Swiss handover of UBS client data delayed by political row

City A.M. Reporter
SWITZERLAND’S delivery of UBS client data to US tax officials has been delayed after the Swiss lower house rejected the Swiss-US deal to solve a tax row, triggering a new parliamentary debate.

Yesterday’s last-minute rejection by the main arm of parliament contradicts a vote in favour of the deal by the upper house last week, meaning the two houses will have to try and work out an agreement over a common text before a final vote later this month.

Washington agreed on 19 August 2009 to drop tax evasion charges against UBS after Berne promised it would transfer bank details of 4,450 US clients of UBS by the end of August, in breach of Swiss bank secrecy laws.

But a Swiss court in January blocked the data transfer, forcing the government to bypass the ruling with a legal patch that requires parliamentary approval and risks delaying the sharing of bank client information beyond the August deadline.

The lower house’s vote against the deal is another headache for the government, which has struggled to win political support for the deal, seen in Switzerland as a capitulation to the US to get the country’s largest bank, UBS , off the hook.

The US had accused UBS of helping rich Americans hide almost $20bn of untaxed money in secret accounts.