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Source : © European Union, 2016 - EP

Thank you very much, especially for your hospitality. Premier Li, I am very pleased to meet with you again for the 18th EU-China Summit! It is not the first time we meet but it is our first meeting here in Beijing.

Today's meeting gives us the opportunity to demonstrate the strength of our Strategic Partnership. Especially in these testing times, as EU and China have both a stake in each other's success.

The European Union welcomes China's Presidency of the G20 this year. You can count on the EU to play a constructive role towards achieving a successful summit in Hangzhou. As two of the largest economies in the world, the EU and China have an important stake, as well as responsibility, in ensuring the growth and stability of the global economy.

The European Union looks forward to closely work with China to resolve international conflicts and address foreign policy priorities. We have to employ all existing channels in both the bilateral and in multilateral contexts, such as the United Nations and the G20. Building on the positive experience of the Iran nuclear talks, we are confident there is much we can contribute to peace and prosperity around the world, especially in Syria, Iraq, Afghanistan or Africa.

The same goes for global issues, like migration, international development assistance, the environment and fighting climate change. These are challenges that can only be resolved through a global response. For this reason, a collaborative EU-China relationship is crucial.

We came here to discuss common challenges, and to do so in a friendly manner. One of those is the protection of the rule-based international order. This may be the biggest challenge ahead of us. It is both in the Chinese and European interest to protect international cooperation based on common rules.

Let me just name one example: Globalisation. It brings so many benefits to our nations. Unfortunately, more and more people feel that it is happening without rules. And if we let these feelings grow, if many start believing that globalisation and international trade are happening without or against common rules, then the first victims will be the Chinese and European economies, not to mention people. That is why we are so openly raising these issues, because we believe a frank discussion is in our mutual interest.

As in every mature partnership we may sometimes have differences of opinion. And being able to discuss these differences openly is part of the strength of our relationship. This is the case, for example, with our discussion on human rights and the rule of law. I stress the importance for the European Union of the freedom of the press, the freedom of expression, association and assembly, including for minorities. I hope that the next session of the human rights dialogue will take place in November in Brussels.

Finally, on the South China Sea we will see an important ruling today. Therefore let me repeat this: The rule-based international order is in our common interest and both China and the EU have to protect it, as this is in our people's best interest.

I am pleased, Mr Premier, that we have this timely opportunity to address our substantial common agenda. Today's summit should send a message to our people and to the rest of the world of our joint commitment to our Strategic Partnership. Thank you.

Good evening everyone, thank you for joining us.

This was our first meeting since the UK referendum so when discussing the economic situation in the euro area we of course also focused on the effects of the outcome of the UK referendum, talked about market reaction, the impact in Europe and in the Eurozone in particular. Of course, there is a high degree of uncertainty at this point on what the economic impact will be, as well as what the political impact will be throughout the Eurozone area. But it doesn't change our commitment to continue to work on sound growth-friendly fiscal policy, structural reforms, and sorting out the banking sector. Basically our agenda and our commitment to that agenda is unchanged.

On fiscal policies in specific we of course discussed Spain and Portugal following the recent Commission recommendations, or more specifically the recommended decisions by the Commission. I will not go into detail now given that we will discuss it at the Ecofin; it is an Ecofin decision. Let me just stress that the discussion is at this stage only about the question whether there is effective or ineffective action in Spain and Portugal. It was not on the follow-up decisions regarding sanctions, possible sanctions or the effect of actions this and in the coming years. So it was just about looking back. There was strong support for the two Commission recommendations today. We agreed that we should continue swiftly with the next steps in the procedures so that we give clarity and certainty to all involved as soon as possible.

We also briefly took stock of the latest post-programme surveillance (PPS). This was for Ireland and Portugal.

In Ireland, the good progress continues and there is no reason for great concern.

For Portugal, there are a few more concerns, risks in the economy and in the banking sector, which are acknowledged also of course by the Portuguese authorities. They are committed to work on that as well as to work on budgetary issues.

Both of these programmes will have another post-programme surveillance later on.

Finally we had a broad discussion on reducing barriers to investment, both on the public and private side. On the public side the discussion focused on the criteria for the investment clause, some statistical issues on how to deal with investments from public budgets. And on the private side we focused, on the basis of the paper the Commission prepared, on a couple of areas where work should be done to improve the efficiency of public administration, the business environment in our countries, and sector-specific burdens that hinder further private investments. More work will be done on that and we will continue on that topic later this year.

The European Fund for Strategic Investments (EFSI), commonly referred to as the Juncker Plan, is off to a good start, stimulating pledges from not only European but also non-EU countries like China.

The plan is to raise a considerable sum of €315bn over three years by working with the European Investment Bank (EIB), which will issue bonds to finance projects that develop energy and other infrastructure projects, as well as improve funding for SMEs. This is indeed the right way to leverage a relatively small sum into an ambitious pool of money. In detail, the EU has itself invested €8bn on top of an existing €8bn budget as well as a further €5bn put in by the EIB. The top AAA-rated EIB can then issue bonds, taking advantage of record-low interest rates, to leverage the initial €21bn into a fund large enough to make a difference in jump-starting European growth.

The EFSI ambitiously seeks to encourage private companies to make the investment, thereby largely reducing the impact of the plan on government fiscal positions. But that means a reliance on public-private partnerships, which have a mixed record when it comes to maintaining long-term infrastructure projects such as railways. Nevertheless, the debate over whether governments should be borrowing so as to invest is a separate one.

“The EFSI means a reliance on public-private partnerships, which have a mixed record on long-term infrastructure projects”

The focus on investment, with the usual caveats, should be welcome in Europe. After all, it’s well established that rich countries could use a rejuvenation of their infrastructure. During the last recession, it was public investment that was slashed as a part of austerity programmes, bringing large hits to infrastructure. Investment in the eurozone is still around 15% below its pre-crisis level. Yet ratings agency S&P have estimated that a 1%-of-GDP increase in government spending on infrastructure would translate into a bigger bang, increasing the eurozone economy by 1.4%. Their estimate is even bigger for rich countries like Britain, where GDP would expand by 2.5%. The OECD goes further to stress that increases in public investment would boost economic growth and thus cut government debt. So why has it been so difficult to raise investment since the crisis?

The main constraint has been the imposition of fiscal austerity by governments that have been too focused on the budget deficit. It’s only in the very recent past that economic growth has come back into focus. That largely explains the public side, but private investment has also dropped sharply since the recession. German companies, for instance, have doubled their retained cash in the past decade, and others have followed suit. The puzzle as to why these companies don’t invest is key to understanding how one of the pillars of growth hasn’t delivered during the recovery.

Government and consumer spending were hit hard and slow to recover, leaving deficient demand, both public and private, that hasn’t given companies the impetus to invest. The sharpness and the duration of the Great Recession also created uncertainty over whether or not to commit funds for investment stretching well into the future. European economies are now largely back on their feet. And the recent focus on growth not just by the European Commission but also national governments offers more opportunity. The opening up of strategic sectors like energy to private investors could offer stable returns at a time when it’s challenging to put your money to work.

The low returns of the post-crisis environment affected infrastructure investments because there were other, more enticing, places to put your cash. Stocks, for instance, were pushed to sky-high levels by cheap money and zero interest rates across major markets such as Germany’s Dax. But global stock markets are now deflating from their heady heights while interest rates are still rock bottom in Europe, so fixed income investments continue to generate low returns.

“Investing in roads or energy doesn’t reward a high return though does tend to be stable”

And there’s now an uncertainty from the divergence between the tightening, or normalisation, of rates in America while the European Central Bank continues to inject cheap cash and has even set negative deposit rates for the banking system. This makes an investment with fixed returns, such as in infrastructure, relatively more attractive. Traditionally, investing in roads or energy doesn’t reward a high return though does tend to be stable. Usually set by regulators, yields from infrastructure such as utilities and toll roads range from 3-4%. In the current low-rate environment, that’s not a bad return.

Indeed, BlackRock estimates that insurers are putting 15% of their investment portfolios, double the pre-crisis figure, into infrastructure. And they’re not the only ones. Chinese businesses have also recently invested in European utilities such as water for a predictable long-term return. There are, then, good reasons to have confidence in the Juncker Plan.  Aside from China, other countries such as those in the Middle East as well as private companies sitting on cash may well consider putting some of their funds into Europe.

There’s no shortage of projects being proposed by EU member states for investors to choose from. The potential gains from the investment may well outweigh the downsides of public-private partnerships at present. Another upside is how much the European economy could be boosted by greater investment. Growth in the world’s largest economic entity would undoubtedly be welcome to the rest of the world.

IMAGE CREDIT: landio/Bigstock.com

The post Infrastructure holds Europe’s untapped potential appeared first on Europe’s World.

On 30 June from 9.00, BUDG committee will hold a high-level joint hearing with LIBE, AFET and DEVE committees on the budgetary implications of the refugee and migration crisis. The keynote speech will be given by Mr George Soros, founder and Chair of Open Society foundations. Other speakers include the Commission's Directors General for Budget, DEVCO and NEAR, Directors of Frontex and EASO, the UNHCR Europe Director, ECRE Secretary General and Oxfam representative.

MEPs will discuss the past andpresent budgetary initiatives, solidarity and cost-sharing between MemberStates and the EU external actions' financing in relation to the crisis.

Location : Paul-Henri Spaak PHS 3C50 (3rd floor), European Parliament, Rue Wiertz 60, Brussels, Belgium
Programme
Draft Programme
Statement submitted to the European Parliament Joint Hearing by George Soros on 30 June 2016
Interview - Refugee and migration crisis: the financial cost
Extracts from the Joint Hearing
Source : © European Union, 2016 - EP

Members of Parliament’s Budgets and Economic and Monetary Affairs committees debated the need for a euro area budget with finance ministers Jeroen Dijsselbloem (Netherlands, also Euro Group President), Michel Sapin (France), Pier Carlo Padoan (Italy), Pierre Gramegna (Luxembourg), Peter Kažimír (Slovakia), Edward Scicluna (Malta) and Euclid Tsakalotos (Greece) on Monday evening.
Committee on Economic and Monetary Affairs
Committee on Budgets

Source : © European Union, 2016 - EP

Members of Parliament’s Budgets and Economic and Monetary Affairs committees debated the need for a euro area budget with finance ministers Jeroen Dijsselbloem (Netherlands, also Euro Group President), Michel Sapin (France), Pier Carlo Padoan (Italy), Pierre Gramegna (Luxembourg), Peter Kažimír (Slovakia), Edward Scicluna (Malta) and Euclid Tsakalotos (Greece) on Monday evening.
Committee on Economic and Monetary Affairs
Committee on Budgets

Source : © European Union, 2016 - EP

Source : © European Union, 2016 - EP

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EU Finance ministers meet in Brussels on 12 July 2016.

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General : New gun control rules, making it more difficult for terrorists to have access to them, are voted on by the internal market committee this week. In addition the budgets and economic committees discuss the eurozone's future development with Eurogroup president Jeroen Dijsselbloem and the finance ministers of France, Greece, Italy, Luxembourg, Slovakia and Malta. A delegation of MEPs is also visiting refugee camps near Calais.

Source : © European Union, 2016 - EP

General : New gun control rules, making it more difficult for terrorists to have access to them, are voted on by the internal market committee this week. In addition the budgets and economic committees discuss the eurozone's future development with Eurogroup president Jeroen Dijsselbloem and the finance ministers of France, Greece, Italy, Luxembourg, Slovakia and Malta. A delegation of MEPs is also visiting refugee camps near Calais.

Source : © European Union, 2016 - EP

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The Informal meeting of Environment Ministers takes place on 11 and 12 July 2016 in Bratislava.

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As Brexit Britain weighs the option of a free-trade agreement to access to the EU single market, it would do well to consider the sobering example of a similar deal betweenEurope and Canada. It is relatively uncontentious, yet floundering in choppy political waters.

Known as CETA, talks on a deal concluded almost two years ago, and opposition to it has been growing ever since. Intertwined in the public consciousness with a much bigger trade pact that’s in the works with the US, the deal has become a prime target for green groups, trade unions and left wing parties, which see it as a free-market attack on regulation.

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Plenary sessions : Human trafficking is a highly profitable international crime in which people are traded for use in prostitution, forced labour or other forms of exploitation. In a resolution adopted in plenary last week, MEPs condemned it as a modern kind of slavery and one of the worst forms of human rights violations. Resolution author Barbara Lochbihler, a German member of the Greens/EFA group, told us victims needed more protection and that more needed to be done on forced labour and money laundering.

Source : © European Union, 2016 - EP

Plenary sessions : Human trafficking is a highly profitable international crime in which people are traded for use in prostitution, forced labour or other forms of exploitation. In a resolution adopted in plenary last week, MEPs condemned it as a modern kind of slavery and one of the worst forms of human rights violations. Resolution author Barbara Lochbihler, a German member of the Greens/EFA group, told us victims needed more protection and that more needed to be done on forced labour and money laundering.

Source : © European Union, 2016 - EP

On 12 July 2016, the Council found that Portugal and Spain had not taken effective action in response to its recommendations on measures to correct their excessive deficits. 

It confirmed that they will not have reduced their deficits below 3% of GDP, the EU's reference value for government deficits, by the recommended deadline. And in both cases, it found the fiscal effort to fall significantly short of what was recommended. 

The Council's decisions will trigger sanctions under the excessive deficit procedure. They are based on article 126(8) of the Treaty on the Functioning of the European Union. 

The Commission has 20 days to recommend further Council decisions imposing fines. Those fines should amount to 0.2% of GDP, though Portugal and Spain can submit reasoned requests within 10 days for a reduction of the fines. The Council will have 10 days to approve the fines. 

"I am sure that we will have a smart, intelligent result at the end”, said Peter Kažimír, minister for finance of Slovakia and president of the Council.

Portugal  

In April 2011 however, after several months of market pressure on its sovereign bonds, Portugal requested assistance from international lenders. It obtained a €78 billion package of loans from the EU, the euro area and the IMF. In October 2012, the Council extended the deadline for correcting Portugal's deficit by one year to 2014, in the light of the recession that the country faced. 

Economic prospects deteriorated further, and Portugal's general government deficit reached 6.4% of GDP in 2012. In June 2013, the Council extended the deadline for correcting the deficit by another year, to 2015. It set headline deficit targets of 5.5% of GDP in 2013, 4.0% of GDP in 2014 and 2.5% of GDP in 2015, consistent with 0.6%, 1.4% and 0.5% of GDP improvements in the structural balance respectively. 

Portugal exited its economic adjustment programme in June 2014. 

However its general government deficit came out at 4.4% of GDP in 2015, and the deadline was missed for correcting the deficit. The overshoot was largely due to a financial sector support measure (resolution of Banif), though the deficit net of one-off measures would in any case have been above 3% of GDP. The cumulative improvement in Portugal's structural balance in the 2013‑15 period is estimated by the Commission at 1.1% of GDP, significantly below the 2.5% recommended by the Council. When adjusted in the light of revised potential output growth and revenue windfalls or shortfalls, it is even slightly negative. 

Overall, since June 2014 the improvement in Portugal's headline deficit has been driven by economic recovery and reduced interest expenditure in a low-interest-rate environment. The country's general government gross debt has broadly stabilised. It amounted to 129.2% of GDP at the end of 2013, 130.2% of GDP in 2014 and 129.0% of GDP in 2015, according to the Commission's spring 2016 economic forecast. 

The Council concluded that Portugal 's response to its June 2013 recommendation has been insufficient. Portugal didn't correct its deficit by 2015 as required, and its fiscal effort falls significantly short of what was recommended by the Council. 

Spain 

Spain has been subject to an excessive deficit procedure since April 2009, when the Council issued a recommendation calling for its deficit to be corrected by 2012. 

In December 2009 however, the Council extended the deadline to 2013. The Commission forecast that Spain's 2009 deficit would reach 11,2 % of GDP, five percentage points more than its previous estimate. 

In July 2012, the Council extended the deadline for a further year to 2014 on account of renewed adverse economic circumstances. The Commission projected that Spain's general government deficit would reach 6.3% of GDP in 2012, compared to the 5.3% previously expected. 

Also in July 2012, the euro area member states agreed to provide up to €100 billion of loans for the recapitalisation of Spain's financial services industry. 

In June 2013, the Council found that Spain fulfilled the conditions for extending the deadline for correcting its deficit by a further two years, setting a new deadline of 2016. It set headline deficit targets of 6.5% of GDP for 2013, 5.8% of GDP for 2014, 4.2% of GDP for 2015 and 2.8% of GDP for 2016, consistent with 1.1%, 0.8%, 0.8% and 1.2% of GDP improvements in the structural balance respectively. 

Spain exited the financial assistance programme for the recapitalisation of its financial institutions in January 2014. It had used close to €38.9 billion for bank recapitalisation, plus around €2.5 billion for capitalising the country's asset management company. 

Spain's general government deficit amounted to 5.9% of GDP in 2014 and 5.1% of GDP in 2015. above the intermediate targets set by the Council. A relaxation of fiscal policy in 2015 had a large impact on the fiscal outcome. The cumulative improvement in the structural balance over the 2013‑15 period amounted to 0.6% of GDP, significantly below the 2.7% recommended by the Council. When adjusted in the light of revised potential output growth and revenue windfalls or shortfalls, it is even lower. 

Over the 2013‑15 period, low or even negative inflation made achievement of the fiscal targets more difficult, but this was largely offset by higher-than-expected real GDP growth. A low interest rate environment has also helped Spain reduce its deficit. The Commission's 2016 spring economic forecast projects a general government deficit of 3.9% of GDP in 2016 and 3.1% of GDP in 2017. Spain is therefore not set to correct its deficit in 2016 as required. The debt-to-GDP ratio declined from 99.3% in 2014 to 99.2% in 2015, thanks to sales of financial assets. According to the Commission's 2016 spring forecast, the debt ratio is expected to rise to 100.3% in 2016 and decline thereafter. 

The Council concluded that Spain 's response to its June 2013 recommendation has been insufficient. Spain didn't reach the intermediate target set for its headline deficit in 2015 and is not forecast to correct its deficit by 2016 as required. Its fiscal effort falls significantly short of what was recommended by the Council, and it even relaxed its fiscal stance in 2015. 

 On 12 July 2016, the Council issued recommendations on economic, employment and fiscal policies planned by the member states. 

The Council thereby concluded the 2016 "European Semester", an annual policy monitoring process. The European Council endorsed the recommendations at its meeting in June. 

"We look forward to the effective implementation of these country-specific recommendations in the coming months“, said Peter Kažimír, minister for finance of Slovakia and president of the Council. 

In March 2016, the European Council endorsed the following priorities: 

• relaunching investment;
• pursuing structural reforms to modernise European economies;
• conducting responsible fiscal policies.

Monitoring policies 

The European Semester involves simultaneous monitoring of member states' economic and fiscal policies during a roughly six-month period every year. 

In the light of policy guidance given by the European Council annually in March, the member states present each year in April: 

• National reform programmes for their economic and employment policies. These set out a macroeconomic scenario for the medium term, national targets for implementing the "Europe 2020" strategy for jobs and growth, identification of the main obstacles to growth, and measures for growth-enhancing initiatives in the short term. 
• Stability or convergence programmes for their fiscal policies. Eurozone countries present stability programmes, whereas non-euro member states present convergence programmes. These set out medium-term budgetary objectives, the main assumptions about expected economic developments, a description of fiscal and economic policy measures, and an analysis of how changes in assumptions are susceptible to affect fiscal and debt positions. 

The Council then adopts country-specific recommendations (CSRs). It provides explanations in cases where the recommendations do not correspond with those proposed by the Commission. 

Recommendations 

The 2016 CSRs are addressed to 27 of the EU's 28 member states. To avoid duplication there is no CSR for Greece, as it is subject to a macroeconomic adjustment programme. 

In March 2016, the Council adopted a specific recommendation on the economic policies of the euro area. It did so at an earlier stage than in previous years, to take greater account of eurozone issues when approving the recommendations for the eurozone member states.

The recommendations were adopted at a meeting of the Economic and Financial Affairs Council. 

On 12 July 2016, the Council adopted new rules addressing some of the practices most commonly used by large companies to reduce their tax liability. 

The directive is part of a January 2016 package of Commission proposals to strengthen rules against corporate tax avoidance. The package builds on 2015 OECD recommendations to address tax base erosion and profit shifting (BEPS), endorsed by G20 leaders in November 2015. 

"This new directive aims to protect our domestic corporate tax bases against aggressive tax planning practices that directly affect the functioning of the internal market", said Peter Kažimír, minister for finance of Slovakia and president of the Council. "It is therefore an important step, which also demonstrates that we see the fight against such practices not only as our common priority but also our common commitment.“ 

The directive addresses situations where corporates, mostly multinational groups, take advantage of disparities between national tax systems in order to reduce their tax bills. It responds to the perception of many taxpayers and SMEs that some multinationals do not pay their fair share of tax, thereby distorting tax competition within the EU's single market.

New provisions in five areas 

The directive covers all taxpayers that are subject to corporate tax in a member states, including subsidiaries of companies based in third countries. It lays down anti-tax-avoidance rules for situations that may arise in five specific fields: 

• Interest limitation rules. Multinational groups may artificially shift their debt to jurisdictions with more generous deductibility rules. The directive sets out to discourage this practice by limiting the amount of interest that the taxpayer is entitled to deduct in a tax year.
• Exit taxation rules, to prevent tax base erosion in the state of origin. Corporate taxpayers may try to reduce their tax bills by moving their tax residence and/or assets, merely for aggressive tax planning purposes.
• General anti-abuse rule. This rule is intended to cover gaps that may exist in a country's specific anti-abuse rules, and thereby enable tax authorities to deny taxpayers the benefit of any abusive tax arrangements that may occur.
• Controlled foreign company (CFC) rules. In order to reduce their overall tax liability, corporate groups can shift large amounts of profits towards controlled subsidiaries in low-tax jurisdictions. CFC rules reattribute the income of a low-taxed controlled foreign subsidiary to its - usually more highly taxed - parent company.
• Rules on hybrid mismatches. Corporate taxpayers may take advantage of disparities between national tax systems in order to reduce their overall tax liability, for instance through double deductions. 

A common EU approach 

The directive will ensure that the OECD anti-BEPS measures are implemented in a coordinated manner in the EU, including by 6 member states that are not OECD members. 

Three of the five areas covered by the directive implement OECD recommendations, namely the interest limitation rules, the CFC rules and the rules on hybrid mismatches. The two others, i.e. the general anti-abuse rule and the exit taxation rules, deal with anti-tax-avoidance aspects of a 2011 proposal for an EU common consolidated corporate tax base. 

Implementation 

The directive was adopted without discussion at a meeting of the Economic and Financial Affairs Council. Political agreement was reached on 17 June 2016, following a silence procedure. 

The member states will have until 31 December 2018 to transpose it into their national laws and regulations, except for the exit taxation rules, for which they will have until 31 December 2019. Member states that have targeted rules that are equally effective to the interest limitation rules may apply them until the OECD reaches agreement on a minimum standard, or until 1 January 2024 at the latest. 

Other initiatives 

Work has proceeded meanwhile on the rest of the January 2016 anti-tax-avoidance package. On 25 May, the Council approved: 

• a directive on the exchange of tax-related information on multinational companies;
• conclusions on the third country aspects of tax transparency. 

The anti-tax-avoidance package follows on from a number of EU initiatives in 2015. These include a directive, adopted in December 2015, on cross-border tax rulings. 

In December 2014, the European Council cited “an urgent need to advance efforts in the fight against tax avoidance and aggressive tax planning, both at the global and EU levels”.

On 12 July 2016, the European Union and Monaco signed an agreement aimed at improving tax compliance by private savers. 

The agreement will contribute to efforts to clamp down on tax evasion, by requiring the EU member states and Monaco to exchange information automatically. 

This will allow their tax administrations improved cross-border access to information on the financial accounts of each other's residents. 

Upgrade 

The agreement upgrades a 2004 agreement that ensured that Monaco applied measures equivalent to those in an EU directive on the taxation of savings income. The aim is to extend the automatic exchange of information on financial accounts in order to prevent taxpayers from hiding capital representing income or assets for which tax has not been paid.

The text was signed in Brussels: 

• on behalf of the EU, by Peter Kažimír, minister for finance of Slovakia and president of the Council;
• on behalf of Monaco, by Serge Telle, minister of state.

 The signature took place in the presence of Pierre Moscovici, commissioner for economic and financial affairs, taxation and customs, who also signed the document. 

The Council adopted a decision on 12 July 2016 to authorise the signature on behalf of the EU. 

The EU and the OECD 

The agreement ensures that Monaco applies strengthened measures that are equivalent to measures in force in the EU. However, whereas the 2004 agreement was based on the EU's taxation savings directive, that directive has now been repealed. Directive 2003/48/EC was repealed in November 2015 in order to eliminate an overlap with directive 2014/107/EU, which includes strengthened provisions to prevent tax evasion. 

The agreement also complies with the automatic exchange of financial account information promoted by a 2014 OECD global standard. 

The EU signed similar agreements with Switzerland on 27 May 2015, Liechtenstein on 28 October 2015, San Marino on 8 December 2015 and Andorra on 12 February 2016. It approved the conclusion of the agreements with Switzerland and Liechtenstein on 8 December 2015 and San Marino on 16 April 2016. 

Coverage 

The agreement sets out to limit the opportunities for taxpayers to avoid being reported to the tax authorities by shifting assets. Information to be exchanged concerns not only income such as interest and dividends, but also account balances and proceeds from the sale of financial assets. 

Tax administrations in the member states and in Monaco will be able to: 

• identify correctly and unequivocally the taxpayers concerned;
• administer and enforce their tax laws in cross-border situations;
• assess the likelihood of tax evasion being perpetrated;
• avoid unnecessary further investigations.

 The EU and Monaco must now ratify or approve the agreement in time to enable its entry into force. The parties will strive to enable entry into force on 1 January 2017.