Andorran lawmakers have agreed to end banking secrecy in the Pyrenees mountains principality once considered a tax haven, approving automatic sharing of information on accounts held by non-residents.
The General Council, the unicameral parliament, approved on Wednesday the measure which will come into effect from January 2018 for accounts held by residents of EU countries.
"Not approving this would have sent a very negative message to the world," Finance Minister Jordi Cinca told the lawmakers.
Nestled in the Pyrenees between France and Spain, banking accounts for 20 percent of the economy in the nation of barely 90,000 citizens.
Andorra was briefly on the OECD's "gray list" of non-cooperative tax havens drawn up as part of a crackdown on tax evasion after the global financial crisis.
In 2015, the Banca Privada d'Andorra (BPA), the principality's fourth largest bank was accused by a unit of the US Treasury Department of having taken bribes to channel profits and facilitate laundering of cash from Russian and Chinese organised crime as well as Venezuela's state oil firm PDVSA.
The charge led Andorran regulators to take control of the bank, whose chief executive was arrested.
Automatic transfer of banking account data is becoming the international standard to help reduce tax evasion.
Andorra follows Monaco, Switzerland, Liechtenstein and San Marino in signing a deal with the EU, which wants to cut down on fraud and tax evasion via neighbouring countries.
Andorran lawmakers have agreed to end banking secrecy in the Pyrenees mountains principality once considered a tax haven, approving automatic sharing of information on accounts held by non-residents.
The General Council, the unicameral parliament, approved on Wednesday the measure which will come into effect from January 2018 for accounts held by residents of EU countries.
“Not approving this would have sent a very negative message to the world,” Finance Minister Jordi Cinca told the lawmakers.
Nestled in the Pyrenees between France and Spain, banking accounts for 20 percent of the economy in the nation of barely 90,000 citizens.
Andorra was briefly on the OECD’s “gray list” of non-cooperative tax havens drawn up as part of a crackdown on tax evasion after the global financial crisis.
In 2015, the Banca Privada d’Andorra (BPA), the principality’s fourth largest bank was accused by a unit of the US Treasury Department of having taken bribes to channel profits and facilitate laundering of cash from Russian and Chinese organised crime as well as Venezuela’s state oil firm PDVSA.
The charge led Andorran regulators to take control of the bank, whose chief executive was arrested.
Automatic transfer of banking account data is becoming the international standard to help reduce tax evasion.
Andorra follows Monaco, Switzerland, Liechtenstein and San Marino in signing a deal with the EU, which wants to cut down on fraud and tax evasion via neighbouring countries.
