Insurers in the USA, Germany and Switzerland say a pledge announced last week at a meeting of the world’s biggest polluters to limit global temperatures is essential to controlling the cost of protecting property. Munich Re, the biggest reinsurer, and Zurich Financial Services AG back the target set by the European Union, the USA and 15 more nations to hold the planet to within 2 degrees Celsius (3.6 Fahrenheit) of pre-industrial times.
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Switzerland has strongly requested that a US court reject demands by the US Internal Revenue Service for information about US clients of UBS AG, saying disclosure would violate its sovereignty and international law. The Swiss government’s petition came in a federal court filing in Miami, where the. Internal Revenue Service is seeking to force UBS to reveal the identities of 52,000 Americans suspected of using accounts at the bank to hide about US$14.8B of assets and evade US taxes. “Switzerland’s laws prohibit the release of confidential information to foreign governments when the request has not been made through authorized intergovernmental channels,” the government said in its filing. “If the court were to order UBS to produce evidence from Switzerland, and backed that order with coercive powers, the court would be substituting its own authority for that of the competent Swiss authorities, and therefore would violate Swiss sovereignty and international law,” it said. Echoing a similar filing earlier in the day from UBS, it said Swiss government law also specifically prohibits release of the information demanded by the IRS.
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The Organization for Economic Co-operation and Development said on Friday that it regretted Switzerland’s decision to veto part of the OECD’s budget in a dispute over bank secrecy in the Alpine tax haven.
World leaders agreed at the recent G-20 summit to crack down on tax fraud and asked the OECD to publish lists of tax havens. Switzerland landed on a list of financial centers that have yet to deliver on pledges to meet international standards of bank information disclosure.
“The OECD acted in good faith,” OECD chief Angel Gurria said in a letter to Swiss President Hans-Rudolf Merz, a copy of which was released to journalists.
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The right-wing Swiss People’s Party (SVP) called on Saturday for retaliation against the United States over a U.S. tax probe into the country’s biggest bank UBS that threatens prized banking secrecy. The populist SVP, the country’s biggest party, said Switzerland should not take in any detainees from the US prison for terrorism suspects at Guantanamo Bay in Cuba, which the Swiss government said last month it could consider helping shut the camp down.
Switzerland should also reconsider its policy of representing the United States in countries where it has no diplomatic presence, the parliamentary SVP said in a statement. The SVP said Gold stored by the Swiss National Bank in the United States should be repatriated and Switzerland should ban the sale of US funds in the country to protect Swiss investors after the failure of U.S. regulators. The SVP has one minister in the seven-member Swiss government which is made up of the biggest four parties, but its populist policies have shaken up usually consensual Swiss politics.
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US efforts to force UBS AG, Switzerland’s largest bank, to disclose the names of 52,000 American customers would require the bank to violate Swiss sovereignty and criminal law, bank lawyers said.
A US lawsuit filed last week improperly seeks to enforce summonses from the Internal Revenue Service for the identities of account holders and would trample on Swiss sovereignty, according to a UBS filing in federal court in Miami. “Swiss law strictly prohibits UBS and its employees from disclosing to the IRS the account information located in Switzerland that the IRS seeks,” UBS lawyers wrote. “The IRS’s petition does not acknowledge these restrictions and instead simply ignores the existence of Swiss law and sovereignty.”
By trying to force disclosure, the IRS seeks to expose bank employees to “substantial prison terms, as well as fines, penalties and other sanctions,” bank lawyers wrote. The IRS also wants a judge to force UBS “to violate Swiss law in a manner that will expose it to penalties, civil liability and the possible revocation of its banking license.”
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