BETA


2018/2646(RSP) Resolution on the adverse effects of the US Foreign Account Tax Compliance Act (FATCA) on EU citizens and in particular 'accidental Americans'

Progress: Procedure completed

RoleCommitteeRapporteurShadows
Lead PETI WIKSTRÖM Cecilia (icon: ALDE ALDE)
Lead committee dossier:
Legal Basis:
RoP 136-p5

Events

2018/11/16
   EC - Commission response to text adopted in plenary
Documents
2018/07/05
   EP - Results of vote in Parliament
2018/07/05
   EP - Decision by Parliament, 1st reading/single reading
Details

The European Parliament adopted by 470 votes to 43 with 26 abstentions a resolution tabled by the Committee on Petitions on the adverse effects of the US Foreign Account Tax Compliance Act (FATCA) on EU citizens and in particular ‘accidental Americans’. It noted that its Committee on Petitions was seized with a petition from a collective of European citizens raising concerns about the adverse effects of FATCA, its implementing intergovernmental agreements (IGAs) and the extraterritorial impact of citizenship-based taxation (CBT).

Members recalled that since the entry into force of FATCA and the related IGAs concluded between Member States and the US, EU financial institutions, under the threat of a 30 % withholding tax, now have to disclose detailed information on accounts held by presumed ‘US persons’ to the US Internal Revenue Service (IRS). FATCA aims to prevent tax evasion by ‘US persons’ and requires foreign financial institutions to search for ‘US persons’ by looking at a variety of indicators, such as birthplace in the US, or a US telephone number. Parliament noted that this use of indicators, enforced by FATCA, might result in the arbitrary exposure and punishment of individuals who might, in reality, have no substantive ties to the US . This includes the ‘accidental Americans’ who, by accident of birth, inherited US citizenship, but who maintain no ties to the US, having never lived, worked or studied in the US and who do not hold US social security numbers. Members referred to the fact that those persons falling within the definition of ‘US persons’ have their savings accounts frozen and are denied access to all banking services , including life insurance, pensions and mortgages, due to the reluctance of financial institutions to follow costly FATCA reporting. In addition, their EU family members are seeing their personal data shared with the US and their access to EU banking services curtailed (e.g. joint accounts and/or mortgages).

Parliament noted that ‘accidental Americans’ who do not want to be affected by FATCA are obliged to formally renounce their US citizenship, which is a very cumbersome process for which a US social security number or a US international tax identification number is required which, inter alia, most ‘accidental Americans’ do not possess.

Under these circumstances, Parliament made the following points:

Payments Accounts Directive : recalling that Directive 2014/92/EU (Payment Accounts Directive) obliges Member States to ensure that credit institutions do not discriminate against consumers on the basis of their nationality or place of residence, Parliament called for the full and correct transposition of the Directive, and stressed the right for all EU citizens to have access to a payment account with basic features, irrespective of their nationality. The Commission was asked to:

expedite its analysis of national transposition measures of the Payment Accounts Directive (the deadline for transposition was 18 September 2016) and to include in its assessment the situation of ‘accidental Americans’, dual citizens and US citizens legally resident in the EU, paying due attention to any discrimination by financial institutions against taxpayers legally residing in the EU and qualifying as ‘US persons’ for the purpose of FATCA; initiate infringement procedures in the event of established breaches in the implementation of the Payment Accounts Directive, and to report back to Parliament and the Council.

Data protection : Parliament noted that American internet platforms such as AirBnB, Tripadvisor and Amazon are required to collect taxpayer information from all EU citizens who make use of these online services, and hand it over to the US federal tax authority, the IRS so that the latter might establish whether the user is a US citizen and, therefore, to determine if the earnings made through these platforms are subject, in the context of FATCA, to US tax reporting. It stated that this practice is clearly not in line with EU data protection rules . Stressing the need to provide an adequate level of protection for personal data transferred to the US under FATCA, Parliament called on the Commission to:

conduct a full assessment of the impact of FATCA and the US extraterritorial practice of citizenship-based taxation on EU citizens, and to explain if a serious discrepancy exists between EU citizens and/or residents in different Member States, especially as regards EU data protection rules and fundamental rights standards as a result of FATCA and ‘US indicia’; conduct a comprehensive assessment of the status of FATCA reciprocity , or the lack thereof, across the EU, and compliance by the US with its obligations under the various IGAs signed with Member States ; investigate any infringement of EU data protection rules by Member States whose legislation authorises the transfer of personal data to the US IRS for the purposes of FATCA, and to initiate infringement procedures against Member States that fail to adequately enforce EU data protection rules; take action to ensure that the EU fundamental rights and values enshrined in the Charter of Fundamental Rights and the European Convention on Human Rights, such as the right to privacy and the principle of non-discrimination, as well as EU data protection rules, are respected in the context of FATCA and the automatic exchange of tax information with the US.

IGAs: Parliament regretted the inherent lack of reciprocity of IGAs signed by Member States, especially in terms of the scope of information to be exchanged, which is broader for Member States than it is for the US. It asked all Member States to collectively suspend the application of their IGAs until such time as the US agrees to a multilateral approach to the automatic exchange of information (AEOI), by either repealing FATCA and joining the OECD Common Reporting Standard (CRS) or renegotiating FATCA on an EU‑wide basis and with identical reciprocal sharing obligations on both sides of the Atlantic.

Lastly, the resolution called on the Council to mandate the Commission to open negotiations with the US on an EU-US FATCA agreement, with a view to ensuring the full reciprocal exchange of information, upholding the fundamental principles of EU law, as well as the Payment Accounts Directive, and allowing EU ‘accidental Americans’ to relinquish their unwanted US citizenship on a no‑fees, no‑filings, no‑penalties basis.

Documents
2018/07/05
   EP - End of procedure in Parliament
2018/07/04
   EP - Motion for a resolution
Documents
2018/07/04
   EP - Debate in Parliament
2018/07/02
   EP - Oral question/interpellation by Parliament
Documents
2018/07/02
   EP - Oral question/interpellation by Parliament
Documents
2018/05/25
   EP - Amendments tabled in committee
Documents
2018/02/22
   EP - WIKSTRÖM Cecilia (ALDE) appointed as rapporteur in PETI

Documents

  • Commission response to text adopted in plenary: SP(2018)628
  • Results of vote in Parliament: Results of vote in Parliament
  • Decision by Parliament, 1st reading/single reading: T8-0316/2018
  • Motion for a resolution: B8-0306/2018
  • Debate in Parliament: Debate in Parliament
  • Oral question/interpellation by Parliament: B8-0032/2018
  • Oral question/interpellation by Parliament: B8-0033/2018
  • Amendments tabled in committee: PE622.251
  • Amendments tabled in committee: PE622.251
  • Oral question/interpellation by Parliament: B8-0032/2018
  • Oral question/interpellation by Parliament: B8-0033/2018
  • Motion for a resolution: B8-0306/2018
  • Commission response to text adopted in plenary: SP(2018)628

Activities

Votes

B8-0306/2018 - Résolution 05/07/2018 12:44:41.000

2018/07/05 Outcome: +: 470, -: 43, 0: 26
DE FR IT ES RO BE PT AT CZ HU BG NL DK SE IE HR FI SK SI LT GB LV EE EL LU MT CY PL
Total
77
63
50
31
25
19
18
16
16
13
13
19
11
11
9
10
11
11
6
7
43
7
5
5
4
3
1
34
icon: S&D S&D
144

Czechia S&D

2

Netherlands S&D

2

Ireland S&D

For (1)

1

Croatia S&D

2

Slovakia S&D

2

Lithuania S&D

1

Latvia S&D

1

Estonia S&D

For (1)

1

Greece S&D

2

Luxembourg S&D

For (1)

1

Malta S&D

2

Cyprus S&D

1
icon: PPE PPE
146

Sweden PPE

For (1)

1

Ireland PPE

3

Finland PPE

2

Lithuania PPE

1

United Kingdom PPE

1

Estonia PPE

For (1)

1

Luxembourg PPE

2

Malta PPE

1
icon: ALDE ALDE
55
3

Romania ALDE

For (1)

1

Portugal ALDE

1

Sweden ALDE

2

Ireland ALDE

For (1)

1

Croatia ALDE

For (1)

1

Finland ALDE

Abstain (1)

3

Slovenia ALDE

For (1)

1

United Kingdom ALDE

1

Latvia ALDE

1

Estonia ALDE

2
icon: Verts/ALE Verts/ALE
37

Belgium Verts/ALE

2

Austria Verts/ALE

3

Hungary Verts/ALE

2

Netherlands Verts/ALE

For (1)

1

Denmark Verts/ALE

For (1)

1

Sweden Verts/ALE

For (1)

1

Croatia Verts/ALE

For (1)

1

Finland Verts/ALE

For (1)

1

Lithuania Verts/ALE

For (1)

1

United Kingdom Verts/ALE

3

Latvia Verts/ALE

1

Estonia Verts/ALE

For (1)

1

Luxembourg Verts/ALE

For (1)

1
icon: GUE/NGL GUE/NGL
34

Italy GUE/NGL

1

Czechia GUE/NGL

1

Netherlands GUE/NGL

2

Denmark GUE/NGL

For (1)

1

Sweden GUE/NGL

For (1)

1

Finland GUE/NGL

For (1)

1

United Kingdom GUE/NGL

1

Greece GUE/NGL

1
icon: ENF ENF
30

Germany ENF

Against (1)

1

Belgium ENF

Abstain (1)

1

Netherlands ENF

4

Poland ENF

2
icon: EFDD EFDD
30

Germany EFDD

For (1)

1

Czechia EFDD

Against (1)

1
icon: ECR ECR
50

Romania ECR

2

Czechia ECR

Abstain (1)

1

Bulgaria ECR

Abstain (1)

1

Netherlands ECR

For (1)

1

Sweden ECR

2

Croatia ECR

Abstain (1)

1

Finland ECR

2

Lithuania ECR

Against (1)

1

Latvia ECR

Against (1)

1
icon: NI NI
12

Germany NI

2

France NI

For (1)

1

Hungary NI

For (1)

1

United Kingdom NI

3

Greece NI

Abstain (1)

2
AmendmentsDossier
19 2018/2646(RSP)
2018/05/25 PETI 19 amendments...
source: 622.251

History

(these mark the time of scraping, not the official date of the change)

docs/3/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=MOTION&reference=B8-2018-0306&language=EN
New
http://www.europarl.europa.eu/doceo/document/B-8-2018-0306_EN.html
docs/4/body
EC
events/2/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P8-TA-2018-0316
New
http://www.europarl.europa.eu/doceo/document/TA-8-2018-0316_EN.html
committees/0
type
Responsible Committee
body
EP
committee_full
Petitions
committee
PETI
associated
False
rapporteur
name: WIKSTRÖM Cecilia date: 2018-02-22T00:00:00 group: Alliance of Liberals and Democrats for Europe abbr: ALDE
committees/0
type
Responsible Committee
body
EP
committee_full
Petitions
committee
PETI
associated
False
date
2018-02-22T00:00:00
rapporteur
name: WIKSTRÖM Cecilia group: Alliance of Liberals and Democrats for Europe abbr: ALDE
activities
  • date: 2018-07-04T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20180704&type=CRE type: Debate in Parliament title: Debate in Parliament body: EP type: Debate in Parliament
  • date: 2018-07-05T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P8-TA-2018-0316 type: Decision by Parliament, 1st reading/single reading title: T8-0316/2018 body: EP type: Decision by Parliament, 1st reading/single reading
commission
  • body: EC dg: Taxation and Customs Union commissioner: MOSCOVICI Pierre
committees/0
type
Responsible Committee
body
EP
committee_full
Petitions
committee
PETI
associated
False
date
2018-02-22T00:00:00
rapporteur
name: WIKSTRÖM Cecilia group: Alliance of Liberals and Democrats for Europe abbr: ALDE
committees/0
body
EP
responsible
True
committee
PETI
date
2018-02-22T00:00:00
committee_full
Petitions
rapporteur
group: ALDE name: WIKSTRÖM Cecilia
docs
  • date: 2018-05-25T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE622.251 title: PE622.251 type: Amendments tabled in committee body: EP
  • date: 2018-07-02T00:00:00 docs: title: B8-0032/2018 type: Oral question/interpellation by Parliament body: EP
  • date: 2018-07-02T00:00:00 docs: title: B8-0033/2018 type: Oral question/interpellation by Parliament body: EP
  • date: 2018-07-04T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=MOTION&reference=B8-2018-0306&language=EN title: B8-0306/2018 type: Motion for a resolution body: EP
  • date: 2018-11-16T00:00:00 docs: url: /oeil/spdoc.do?i=31387&j=0&l=en title: SP(2018)628 type: Commission response to text adopted in plenary
events
  • date: 2018-07-04T00:00:00 type: Debate in Parliament body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20180704&type=CRE title: Debate in Parliament
  • date: 2018-07-05T00:00:00 type: Results of vote in Parliament body: EP docs: url: https://oeil.secure.europarl.europa.eu/oeil/popups/sda.do?id=31387&l=en title: Results of vote in Parliament
  • date: 2018-07-05T00:00:00 type: Decision by Parliament, 1st reading/single reading body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P8-TA-2018-0316 title: T8-0316/2018 summary: The European Parliament adopted by 470 votes to 43 with 26 abstentions a resolution tabled by the Committee on Petitions on the adverse effects of the US Foreign Account Tax Compliance Act (FATCA) on EU citizens and in particular ‘accidental Americans’. It noted that its Committee on Petitions was seized with a petition from a collective of European citizens raising concerns about the adverse effects of FATCA, its implementing intergovernmental agreements (IGAs) and the extraterritorial impact of citizenship-based taxation (CBT). Members recalled that since the entry into force of FATCA and the related IGAs concluded between Member States and the US, EU financial institutions, under the threat of a 30 % withholding tax, now have to disclose detailed information on accounts held by presumed ‘US persons’ to the US Internal Revenue Service (IRS). FATCA aims to prevent tax evasion by ‘US persons’ and requires foreign financial institutions to search for ‘US persons’ by looking at a variety of indicators, such as birthplace in the US, or a US telephone number. Parliament noted that this use of indicators, enforced by FATCA, might result in the arbitrary exposure and punishment of individuals who might, in reality, have no substantive ties to the US . This includes the ‘accidental Americans’ who, by accident of birth, inherited US citizenship, but who maintain no ties to the US, having never lived, worked or studied in the US and who do not hold US social security numbers. Members referred to the fact that those persons falling within the definition of ‘US persons’ have their savings accounts frozen and are denied access to all banking services , including life insurance, pensions and mortgages, due to the reluctance of financial institutions to follow costly FATCA reporting. In addition, their EU family members are seeing their personal data shared with the US and their access to EU banking services curtailed (e.g. joint accounts and/or mortgages). Parliament noted that ‘accidental Americans’ who do not want to be affected by FATCA are obliged to formally renounce their US citizenship, which is a very cumbersome process for which a US social security number or a US international tax identification number is required which, inter alia, most ‘accidental Americans’ do not possess. Under these circumstances, Parliament made the following points: Payments Accounts Directive : recalling that Directive 2014/92/EU (Payment Accounts Directive) obliges Member States to ensure that credit institutions do not discriminate against consumers on the basis of their nationality or place of residence, Parliament called for the full and correct transposition of the Directive, and stressed the right for all EU citizens to have access to a payment account with basic features, irrespective of their nationality. The Commission was asked to: expedite its analysis of national transposition measures of the Payment Accounts Directive (the deadline for transposition was 18 September 2016) and to include in its assessment the situation of ‘accidental Americans’, dual citizens and US citizens legally resident in the EU, paying due attention to any discrimination by financial institutions against taxpayers legally residing in the EU and qualifying as ‘US persons’ for the purpose of FATCA; initiate infringement procedures in the event of established breaches in the implementation of the Payment Accounts Directive, and to report back to Parliament and the Council. Data protection : Parliament noted that American internet platforms such as AirBnB, Tripadvisor and Amazon are required to collect taxpayer information from all EU citizens who make use of these online services, and hand it over to the US federal tax authority, the IRS so that the latter might establish whether the user is a US citizen and, therefore, to determine if the earnings made through these platforms are subject, in the context of FATCA, to US tax reporting. It stated that this practice is clearly not in line with EU data protection rules . Stressing the need to provide an adequate level of protection for personal data transferred to the US under FATCA, Parliament called on the Commission to: conduct a full assessment of the impact of FATCA and the US extraterritorial practice of citizenship-based taxation on EU citizens, and to explain if a serious discrepancy exists between EU citizens and/or residents in different Member States, especially as regards EU data protection rules and fundamental rights standards as a result of FATCA and ‘US indicia’; conduct a comprehensive assessment of the status of FATCA reciprocity , or the lack thereof, across the EU, and compliance by the US with its obligations under the various IGAs signed with Member States ; investigate any infringement of EU data protection rules by Member States whose legislation authorises the transfer of personal data to the US IRS for the purposes of FATCA, and to initiate infringement procedures against Member States that fail to adequately enforce EU data protection rules; take action to ensure that the EU fundamental rights and values enshrined in the Charter of Fundamental Rights and the European Convention on Human Rights, such as the right to privacy and the principle of non-discrimination, as well as EU data protection rules, are respected in the context of FATCA and the automatic exchange of tax information with the US. IGAs: Parliament regretted the inherent lack of reciprocity of IGAs signed by Member States, especially in terms of the scope of information to be exchanged, which is broader for Member States than it is for the US. It asked all Member States to collectively suspend the application of their IGAs until such time as the US agrees to a multilateral approach to the automatic exchange of information (AEOI), by either repealing FATCA and joining the OECD Common Reporting Standard (CRS) or renegotiating FATCA on an EU‑wide basis and with identical reciprocal sharing obligations on both sides of the Atlantic. Lastly, the resolution called on the Council to mandate the Commission to open negotiations with the US on an EU-US FATCA agreement, with a view to ensuring the full reciprocal exchange of information, upholding the fundamental principles of EU law, as well as the Payment Accounts Directive, and allowing EU ‘accidental Americans’ to relinquish their unwanted US citizenship on a no‑fees, no‑filings, no‑penalties basis.
  • date: 2018-07-05T00:00:00 type: End of procedure in Parliament body: EP
links
other
  • body: EC dg: url: http://ec.europa.eu/info/departments/taxation-and-customs-union_en title: Taxation and Customs Union commissioner: MOSCOVICI Pierre
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PETI/8/12544
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Rules of Procedure EP 136-p5
procedure/legal_basis/0
Rules of Procedure EP 128-p5
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  • 1.20.09 Protection of privacy and data protection
  • 2.50.04 Banks and credit
New
1.20.09
Protection of privacy and data protection
2.50.04
Banks and credit
activities/0/docs
  • url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20180704&type=CRE type: Debate in Parliament title: Debate in Parliament
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Adverse effects of FATCA on EU citizens and in particular 'accidental Americans'
New
Resolution on the adverse effects of the US Foreign Account Tax Compliance Act (FATCA) on EU citizens and in particular 'accidental Americans'
activities
  • date: 2018-07-04T00:00:00 body: EP type: Debate in plenary scheduled
  • date: 2018-07-05T00:00:00 body: EP type: Vote in plenary scheduled
committees
  • body: EP responsible: True committee: PETI date: 2018-02-22T00:00:00 committee_full: Petitions rapporteur: group: ALDE name: WIKSTRÖM Cecilia
links
other
  • body: EC dg: url: http://ec.europa.eu/info/departments/taxation-and-customs-union_en title: Taxation and Customs Union commissioner: MOSCOVICI Pierre
procedure
dossier_of_the_committee
PETI/8/12544
geographical_area
United States
reference
2018/2646(RSP)
title
Adverse effects of FATCA on EU citizens and in particular 'accidental Americans'
legal_basis
Rules of Procedure EP 128-p5
stage_reached
Awaiting Parliament 1st reading / single reading / budget 1st stage
subtype
Debate or resolution on oral question/interpellation
type
RSP - Resolutions on topical subjects
subject