Jersey and Bermuda no longer figure on a French government blacklist of states that are uncooperative in the exchange of information with France’s tax authorities, according to decree published on Sunday in the official gazette Le Journal Officiel and which backdates their removal to January 1st.
The French finance ministry, which took the decision, cited their recent cooperation on the exchange of information with the French tax authorities, including less recent cooperation requests that had previously gone unanswered.
“They have responded to all France’s requests for information,” read a statement issued by French finance minister Pierre Moscovici. “Furthermore, Jersey has agreed to modify its interpretation of the [international cooperation] convention to lift technical obstacles for the obtaining of information by France.”
“The objective is not that tax havens be on the lists, it is that tax havens disappear,” the statement added.
Jersey, a British Crown dependency situated in the Channel Islands close to north-west France, and the Islands of Bermuda, a British Overseas Territory that lies about 1,000 kilometres off the east coast of the US, were added to the French government’s blacklist of ‘uncooperative jurisdictions’ in August 2013.
France has pledged to take financial sanctions against those who still figure on the list every January 1st following the date of their addition to it. The finance ministry argued that it would have been illegal to penalize Jersey and Bermuda since they had, since last August, now met French demands for cooperation. “But if they again cease to cooperate, we could put them back on the list,” said a finance ministry spokesperson.
But the decision to rehabilitate them has outraged senior members of the socialist government’s parliamentary majority and was informally opposed, according to Mediapart sources, by French foreign affairs minister Laurent Fabius whose ministry has a consultative role in such cases. He reportedly advised Moscovici that the move was “not politically opportune”.
Contacted on Monday, the foreign affairs ministry declined to comment on the issue.
Former socialist justice minister and chairwoman of the French parliament's foreign affairs committee, Elisabeth Guigou, together with the Socialist Party's general rapporteur on budget affairs, Christian Eckert, denounced the “unjustified” removal of Jersey and Bermuda from the blacklist. “With regard to the latest work of the Global Forum on Transparency, published after the meeting in Jakarta on November 21st and 22nd, such a removal is not justified,” they said in a joint statement issued immediately after the decree was published on Sunday. “Neither Jersey nor Bermuda have obtained an overall notation to justify this removal.”
The French Green party Europe Ecologie-Les Verts (EELV) earlier this month also fiercely opposed the move, which Moscovici and budget minister Bernard Cazeneuve had first announced as imminent last December 20th. In a letter addressed on January 15th to both Moscovici and Fabius, EELV European Parliament member Eva Joly, a former examining magistrate, a high-profile anti-corruption campaigner and her party’s candidate during the 2012 French presidential elections, wrote that “to want to remove the Bermuda islands and Jersey from the list of uncooperative states and territories seems to me to be absurd.”
She argued that the recent cooperation of both territories was an insufficient argument given that they had still not accepted the principle of an automatic exchange of tax-related information nor that of recording information on trusts.
In her letter (see copy published below), she suggested the government had buckled under pressure from French business corporations with investments in Jersey and Bermuda. Under French law, they faced paying higher tax rates in France if the territories had remained blacklisted. “How can one not make a link between the financial sanctions that threaten our [French] companies and the removal of Bermuda and Jersey from the blacklist?” she wrote. “It is also during these moments that our government places its credibility at stake over its capacity to not give in to pressure from major corporations which are the champions of tax evasion […] The hand of the French government had already trembled when defending the bill of law on the separation of banking activities.”
Joly argued to Moscovici and Fabius that “our neighbours Luxembourg and Switzerland” should also be added to the blacklist. Until now, she has received no response to her letter.
A bill of law setting out a raft of tough new measures in the fight against tax evasion, and which was last November approved by French parliament, allowed for any country that refused the automatic exchange of information to be placed on the blacklist of ‘uncooperative’ states and territories. However, this was later annulled by France’s Constitutional Council on the basis that France had not begun bilateral negotiations for an exchange of information.
Following Sunday’s decree, those now remaining on the French blacklist list of non-compliant countries or territories are the British Virgin Islands, Brunei, Montserrat, Bostwana, Guatemala, Nauru, the Marshall Islands and Niue.
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English version by Graham Tearse