French support for registers of trusts

One year after the events of the London G-20, at which world leaders signed up to an agenda of tackling the tax havens, French newspaper La Tribune carries an interview with François d'Aubert, special adviser to President Sarkozy, in which he re-iterates the case for a country-by-country reporting standard for multinational companies and supports the creation of national registers of trusts.

Trusts are the black hole of global information exchange processes. Under existing treaty arrangements tax haven authorities are required to share information in their possession: the problem lies with the fact that they don't collect information about trusts and therefore have no information to share. The solution, says M d'Aubert, lies with requiring registration of trusts and sharing information about who creates the trusts (the settlor) and who benefits (the beneficiaries). TJN agrees, and we also suggest that trustees, who are often lawyers working in tax havens, should have legal responsibility in their capacity as paying agents for providing information about payments made to beneficiaries of the trust to the national authorities of the countries where those beneficiaries are resident for tax purposes.

We have no objection to the principle of trusts: these are useful instruments that can and do serve a variety of legitimate purposes. But there is no reason why trusts should not be required to furnish a minimum amount of information for tax information exchange purposes. This is an area where G-20 can and must take action.