately, there’s no sign that any Member State wants that to happen. And no reason to think the US would be any more interested in negotiating a reciprocal AEOI agreement with the EU, than it is in signing up to CRS.

    The EU Parliament report and resolution set out in the clearest possible terms the injustices of FATCA. That’s quite a significant gain, for USCs and former USCs living in the EU. It’s not going to morph into more than that.

    As Sophie in’t Veld says in that video, FATCA can only be changed by the US. Which barely notices the effects of its legislation on US-born residents of other countries.

    Nevertheless, there’s still a court case coming up in France.

  19. EmBee is right: it’s all about gaining more control over people’s finances. We are minor collateral damage. Governments need money and are addicted to control. Still, there is hope.

  20. Hope for what, is the question.

    Although I personally hope to see the birthplace targeting declared discriminatory by a French court or maybe (let’s hope) by the ECJ, it’s not clear to me what might follow.

  21. “Resolution of double taxation disputes in the European Union”

    https://ec.europa.eu/taxation_customs/business/company-tax/resolution-double-taxation-disputes_en_en

    On October 10th, the Council adopted new rules to better resolve tax disputes. These new rules will ensure that businesses and citizens can resolve disputes related to the interpretation of tax treaties more swiftly and effectively.

    The new rules will also cover issues related to double taxation which occurs when two or more countries claim the right to tax the same income or profits of a company or person.
    …
    taxpayers will have much more certainty when it comes to seeking resolution to their interpretation of tax treaties or double taxation problems. In particular, a wider range of cases will be covered and Member States will now have clear deadlines to agree on a binding solution, giving citizens and companies more timely decisions.

    A possible model for a solution to double-taxation disputes beyond the EU? The EU’s early AEOI schemes provided a precedent for the reporting of cross-border accounts within the EU, which the OECD later grafted onto the FATCA model to create CRS.

    If the US could be persuaded to agree to such a scheme it might relieve the burden on US-EU dual citizens who can’t afford to renounce.

  25. @Duality

    Pity there are several glaring inaccuracies in the preamble to the questions.

    ‘Accidental Americans’ are citizens of countries other than the US, who are also classified by the US tax office as US citizens eligible to pay tax as a result of having been born in the US — a status often unbeknown to these citizens until they are presented with a tax bill. The Foreign Account Tax Compliance Act (FATCA) forces non-US banks to provide the US tax office with details of any customer suspected of being an American citizen. Accidental Americans often have to pay large sums of money in accountancy and legal fees to comply with FATCA. Others choose to renounce their US citizenship, requiring payment of a fee of USD 2 350, the world’s highest.

    I don’t think it is ever the case that an accidental is suddenly made aware of their US citizenship when the IRS presents them with a tax bill. Not how it works. An accidental is unknown to the IRS until identified by FATCA via their bank (which tips off the accidental in question) but as we know, the IRS has not generated tax bills or even FBAR fines on the basis of FATCA information. Which in any case could not be collected from an accidental.

    Nobody has to pay large sums to comply with FATCA. All they need to do is identify themselves as a US person, and possibly obtain an SSN. They pay large sums to come into US tax compliance, should they choose to do so.

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