Swiss parliament probably will pass a bill allowing banks including Credit Suisse Group AG and Julius Baer Group Ltd. to resolve a tax-evasion dispute with the U.S., dropping opposition for fear of leaving the country’s 300 banks to a worse fate, according to academics including Peter V. Kunz of the University of Bern.
Members of the upper house’s economic committee will today start debating the law, which authorizes Swiss banks to cooperate with U.S. authorities. In a break with usual legislative procedure, it will be discussed by both chambers of parliament in the same session, which runs through June 21.
While the country’s two biggest parties -- the Social Democrats SP and the Swiss People’s Party SVP -- have already voiced skepticism over the proposal, the past has shown early opposition eventually dropped. In 2010 a law enabling UBS AG to hand over data on 4,450 accounts to the U.S. was approved after initially being rejected.
“It’s normal that everything is topsy turvy now, but as soon as the politicians reflect, they’ll give in, I’m optimistic,” said Kunz, a professor of business and comparative law at the University of Bern.
The upper house’s economics committee is expected to announce its decision on June 6, following discussions behind closed doors. The full upper house of parliament is scheduled to discuss and vote on it on June 12, with the plenary of the lower house giving its verdict on June 18, according to preliminary information given by Marie-Jose Portmann of the parliamentary services office.
Urgent Need
“If parliament doesn’t vote in favor of the agreement, Swiss banks would be in a significantly worse position for solving the tax dispute with the U.S.,” said Manuel Ammann, a professor of banking at the University of St. Gallen. “A no vote would lead to U.S. indictments. That would surely mean the end of several Swiss banks.”
Wegelin & Co., then the country’s oldest bank, closed its doors after it pleaded guilty in a Manhattan federal court in January to conspiring to help conceal more than $1.2 billion in assets from the Internal Revenue Service.
Patrick Raaflaub, chief executive officer of financial market supervisor Finma, on May 30 warned of the risks to banks, were parliament to fail to pass the measure.
The SVP and its allies hold a total of 62 seats in parliament, with the SP at 57, the Christian Democrats, or CVP, 44 and the Free Democrats 41. There are also smaller parties. The are 246 seats in total.