The ECJ recently confirmed (Ref. 33696/11), that a search of a flat may be carried out on the basis of data from a so-called Tax CD is lawful. The decision was based on the following facts: namely, that the tax investigation department had based its initial suspicion, which led to the search of a flat, on data that had been offered and purchased from a private individual.
The judges of the ECJ thereby confirmed that the use of purchased data is permissible under criminal law, as the Federal Constitutional Court had already (Decision of the Federal Constitutional Court of 9 November 2010 – 2BvR 2101/09).
Fundamentally, however, the question arises as to whether the purchase of so-called ‘tax CDs’ will still play a role in future, given the automatic exchange of information under the AEOI, as from 2017 onwards an increasing number of financial centres will automatically provide detailed information on investment income. The first exchange of data and information is expected to take place from September 2017. From September 2018, the exchange is then expected to take place indefinitely. As things stand, more than 65 countries are participating. These include the countries from which the majority of so-called tax CDs have come to date, namely Luxembourg, Switzerland and Liechtenstein. In this respect, the business of tax CDs is becoming a thing of the past. Nevertheless, precisely because of the automatic exchange of information, there is an increased need for action. Our specialist tax lawyers and tax advisers are available to assist with this.
Your contact at GWGL:
Matthias E. Grimme (Grimme@GWGL-Hamburg.de)