The Global Forum and the peer reviews of Switzerland

The standard and its elements

The Global Forum on Transparency and Exchange of Information for Tax Purposes is the body, hosted by the OECD, that monitors the implementation of two international standards: exchange of information on request (EOIR) and the automatic exchange of financial account information (AEOI). Its peer reviews assess each member against ten elements grouped in three blocks. Block A concerns the availability of information: legal and beneficial ownership (A.1), accounting records (A.2) and banking information (A.3). Block B concerns the access of the competent authority to that information (B.1) and the rights and safeguards of taxpayers (B.2). Block C concerns the exchange itself: the legal mechanisms (C.1), the network of partners (C.2), confidentiality (C.3), the rights and safeguards of taxpayers in the exchange (C.4) and the quality and timeliness of responses (C.5).¹ Each element and the jurisdiction as a whole receive one of four ratings: compliant, largely compliant, partially compliant or non-compliant.

The ratings matter because they feed into the lists of non-cooperative jurisdictions kept by the European Union and by individual states, including the Italian lists that Chapter E.II discusses. A jurisdiction rated partially compliant or non-compliant overall risks defensive measures by its partners. For a financial centre such as Lugano, whose clients and counterparties sit largely in the European Union, an overall rating of largely compliant is the minimum condition for doing business without additional scrutiny.

The reviews of 2016 and 2020

Switzerland underwent its first combined review in the first round and was rated largely compliant in 2016. The second round applied a stricter standard that included, for the first time, beneficial ownership information and the treatment of group requests. Switzerland was again rated largely compliant in the report published in April 2020.² The overall rating hid two weaknesses. Element A.1 on legal and beneficial ownership was rated partially compliant, as was element C.3 on confidentiality.³ Element Subject Rating 2020 A.1 Ownership information Partially compliant A.2 Accounting records Compliant A.3 Banking information Largely compliant B.1 Access to information Compliant B.2 Rights and safeguards Largely compliant C.1 Exchange mechanisms Largely compliant C.2 Network of partners Compliant C.3 Confidentiality Partially compliant C.4 Rights in the exchange Largely compliant C.5 Quality and timeliness Largely compliant Overall Largely compliant

Source: Global Forum, Peer Review Report on the Exchange of Information on Request: Switzerland 2020.⁴

The recommendations under A.1 concerned precisely the questions that the TJPG now addresses. The Global Forum asked Switzerland to monitor the transitional rules on bearer shares and to ensure that accurate and up-to-date beneficial ownership information was available for all relevant entities and arrangements. It also asked Switzerland to introduce enforcement mechanisms for the registration duties of foreign companies with their effective administration in Switzerland, since the Federal Tax Administration had no powers to enforce them.⁵ Under C.3 and C.4 the reviewers criticized the Swiss practice of notifying the persons concerned before the exchange, which could delay the transmission of information and in some cases alert the taxpayer. The tension between the Swiss procedural guarantees and the expectations of requesting states, among them Italy, runs through all Swiss practice in administrative assistance.

Notes

1. Global Forum on Transparency and Exchange of Information for Tax Purposes, Switzerland 2020 (Second Round): Peer Review Report on the Exchange of Information on Request (OECD, Paris 2020), https://www.newsd.admin.ch/newsd/message/attachments/60887.pdf, which sets out the ten essential elements A.1 to C.5 of the 2016 Terms of Reference and rates Switzerland against each of them. ↩
2. State Secretariat for International Finance (SIF), "Global Forum", https://sif.admin.ch/en/global-forum-en (largely compliant in 2016 and in the second round of 2020, the latter including "the quality of administrative assistance requests, group requests and the identification of beneficial owners"); Federal Council press release of 6 April 2020 (above). ↩
3. Global Forum, Peer Review Report on the Exchange of Information on Request: Switzerland 2020 (Second Round) , OECD, Paris 2020, published by the Swiss authorities at https://www.newsd.admin.ch/newsd/message/attachments/60887.pdf, table of ratings. ↩
4. Global Forum, Switzerland 2020 (above), table of determinations and ratings. ↩
5. Global Forum, Switzerland 2020 (above), recommendations under element A.1 on bearer shares (transitional rules), beneficial ownership information and foreign companies with effective management in Switzerland. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.