The UAE receives a vote of confidence form the European Union

The European Union (EU) is expected to remove eight countries, including the United Arab Emirates (UAE), from a 17-country “tax haven blacklist” of jurisdictions it published in December 2017, according to a Reuters report.

This is a very positive outcome for the UAE who where placed on an EU blacklist only last December. It ensures that the UAE can continue to grow as one of the strongest financial centres in the world. Following new commitment letters signed at high political level, the EU’s Code of Conduct working group on business taxation recommended to move the UAE out of a black list which was published by the EU last month.

The UAE formally signed up last year to the OECD’s automatic exchange of information programme known as the Common Reporting Standard (CRS), which means that beginning later this year, in September 2018, it will begin to automatically exchange financial account information under the OECD’s Multilateral Convention on Mutual Administrative Assistance, joining some 97 other jurisdictions that have signed up to the CRS MCAA.

The other seven countries expected to be removed imminently from the EU blacklist are South Korea, Panama, Barbados, Grenada, Macao, Mongolia and Tunisia,

Of the eight countries said to be in line to be removed from the blacklist, just four are among the 98 that have agreed to participate in the OECD’s Common Reporting Standard exchange of information convention. In addition to the UAE, Barbados, Panama and Grenada.

In a report said to be based on EU documents seen by its journalists, Reuters noted that the removal of Bahrain from the list “was also initially considered, but its delisting was eventually not recommended” by EU ministers involved in determining the list’s make-up.

Bahrain is one of three jurisdictions on the OECD’s CRS-implementing list that are, according to the Reuters’ report, set to remain on the EU’s blacklist. The other two are Saint Lucia and Samoa.

According to Reuters, the proposal to remove the eight jurisdictions will be discussed at a meeting of EU ambassadors tomorrow, “and is expected to be adopted by EU finance ministers when they meet next week, 23rd January 2018, in Brussels”.

The jurisdictions seen likely to remain on the blacklist, in addition to Bahrain, Saint Lucia and Samoa, are American Samoa, Guam, the Marshall Islands, Namibia, Palau, and Trinidad and Tobago.

The European Union drew up the blacklist in response to growing pressure on it to be seen to be doing something about tax evasion. The pressure came from a number of sources, including private interest groups and politicians from many EU countries.

At the time the list was unveiled last month, some critics argued that it was incomplete, as it left out a number of jurisdictions seen to be tax evasion facilitators, including Luxembourg and Malta.

The proposal for the delisting was made by the EU’s Code of Conduct Group, and it is on the European Minister’s agenda for their meeting next week.

Should you require any further information regarding the OECD or CRS compliance in the United Arab Emirates please contact our offices in Dubai:

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The UAE receives a vote of confidence form the European Union
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