FATCA and the EU
April 2019
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
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
16: Are China, Russia, the EU and Switzerland poised to give in to FATCA?
January 2012
Fred(B): “The legislation is discriminatory but perhaps not enough for courts to rule it such. After all, CRS is now in full effect, and if you live in Germany and open an account in Spain the Spanish bank will automtically send your information to Germany. In effect the Spanish bank is discriminating against people who do not reside in Spain. I’m pretty certain that would be thrown out of court. For one thing, the bank is following the law, and for another it is not refusing service. It’s just reporting certain people according to the law.”
I agree. One would need to challenge the legislation, not sue the banks. There’s no basis for suing banks for complying with the law.
“The legislation is discriminatory but perhaps not enough for courts to rule it such.”
After trawling through some of the documents I’ve formed a suspicion that the court might rule that the discrimination is justified / not unreasonable/ does not result in a loss of EU Freedoms – or something similar.
@Fred(B), plaxy
I don’t think residence is a protected human characteristic, but national origin is one. We need to bear this in mind.
Duality – I agree, but as Fred suggested, the court might not consider the IGA national origin discrimination serious enough to rule that it must stop.
And anyway, no one is proposing to challenge it, so I guess the question is moot.
Upon reading the exchange, I began to wonder (again) what situation could force a clash with the bank and bring a case to court, in the EU.
It is probable that an accidental could build the best case. I’d say trying to get full banking services, while not being able to give a CLN or SSN, the either/or prerequisites now for opening any account, would be interesting. Only if the bank refused to accept self-certification of non-US Personhood because of a US birthplace (demanding a CLN) would there be a case.
That said, however, if push came to shove, the bank could decide to examine its policies and accept self-certification. If it refused, the local antidiscrimination agency would pressure it to do so, and if not, a local court might force it to, or the national banking association could issue adapted guidelines.
In the end, like the Belgian case, it would most probably putter out, and be resolved eons before any chance of reaching the ECJ.
Fred – It’s the government’s responsibility, because it’s the government that enacted the discriminatory legislation. So I believe that the dispute would be between the person or persons who has suffered discrimination, and the government.
Suing a bank wouldn’t get you anywhere. They have no obligation to open anything more than a basic payment account. And no obligation to apply the “cure” for US birth.
The more I look at it, the more likely it seems to me that the government would have taken legal advice on the discrimination issue.
@Fred (B)
“The EU would have forced the US to set up data protection… And it probably would have obtained preferential status for EU citizens living in the EU, regardless of US personhood, birthplace, etc.”
This could still be done if a mandate were handed to the Commission by the Member States. Perhaps the Commission could even do so unilaterally under their competence for tax matters. For example: http://europa.eu/rapid/press-release_IP-17-3702_en.htm
In her capacity as MEP, Ms Sophie in’t Veld could put a lot of pressure on the Commission to take action on this issue. She has been a godsend for all affected European citizens suffering under the Fatca regime.
@plaxy
“The Commission has been asked to consider whether the IGAs break EU law, and taken the view that the IGAs don’t break EU law because EU law only guarantees the right to a basic payment account, and the IGAs don’t contravene that right.”
The EU’s LIBE and ECON opinions were actually against the IGAs. In fact, I believe the IGAs do contravene the right to a basic payment account, as USPs (based on their place of birth) must still agree to the transmission of their personal data to the IRS as a prerequisite to opening a basic payment account. If they say “no” to this, then I guess no account?
@Fred (B)
“Courts could claim it’s not that hard and that yes, it’s not pleasant, but get your SSN, give the info to the bank, and then renounce or choose not to comply.”
I’ve been trying to relinquish officially at the local US Embassy for several years now, but the stumbling block has always been the fee of $2350. This is serious money for people like myself who are on modest incomes. No court could ever reasonably claim that this is “not that hard”…
@plaxy
“It affects all Model 1 residents with a US birthplace.”
In light of Fatca, perhaps it’s about time for all EU Member States to ban dual citizenship. I am, however, unsure about the legalities and logistics in doing so.
Duality – “The EU’s LIBE and ECON opinions were actually against the IGAs. “
Yes, but the Commission has not changed its position, which is that the IGAs don’t break EU law.
“In fact, I believe the IGAs do contravene the right to a basic payment account, as USPs (based on their place of birth) must still agree to the transmission of their personal data to the IRS as a prerequisite to opening a basic payment account. If they say “no” to this, then I guess no account?”
As I understand it, basic accounts are not reportable and would not be subject to due diligence screening. In any case, in Model 1 countries (which includes all EU countries), accountholders don’t get asked to agree to reporting. The accountholder’s permission is not needed.
“In light of Fatca, perhaps it’s about time for all EU Member States to ban dual citizenship. I am, however, unsure about the legalities and logistics in doing so.”
Some Member States do. It doesn’t help. USCs may be allowed to naturalize without renouncing, because of the difficulties, but they’re still USCs.
Many things might be done if Member States and/or the EU didn’t want FATCA, but they do.
Duality – if you find yourself unable to open an account without signing W9, providing SSN etc – one point to be aware of is that the W9 stays with the bank, it doesn’t get sent to the IRS. It’s infuriating, but it doesn’t mean you get pursued by the IRS.
I said: “…in Model 1 countries (which includes all EU countries), accountholders don’t get asked to agree to reporting. The accountholder’s permission is not needed.”
To elaborate – the purpose of FATCA letters is not to get you to agree to reporting: it’s to get your SSN and get you to sign a W9 which the bank can keep on your file in order to meet FATCA-compliance criteria and not get cast into the outer darkness of 30% withholding and reputational doom.
@plaxy
“Some Member States do. It doesn’t help. USCs may be allowed to naturalize without renouncing, because of the difficulties, but they’re still USCs.”
That is to say, forcible renunciation for Europeans born in the US but wishing to get rid of their imposed US citizenship. Non-residence tax liabilities would even be forcibly cancelled. Wishful thinking I suppose…
I’m afraid so. Those things can’t be done. Citizenship can only be ended by the state of citizenship.
The tax liability is not a problem though. The US can’t collect taxes outside US borders, and no country will collect another country’s taxes from its citizens. The IRS isn’t looking for expats, they’re looking for US-resident taxpayers who have made the silly mistake of hiding their money offshore instead of hiding it in Delaware or Nevada.
@plaxy
“if you find yourself unable to open an account without signing W9, providing SSN etc – one point to be aware of is that the W9 stays with the bank, it doesn’t get sent to the IRS. It’s infuriating, but it doesn’t mean you get pursued by the IRS.”
But I am simply unwilling to sign anything relating to the IRS. As I cannot afford a CLN, I am simply stuck in terms of opening a new account.
With my pre-existing account, I fibbed about my place of birth when asked one day at a branch. (They didn’t hold this information beforehand.) So I am able to carry on as normal. But I hate my bank with a passion and wish to switch to another. Tough luck. Is all of this nonsense really necessary?
Duality, have you considered DIY relinquishment?
If you took parttime or temporary work with a local council, with the intention of relinquishing US nationality, you would no longer be a USC. You could swear an affidavit to this effect (including proof of the employment), to show to a bank, along with a signed self-certification and your passport.)
If the bank refused to accept it, you could seek assistance from your parliamentary representative, or perhaps from the financial services regulator in your country.
Might be worth trying.
Duality – see http://isaacbrocksociety.ca/self-documented-relinquishment/
@plaxy
Thanks. I voluntarily relinquished my US citizenship by registering my birth at the local town hall where my parents had been registered. There was no oath to take, just a very simple process.
Whether I can self-certify is one huge question mark. That would depend on the structure of the bank’s computer system, the policies of the bank, the competence of the bank employee as well as the location of the branch (where US personhood is rare). It would be quite bizarre for me to self-certify a relinquishment of US citizenship when using my Member State passport to open an account within the same Member State.
“accepting, serving in, or performing the duties of any office, post, or employment under the government of a foreign state or a political subdivision thereof, after attaining the age of eighteen years if he has or acquires the nationality of such foreign state”
Would this not be limited to public policy roles as opposed to, say, an administrative role? Perhaps I’m wrong to think so….
” I voluntarily relinquished my US citizenship by registering my birth at the local town hall where my parents had been registered. There was no oath to take, just a very simple process.”
It sounds like you were not naturalising – just claiming as an adult the citizenship of your Member State as you were entitled to do because your parents had that citizenship (jus sanguinis)
If you had naturalised, that would be an expatriating act, but just registering your birth might not be, according to my (non-expert) reading of the US law (https://www.uscis.gov/ilink/docView/SLB/HTML/SLB/0-0-0-1/0-0-0-29/0-0-0-10446.html)
“Whether I can self-certify is one huge question mark. That would depend on the structure of the bank’s computer system, the policies of the bank, the competence of the bank employee as well as the location of the branch (where US personhood is rare). It would be quite bizarre for me to self-certify a relinquishment of US citizenship when using my Member State passport to open an account within the same Member State.”
You have to show your passport to prove you have a citizenship that is not US.
Three items for self-certification:
1 – Self-certification form, stating you are not a USP
2 – Documentary evidence to support your statement
3 – Non-US passport
The bank may not accept your affidavit, but in that case you could go to yout parliamentary rep or the banking regulator, and hopefully get a definitive answer, from your own country (not the damned US) as to the validity of your self-certification.
“Would this not be limited to public policy roles as opposed to, say, an administrative role? Perhaps I’m wrong to think so….”
Sec. 349(a)(4)(b) requires an oath but 349(a)(4)(a) does not. No idea why.
@plaxy
“It sounds like you were not naturalising – just claiming as an adult the citizenship of your Member State as you were entitled to do because your parents had that citizenship (jus sanguinis)”
In which case I may still be a so-called US person. Maybe yes, maybe no; relinquishment or renunciation. The truth is I myself have never been quite sure about my status. Nevertheless, I am now in Europe and have been living here long enough. Fortunately, by way of fibbing my place of birth, I am able to bank like so many other Europeans (at least for now).
As I am considering moving to another Member State for professional reasons in the near future, it will be interesting to see how the banks will treat me.
@ Duality,
Re:
The level of the government job only reverses the administrative presumption.
Department of State’s general administrative presumption is that a person who performs a potentially relinquishing act, such as naturalising (s. 349(a)(1) Immigration and Nationality Act) or accepting government employment (s. 349(a)(4)) intends to keep their US citizenship.
However, there is an exception for policy level positions. In that case, the presumption is reversed and it’s presumed the person intends to relinquish their US citizenship.
In practice it doesn’t matter much as, in either case, the presumption is rebuttable.
FWIW, all Brockers who have relinquished due to government employment have been in positions below the policy level.
For more information, Foreign Affairs Manual 1280, Loss of Citizenship and Taking Up a Position in a Foreign Government.
@ Plaxy,
Re:
S. 349(a)(4)(B) applies to people who do not have or do not acquire the nationality of the country for which they accepted/served/performed the government employment.
So, if you’re a citizen of Country A and not of Country B, but Country B offers you a job, even though you’re not a citizen, which you accept, and you have to take an oath of allegiance to Country B as part of taking the job, you’d use 349(b).
Doesn’t sound like a common scenario at all — I would guess they’re extremely rare.
Someone like Mark Carney, perhaps? 🙂
Thanks for the explanation.