Switzerland’s cloaking practices as a tax haven are well known, but there appear to be a couple of practices that the OECD still finds anathema to an open and transparent business environment. Both practices in themselves may not be considered as illegal, but could in practice be used to cloak activities with a nefarious purpose.
One is the practice of issuing bearer shares that bestow upon the shareholder all rights and responsibilities without disclosing the identity of the holder. In this way a company may issue stock either in part or full, where the actual identity of the ownwer is not known. The Global Forum on Transparency and Exchange of Information for Tax Purposes has noted that the compnay ownership remains cloaked, in many instances.
The OECD has also asked for checks to be put into place for companies that have their registered offices elsewhere, but actually operate from Switzerland.
It has been a long and hard drive in opening up Swiss banking privacy laws, but it appears that there is no choice for Switzerland, but to make it easy for tax authorities worldwide to access bank account information of persons without having to take recourse to listing all details of the person. This hitherto insurmountable barrier that had prevented tax authorities elsewhere in pursuing tax offenders will be cleared. The OECD is not letting the Swiss government off the hook and shall be auditing the progress in the implementation of transparency laws next year. Switzerland has a difficult ski season ahead.