A request for assistance from a State may not be acted upon if it violates the principle of good faith, in particular if it is based on information obtained through offences punishable under Swiss law, such as the theft of data.
A request for administrative assistance submitted to Switzerland by the French Directorate General of Public Finance in April 2014 on the basis of Art. 28 of the Agreement between Switzerland and France for the Avoidance of Double Taxation of Income and Capital and the Prevention of Fiscal Fraud and Tax Evasion (DTA CH-FR) concerns a French taxpayer and his wife who were suspected by the French tax authorities of holding an undeclared account at a bank in Switzerland. The French authorities had come across the couple's name in documents stolen by Hervé Falciani from the Geneva branch of the bank HSBC. The Federal Tax Administration (FTA) finally approved the request for administrative assistance in October 2014.
In its ruling of 22 October 2015 (A-6849/2014), the Federal Administrative Court upheld the appeal lodged by the parties concerned and overturned the FTA's decision. The Federal Administrative Court held that under the scope of application of Art. 7 lit. c of the Federal Act on International Administrative Assistance in Tax Matters (StAhiG), the FTA should not have acted on the French request for administrative assistance.
In the ruling of 17 March 2017 (2C_1000/2015), which is now available for official publication, the Federal Supreme Court confirms the opinion of the Federal Administrative Court and dismisses the appeal lodged by the FTA. In contrast to the recent judgement of 16 February 2017 (2C_893/2015), (cf. our contribution of 16 March 2017), this is a case of application of Art. 7 lit. c StAhiG, according to which a request for administrative assistance may not be granted if it is based on information obtained through acts that are punishable under Swiss law. The criminal origin of the "Falciani data" is undisputed, especially since Hervé Falciani was convicted by the Federal Criminal Court in November 2015.
The purpose of Art. 7 lit. c StAhiG is to specify the applicable principle of good faith ("principe de la bonne foi") in international public law in connection with stolen data (E. 6.2). France has made a commitment to Switzerland not to use the "Falciani data" to request Switzerland for administrative assistance in tax matters. This commitment binds France with regard to the principle of good faith (E. 6.4 in conjunction with E. 6.5). Switzerland may assume that it also extends to requests for administrative assistance that only have an indirect connection with the "Falciani data" (E. 6.5).
In the present case, according to the Federal Tribunal, it is established that the French tax authorities learned of the identity of the taxpayers on the basis of the "Falciani data", even though the bank account in question was only discovered during the investigation measures in the course of the tax audit that was subsequently opened. Against this background, the Federal Administrative Court rightly assumed that the FTA should not have responded to the French request for administrative assistance because the request was inadmissible under Art. 7 lit. c StAhiG.
On 5 April 2017, the Federal Supreme Court issued a press release on the present decision. In addition, an article and a corresponding commentary on the present decision were published in the NZZ of 5 April 2017.
