Global Forum on Transparency and Exchange of Information for Tax Purposes Peer Reviews: Belgium 2011 by OECD

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The Global Forum on Transparency and Exchange of Information for Tax Purposes is the multilateral framework within which work in the area of tax transparency and exchange of information is carried out by over 90 jurisdictions which participate in the work of the Global Forum on an equal footing.
The Global Forum is charged with in-depth monitoring and peer review of the implementation of the standards of transparency and exchange of information for tax purposes.  These standards are primarily reflected in the 2002 OECD Model Agreement on Exchange of Information on Tax Matters and its commentary, and in Article 26 of the OECD Model Tax Convention on Income and on Capital and its commentary as updated in 2004, which has been incorporated in the UN Model Tax Convention. 
The standards provide for international exchange on request of foreseeably relevant information for the administration or enforcement of the domestic tax laws of a requesting party. “Fishing expeditions” are not authorised, but all foreseeably relevant information must be provided, including bank information and information held by fiduciaries, regardless of the existence of a domestic tax interest or the application of a dual criminality standard.
All members of the Global Forum, as well as jurisdictions identified by the Global Forum as relevant to its work, are being reviewed. This process is undertaken in two phases. Phase 1 reviews assess the quality of a jurisdiction’s legal and regulatory framework for the exchange of information, while Phase 2 reviews look at the practical implementation of that framework.  Some Global Forum members are undergoing combined – Phase 1 plus Phase 2 – reviews. The ultimate goal is to help jurisdictions to effectively implement the international standards of transparency and exchange of information for tax purposes.
All review reports are published once approved by the Global Forum and they thus represent agreed G

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									GLOBAL FORUM ON TRANSPARENCY AND EXCHANGE
OF INFORMATION FOR TAX PURPOSES



Peer Review Report
Phase 1
Legal and Regulatory Framework

BELGIUM
      Global Forum
    on Transparency
      and Exchange
 of Information for Tax
Purposes Peer Reviews:
      Belgium 2011
                    PHASE 1



                      April 2011
  (reflecting the legal and regulatory framework
                 as at October 2010)
This work is published on the responsibility of the Secretary-General of the OECD.
The opinions expressed and arguments employed herein do not necessarily reflect
the official views of the OECD or of the governments of its member countries or
those of the Global Forum on Transparency and Exchange of Information for Tax
Purposes.


  Please cite this publication as:
  OECD (2011), Global Forum on Transparency and Exchange of Information for Tax Purposes Peer
  Reviews: Belgium 2011: Phase 1, OECD Publishing.
  http://dx.doi.org/10.1787/9789264108738-en



ISBN 978-92-64-10830-1 (print)
ISBN 978-92-64-10873-8 (PDF)



Series: Global Forum on Transparency and Exchange of Information for Tax Purposes: Peer Reviews
ISSN 2219-4681 (print)
ISSN 2219-469X (online)




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                                                                                                 TABLE OF CONTENTS – 3




                                            Table of Contents

About the Global Forum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
   Information and methodology used for the Peer Review of Belgium . . . . . . . . . .11
   Overview of Belgium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
   General information on the legal and tax system . . . . . . . . . . . . . . . . . . . . . . . . 12
   Overview of the financial sector and the relevant professions . . . . . . . . . . . . . . .14
   Recent developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Compliance with the Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

A. Availability of Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
   Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
   A.1. Ownership and identity information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
   A.2. Accounting records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
   A.3. Banking information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
B. Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
   Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
   B.1. Competent Authority’s ability to obtain and provide information . . . . . . . . 42
   B.2. Notification requirements and rights and safeguards. . . . . . . . . . . . . . . . . . 49
C. Exchanging Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
   Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   51
   C.1. Information exchange mechanisms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      52
   C.2. Exchange-of-information mechanisms with all relevant partners . . . . . . . .                                       57
   C.3. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       59
   C.4. Rights and safeguards of taxpayers and third parties. . . . . . . . . . . . . . . . . .                             60
   C.5. Timeliness of responses to requests for information . . . . . . . . . . . . . . . . . .                             61



PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
4 – TABLE OF CONTENTS

Summary of Determinations and Factors Underlying Recommendations. . . . 63

Annex 1: The Jurisdiction’s Response to the Peer Review. . . . . . . . . . . . . . . . . 65
Annex 2: List of all Information Exchange Mechanisms in Force . . . . . . . . . . 67
Annex 3: List of all Information Exchange Mechanisms to the Standard
         Signed by Belgium since its Commitment. . . . . . . . . . . . . . . . . . . . . . 71
Annex 4: List of all Laws, Regulations and Other Documents Received . . . . . 73




                    PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                          ABOUT THE GLOBAL FORUM – 5




                             About the Global Forum

           The Global Forum on Transparency and Exchange of Information for Tax
       Purposes is the multilateral framework within which work in the area of tax
       transparency and exchange of information is carried out by over 90 jurisdic-
       tions, which participate in the Global Forum on an equal footing.
            The Global Forum is charged with in-depth monitoring and peer review of
       the implementation of the international standards of transparency and exchange
       of information for tax purposes. These standards are primarily reflected in the
       2002 OECD Model Agreement on Exchange of Information on Tax Matters
       and its commentary, and in Article 26 of the OECD Model Tax Convention on
       Income and on Capital and its commentary as updated in 2004. The standards
       have also been incorporated into the UN Model Tax Convention.
            The standards provide for international exchange on request of foresee-
       ably relevant information for the administration or enforcement of the domes-
       tic tax laws of a requesting party. Fishing expeditions are not authorised but
       all foreseeably relevant information must be provided, including bank infor-
       mation and information held by fiduciaries, regardless of the existence of a
       domestic tax interest.
           All members of the Global Forum, as well as jurisdictions identified by
       the Global Forum as relevant to its work, are being reviewed. This process is
       undertaken in two phases. Phase 1 reviews assess the quality of a jurisdiction’s
       legal and regulatory framework for the exchange of information, while Phase 2
       reviews look at the practical implementation of that framework. Some Global
       Forum members are undergoing combined – Phase 1 and Phase 2 – reviews.
       The ultimate goal is to help jurisdictions to effectively implement the interna-
       tional standards of transparency and exchange of information for tax purposes.
            All review reports are published once adopted by the Global Forum.
           For more information on the work of the Global Forum on Transparency
       and Exchange of Information for Tax Purposes, and for copies of the pub-
       lished review reports, please refer to www.oecd.org/tax/transparency.




PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                               EXECUTIVE SUMMARY – 7




                                 Executive Summary

       1.        The present report summarises Belgium’s legal and regulatory
       framework for transparency and exchange of information for tax purposes.
       The international standard laid down in the terms of reference of the Global
       Forum for monitoring and reviewing progress towards transparency and
       exchange of information, considers the availability of relevant information
       within a given jurisdiction, the ability of the competent authority to access it
       swiftly, and whether the information may be exchanged effectively with its
       partners in information exchange.
       2.       Since its commitment to the international standard of transparency
       in March 2009, Belgium has embarked on a far-reaching drive to renegotiate
       its tax conventions, so that it now has signed 41 information exchange mecha-
       nisms that comply with the standard, while 24 other protocols complying with
       the standard have been initialled. That said, given Belgian domestic legislation
       that does not allow access to banking information for the purposes of assess-
       ing income taxes to be paid by bank clients, only a single treaty providing for
       the exchange of all types of information, including banking information, is in
       force at this time.1 Belgium has not yet ratified all of its negotiated agreements
       due to an exceptional political situation. This is the major shortcoming in the
       country’s legal and regulatory framework in the area of information exchange,
       and Belgium is invited to ratify these agreements as soon as possible.
       3.      Belgium is, however, in a position to exchange all other types of infor-
       mation for the purposes of assessing income taxes with 112 jurisdictions on
       the basis of 99 tax treaties and 13 information exchange agreements. Belgium
       is also party to the EU Council Directive concerning mutual assistance by
       the competent authorities of the Member States in the field of direct taxation
       and taxation of insurance premiums, as well as to the joint OECD/Council
       of Europe Convention on Mutual Administrative Assistance in Tax Matters.
       Belgium has committed itself to signing the protocol amending this convention.


1.     It must be noted that Belgium under the terms of the EU Savings Directive
       2003/48/EC, exchange automatically bank information with 33 jurisdiction from
       1 January 2010.


PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
8 – EXECUTIVE SUMMARY

     4.       Given the registration requirements for companies as well as tax
     requirements, the availability of information regarding ownership of com-
     panies and partnerships is very generally ensured in Belgium. Generally, the
     identity of shareholders in public limited companies and partnerships limited
     by shares is known. The 14 December 2005 law eliminated bearer shares
     and established mechanisms which aim, on the one hand, to remove the pos-
     sibility of issuing such shares and on the other, to transform these shares into
     registered or electronic shares whereby the identity of the holder is known.
     The conversion of bearer shares of listed companies was accomplished by
     1 January 2008. For other companies, this conversion will be completed by
     31 December 2013. In the meantime, the Belgian authorities must seek ways
     of reinforcing the mechanisms which encourage holders of bearer shares to
     opt as soon as possible for the system of registered or electronic securities.
     5.       Belgian legislation ensures the availability of accounting information.
     In effect, the legal obligations apply to entities subject to corporate income
     tax or legal entities income tax2 as well as all other entities whose purpose
     is commercial. While information held by banks or financial institutions is
     available given the anti money-laundering legislation, Belgian domestic law
     authorizes access to this information in a number of fiscal areas3 but not for
     the purposes of assessing income taxes owed by banks customers.
     6.       In fact, the Belgian Income Tax Code (CIR 92) states that the tax
     authorities cannot, for the purpose of assessing income tax, access banking
     information held by banks concerning their customers. In this situation, only
     a tax treaty with provisions equivalent to article 26(5) of the OECD Model
     Convention empowers the Belgian authorities to ask financial institutions to
     provide them with this information4.The provisions of the implementing leg-
     islation for the Belgian/US tax convention, the only treaty in force that allows
     for the exchange of this kind of information, state that banking secrecy does
     not apply. It is now up to the Belgian authorities to ensure that similar provi-
     sions will be enacted for each of the 40 treaties signed to date.
     7.      Apart from banking information, the Belgian administration has
     access to all types of information and is in a position to use its domestic
     information-gathering powers for the exchange of information. The Belgian

2.   A legal entity not subject to corporate income tax is subject to an income tax
     called “legal entities income tax” (in the case of foundations for instance).
3.   In matters of VAT, tax collection, assessment of inheritance tax, and, for example,
     automatic exchange of information in the context of the Savings Directive.
4.   On condition the EOI provision is backed up with appropriate implementation
     provisions stating that notwithstanding the domestic tax legislation, Belgian
     authorities can access banking information to respond to EOI requests made by
     a treaty partner.


                    PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                               EXECUTIVE SUMMARY – 9



       authorities have access to this information within the three-year time limit on
       tax assessment in Belgium. Access to information during a seven-year period
       must be justified to the Belgian taxpayer concerned by the request. In the
       international exchange of information, Belgium interprets this legislation as
       allowing it to access information during the seven-year period if the requesting
       party provides reasons to justify access for a period greater than three years.
       Tax avoidance is sufficient to justify an access to information for a seven year
       period. As this is a matter of interpretation and administrative practice, it
       should be given additional scrutiny during the phase 2 peer review.
       8.      Finally, given the lack of provisions in domestic legislation under
       which banking information can be accessed for purposes of international
       information exchange, Belgium should ensure that its treaty ratification pro-
       cedures are carried out as soon as possible.
       9.       Belgium’s response to the conclusions and recommendations of the
       present report, as well as its practical implementation of this legal framework,
       will be assessed during the Phase 2 peer review scheduled for the second half
       of 2012 provided that Belgium ratifies a significant number of the treaties that
       comply with the standard.




PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                                     INTRODUCTION – 11




                                        Introduction


Information and methodology used for the Peer Review of Belgium

       10.      The assessment of the legal and regulatory framework of Belgium
       was based on the international standards for transparency and exchange of
       information as described in the Global Forum’s Terms of Reference and was
       prepared using the Global Forum’s Methodology for Peer and Non-Member
       Reviews. The assessment was based on the laws, regulations and information
       exchange mechanisms in force or effect at the end of October 2010, other
       material provided by Belgium and on information provided by partners of this
       jurisdiction.
       11.       The Terms of Reference break down the standards of transparency
       and exchange of information into 10 essential elements and 31 enumerated
       aspects under three broad categories: (A) availability of information; (B)
       access to information; and (C) exchanging information. This review assesses
       Belgium’s legal and regulatory framework against these elements and each of
       the enumerated aspects. In respect of each essential element a determination
       is made that either (i) the element is in place, (ii) the element is in place but
       certain aspects of the legal implementation of the element need improvement,
       or (iii) the element is not in place. These determinations are accompanied by
       recommendations as to how some aspects of the Belgian system might be
       strengthened.
       12.      The assessment was conducted by a team consisting of two asses-
       sors and a representative of the Global Forum Secretariat: Shauna Pittman,
       Counsel, Canada Revenue Agency; Rajesh Sharma Ramloll Assistant
       Solicitor General at the Attorney General’s Office in Mauritius; and Rémi
       Verneau for the Global Forum Secretariat. The team evaluated Belgium’s
       legal and regulatory framework for transparency and exchange of information
       and its relevant information exchange mechanisms.




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12 – INTRODUCTION

Overview of Belgium

      13.     A small state in Western Europe in terms of its area (30 000 km²),
      Belgium has a total population of 10.7 million, making it one of the most
      densely populated European states with 350 inhabitants/km². Directly facing
      the North Sea, Belgium shares common borders with France, Luxemburg,
      Germany and the Netherlands.
      14.     Belgium is a highly developed country, in particular because of its
      maritime access and EU membership. In spite of its size, it was the 20th global
      economy in 2009 with a GDP of EUR 345 billion and a per capita GDP of
      EUR 32 000 in 2008. The Belgian economy is mainly centred on the services
      industry which employs 75% of the working population. Industry accounts for
      almost a quarter of all jobs, and agriculture less than 1%. Exports and imports
      account for 80% of the Belgian GDP. Belgium’s main economic partners are
      Germany, France, the Netherlands, the United Kingdom and the United States.
      15.      Belgium is a founding member of the EU and the Economic and
      Monetary Union of countries forming the euro area. Its capital, Brussels, is
      also the headquarters of the European Commission and most EU administra-
      tive authorities. In addition, Belgium is a founding member of the OECD and
      the UN, as well as NATO, which is headquartered in Brussels. It is also a
      member of other international organisations such as the IMF and the WTO.
      As a member of the OECD, Belgium takes part in the Global Forum.

General information on the legal and tax system


      Legal system
      16.     Belgium (or the Kingdom of Belgium) is a constitutional parliamen-
      tary monarchy. Since 1994, it has been a federal state consisting of three
      Regions (the Brussels Capital Region, the Flemish Region and the Walloon
      Region) and three Communities (Flemish, French and German-speaking).
      The regions are divided into 10 provinces and 589 municipalities. The official
      languages are Dutch, French and German.
      17.       At the federal level, the legislature consists of the Chamber of
      Representatives and the Senate, both elected for four years. The executive con-
      sists of the King as Head of State and the government led by the prime minister.
      The executive runs those aspects of the country which are the responsibility of
      the federal government under the Constitution. This applies to matters in the
      financial sphere.
      18.    The Belgian legal system is rooted in Roman and Germanic law
      known as civil law. At the federal level, the 1994 Constitution constitutes the


                    PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                                     INTRODUCTION – 13



       pinnacle of the hierarchy of norms. While the Belgian Constitution does not
       refer to the position of international treaties in this hierarchy, the primacy of
       international law over domestic law has been confirmed by the case law of
       the Belgian Supreme Court of Appeal in so far as the international standard is
       likely to have a direct impact, or in other words to be sufficiently clear, com-
       prehensive and precise, to generate rights and obligations for private individu-
       als of its own accord. This is the case in so far as the value of a tax treaty in
       relation to Belgian domestic legislation is concerned.

       Tax system
       19.     The Belgian tax system is based on the Constitution which outlines
       the dominant principles, namely the legality of taxation and equality vis-à-
       vis taxation. The tax system is administered by the Service Public Fédéral
       Finances (SPF Finances, the Belgian Federal Public Service Finance) which
       is soon to be restructured in accordance with the new legal and regula-
       tory framework adopted at the end of 2009. It is expected that the SPF will
       be organised into six autonomous divisions, each in charge of one area of
       competence. One of these divisions will be in charge of taxation, another in
       charge of collection, and another in charge of the fight against tax fraud.
       20.      Natural persons or legal entities resident in Belgium are subject to
       taxation on world income. All natural persons whose domicile is in Belgium
       or whose seat of fortune is located in Belgium are regarded as residents.
       Barring any evidence to establish otherwise, and in simple terms, all natural
       persons entered in the National Registry5 are residents. All companies with
       their registered office in Belgium, their principal establishment in Belgium,
       or whose seat of management or of administration is located in Belgium are
       considered to be Belgian residents. Meanwhile non-resident natural or legal
       persons are taxed on their income from Belgian sources.
       21.     As a member of the European Union, Belgium takes part in the
       common system of VAT at a standard rate of 21% and a reduced rate of
       6%. Professional income of natural persons is taxed at progressive rates of
       between 25% applicable to the taxable income bracket below EUR 7 900, and
       50% applicable to the taxable income bracket above EUR 34 330. Income
       from capital paid to natural persons is taxed at a proportional rate that
       varies between 15% and 25%, or is subject to exemptions. Companies are
       taxed at a rate of 33%, or, in cases in which taxable income does not exceed
       EUR 322 500, on progressive rates ranging between 24.25% and 34.5%.

5.     The national registry is an IT system the purpose of which is to ensure the regis-
       tration, storage and communication of information relating to the identification
       of natural persons. The number in the national registry is also called “tax identi-
       fication number”.


PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
14 – INTRODUCTION

      22.     In 2007, the total tax revenue in Belgium stood at 44% of GDP, with
      VAT representing 16.3% of tax revenue, personal income tax 29.3%and cor-
      porate income tax 8.2%.
      23.      Belgium’s tax relations with its neighbours date back a very long time,
      since the country is party to the world’s oldest tax agreement still in force, namely
      the 1843 Franco-Belgian convention governing relations between the stamp tax
      authorities in France and Belgium. Today, Belgium’s treaty network covers 112
      jurisdictions, 99 of which are covered by double tax treaties and 13 others by tax
      information exchange agreements. Since March 2009 and its formal commit-
      ment to implementing the international standards of transparency, Belgium has
      signed 40 agreements and protocols complying with the standard, in particular as
      regards the exchange of banking information, and continues to be active in this
      area.
      24.      As an EU member country, Belgium exchanges information in accord-
      ance with Directive 77/799/EEC concerning Mutual Assistance in the field of
      Direct Taxation, the revision of which was recently adopted by the European
      Union Council. Belgium is also party to the OECD/Council of Europe
      Convention on Mutual Administrative Assistance in Tax Matters and will soon
      be a signatory to the protocol of 27 May 2010 amending this convention.
      25.     The Minister of Finance has delegated the role of competent authority
      to SPF Finances which also represents Belgium in international organisations
      where issues concerning the exchange of information on tax matters are dis-
      cussed, whether at EU, OECD or Global Forum levels.

Overview of the financial sector and the relevant professions

      26.      The commission bancaire, financière et des assurances (CBFA, or the
      Banking, Finance and Insurance Commission) is the sole Belgian authority
      responsible for the supervision of most financial institutions and financial ser-
      vices for the public. Through its activities, it seeks to protect savers and insured
      parties and to ensure the proper operation of markets in financial instruments.
      27.    Intermediary activities in financial services are the sole preserve of
      persons or entities registered with the CBFA or the similar authority of the
      home country in the case of those that are established in another state of the
      European Economic Area.
      28.      According to the most recent statistics available, there are 57 credit
      institutions comprising companies primarily involved in receiving money
      deposited by the public or other recoverable funds and in granting credit
      on their own behalf. In addition, 48 investment firms have their registered
      office in Belgium and 22 branches of investment firms with their registered



                     PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                                                                                     INTRODUCTION – 15



       office elsewhere in the European Economic Area are established in Belgium.
       Finally, 169 collective investment undertakings are administered in Belgium.
       29.      In Belgium, real estate agents, notaries (over 1 000), bailiffs, barristers
       (15 000), accountants and tax accountants (6 000), certified public accountants
       and tax consultants (almost 10 000) are all regarded as constituting non-finan-
       cial professions and enterprises under anti-money laundering legislation and
       are required, pursuant to this legislation, to perform a customer due diligence.

Recent developments

       30.       Belgium has signed 41 agreements and protocols that comply either
       with article 26 of the OECD Model Tax Convention or with the OECD Model
       on Tax Information Exchange Agreement, 40 of them since March 2009. The
       list of agreements now being negotiated may be accessed on the SPF Finances
       website. It indicates that, besides the 41 agreements already concluded,
       Belgium has initialled 24 additional agreements that comply with the interna-
       tional standard and has sent over 60 other proposals, the contacted jurisdic-
       tions being in position to accept or refuse the Belgium proposal to negotiate.
       31.      In keeping with its commitment, in March 2009, Belgium decided
       to introduce the automatic exchange of information under (EU) Council
       Directive 2003/48/EC, the “Savings Directive”, with effect from 1 January
       2010. Interest paid by Belgian intermediaries as of that date will be subject in
       2011 to automatic exchanges of information with the 33 jurisdictions6 that are
       party to this Directive (the transposition of these provisions is guaranteed in
       article 338 bis of CIR 92).
       32.     Finally, Belgium has demonstrated its commitment to both the
       Proposal for a Council Directive on Administrative Cooperation in the field
       of Taxation, which was adopted during its presidency of the Council of the
       European Union during the second semester of 2010, as well as the 27 May
       2010 protocol amending the OECD/Council of Europe Convention on Mutual
       Administrative Assistance in Tax Matters.




6.     Member states of the European Union as well as Aruba, British Virgin Islands,
       Guernsey, Isle of Man, Jersey, Montserrat, and the Netherlands Antilles


PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
                               COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION – 17




                      Compliance with the Standards




A. Availability of Information



Overview

       33.      Effective exchange of information requires the availability of reliable
       information. In particular, it requires information on the identity of owners and
       other stakeholders in an entity or arrangement as well as information on the
       transactions carried out by entities and other organisational structures. Such
       information may be kept for tax, regulatory, commercial or other reasons. If
       such information is not kept or the information is not maintained for a reasonable
       period of time, a jurisdiction’s competent authority may not be able to obtain and
       provide it when requested. This section of the report assesses the adequacy of
       Belgium’s legal and regulatory framework on availability of information.
       34.      Belgium has a sound legal and regulatory framework as regards the
       obligation to ensure that information concerning the identity of sharehold-
       ers in companies and partnerships is kept available. All such entities have to
       provide the registry of the locally competent commercial court with a copy
       of their articles of incorporation (memorandum of association). An extract of
       this document is published in the Moniteur belge (Belgium’s “official jour-
       nal”) and the company concerned is then registered in the “Banque Carrefour
       des Entreprises” [“BCE”]) constituting the Belgian register of legal entities.
       Information concerning the identity of shareholders that has to be disclosed at
       this point is limited to those jointly and severally liable for the company’s debts.
       35.      Thanks to other mechanisms, such as the shares registers for instance,
       all information concerning shareholders in companies not listed on a stock



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18 – COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

      exchange, namely sociétés privées à responsabilité limitée (SPRLs, or limited
      liability companies), sociétés coopérative à responsabilité illimitée (SCRIs, or
      cooperative companies with unlimited liability) and sociétés coopératives à
      responsabilité limitée (SCRLs, or cooperative companies with limited liability)
      is available to the Belgian tax authorities.
      36.      Information concerning shareholders in sociétés anonymes (SAs, or
      public limited companies) and sociétés en commandite par actions (SCAs, or
      partnerships limited by shares) is available in most situations. The law of 14
      December 2005 abolished bearer shares and requires them to be converted
      into registered or electronic securities7. As of 1 January 2008, bearer shares
      can no longer be issued, and bearer shares in listed companies are abolished.
      The conversion process for bearer shares in unlisted companies will be
      completed by 31 December 2013, at the latest. In the meantime, the Belgian
      authorities have put mechanisms in place to facilitate this conversion. These
      mechanisms could, however, be strengthened to accelerate the conversion of
      these shares.
      37.      Information concerning partnerships and persons involved with foun-
      dations is available. Where trusts are concerned and even though the Belgian
      legislation does not provide for the institution of trusts of Belgian law, trusts
      may be administered from Belgium or assets located in Belgium may be
      owned by a trust. As a professional, a trustee is required to keep all informa-
      tion needed to determine his/her income, which would include information
      on the property in the trust, the settlor and the beneficiaries. In addition, the
      anti-money laundering legislation adopted by Belgium states that service
      providers must keep records regarding settlors and beneficiaries of trusts.
      38.      Any entity subject to corporate income tax or legal entities income
      tax is required to keep a record of accounting data and supporting documents
      for a seven-year period. This ensures the availability of this information.
      39.      Banks and financial institutions are required to perform a customer
      due diligence and to hold records of transactions conducted by their custom-
      ers for a period of at least five years pursuant to anti-money laundering legis-
      lation, and for a period of seven years pursuant to accounting legislation.




7.    An electronic security is a security registered on an account with a clearing
      organization (Euroclear Belgium or the National Bank of Belgium) or a recog-
      nised account holder (e.g. credit institutions)


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A.1. Ownership and identity information

 Jurisdictions should ensure that ownership and identity information for all relevant
 entities and arrangements is available to their competent authorities.


       Companies (ToR A.1.1)
       40.      Five kinds of companies may be established in Belgium:
           The SA (public limited company) – Company Code – Book IV and
       Book VIII – is a company consisting of at least two shareholders, with a
       capital of at least EUR 61 500. The SA has to be incorporated by notarial
       deed. In Belgium, the SA is above all the form of company preferred by large
       enterprises, but it is also chosen by small and medium enterprises given that,
       except in certain specific situations, their securities are readily transferable,
       which is not the case with other kinds of companies that can be set up in
       Belgium. 94 000 companies in Belgium are public limited companies. 8
            The SE (European Company). European companies are regulated by
       Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for
       a European company (SE), which was transposed into Belgian law by Royal
       Decree of 1 September 2004, allowing for the creation and management of
       companies with a European dimension, and not strictly falling under the territo-
       rial scope of the domestic companies legislation in force in the country where
       they have been incorporated. Pursuant to Article 10 of the EU Regulation, the
       laws that apply to SEs are those that apply to public limited companies (SAs).
       Accordingly, the laws that apply to Belgian SAs apply in the same conditions
       to SEs.
           The SCA (partnership limited by shares) – Company Code – Book
       IV, Book VIII and Book IX – is formed between one or several partners who
       are jointly and severally liable, (the active partners), and one or more limited
       shareholders whose responsibility is limited to the amount of their contribu-
       tions (the limited-liability or dormant partners). The SCA consists of at least
       two shareholders, one of whom must be active and the other a limited (or
       dormant) partner. Shares are freely negotiable. With a minimum capital of
       EUR 61 500, the SCA must be formed by notarial deed. This type of com-
       pany is rarely used.
           The SPRL (limited liability company) – Company Code – Book IV
       and Book VI – is formed by one or several persons whose responsibility is
       limited to the level of their contributions. The SPRL is the only Belgian law
       company that can be established by one person alone. The shares issued by

8.     Statistics from 2008, source: Belgian National Bank.


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      the company are mandatorily registered shares that are only transferable
      under certain circumstances. Its share capital must be fully subscribed when
      the company is formed and amount to at least EUR 18 550. The articles of
      incorporation have to be drafted by notarial deed. There are 220 000 SPRLs
      in Belgium.
          The SCRI (cooperative company with unlimited liability) – Company
      Code – Book IV and Book VII – consists of at least three partners. No mini-
      mum capital is required to create it. It may be incorporated by notarial deed
      but incorporation by private deed is also accepted. 2 000 Belgian companies
      take the form of SCRI.
          The SCRL (cooperative company with limited liability) – Company
      Code – Book IV and Book VII – consists of partners, whose number and
      contributions may vary. The SCRL must be formed by at least three persons.
      It may be incorporated by notarial or private deed. Over 8 000 Belgian com-
      panies take this form.

      Publicity and registration formalities
      41.      In Belgium, SAs, SCAs and SPRLs have to be incorporated by
      notarial deed (i.e. one drafted by a notary). SCRLs and SCRIs, on the other
      hand, may be set up by private deed. However, irrespective of the deed and
      in compliance with article 67 of the Company Code, a copy of the deed of
      incorporation, together with an extract of the deed, have to be deposited at
      the registry of the local commercial court competent for the place where the
      company has its registered office within 15 days following its incorporation
      (article 68 of the Company Code).
      42.     Article 69 of the Company Code stipulates that the extract of the deed
      of incorporation should include the following information:
              the form of the company and its corporate name;
              the precise address of its registered office;
              the length of time the company will be in existence where this is not
              unlimited;
              the precise identity of its jointly and severally liable partners, its
              founders and partners who have yet to pay up their contribution; in
              the latter case, the extract specifies the amount due from each partner;
              the amount of share capital; the amount of paid-up capital; the amount
              of authorised capital;




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                the way in which the share capital or, otherwise, the partnership fund
                is formed and, where applicable, the findings of the report of the
                company auditor concerning contributions in kind;
                the identity of the persons authorised to administer the company and
                make binding commitments on its behalf, the extent of their powers
                and how they are to be exercised, whether action is taken single-
                handedly, jointly or in groups;
                the detailed description of each contribution, the name of the con-
                tributor, the name of the company auditor, and the conclusions of his
                or her report, the number and nominal value of the shares, or in the
                event of no nominal value, the number of shares issued in return for
                each contribution, as well as – where applicable – the other condi-
                tions attached to the contribution.
       43.      The extract of the deed of incorporation filed with the commercial
       court is then published in the Moniteur belge (Belgium’s official journal).
       This is done by the court registry within 15 days following submission of the
       documents. All documents submitted to the registry are kept for an unlimited
       period.
       44.      The commercial court registry also places the information with the
       Banque Carrefour des Entreprises (BCE), the registry of legal entities regis-
       tered in Belgium.
       45.      Established under the law of 16 January 2003, the BCE is a registry
       kept by the Federal Public Service Economy, the purpose of which is to
       register, safeguard, manage and make available information regarding the
       identification of enterprises (article 3 of the law). Any Belgian legal entity,
       any foreign legal entity with a seat in Belgium and any establishment must be
       registered in the BCE.
       46.     Pursuant to article 6 of the law of 16 January 2003, the BCE con-
       tains, among others and for a period of 30 years from the day legal entities
       lose their legal personality or permanently cease their activity, the following
       information:
                the name, corporate name or business name of the legal entity;
                the precise various addresses;
                the legal form and legal status;
                the date of incorporation and termination of the enterprise;
                the data identifying the founders, nominees and authorised representa-
                tives.




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      47.      In addition, pursuant to article 373 of the Company Code, the man-
      agement body of a co-operative with unlimited liability must submit a list in
      alphabetical order setting out the identities, occupations and domiciles of all
      co-operative partners to the local court registry every six months. Anyone
      can freely consult these lists and obtain copies.
      48.      In light of these requirements, the names of the founding partners of
      companies and, in generic terms, the identity of the active partners in SCAs
      (as jointly and severally liable partners) and partners (“associés”) in SCRIs
      is available to the Belgian authorities from the commercial court or the BCE.
      Furthermore, in the case of jointly and severally liable partners, all changes
      with respect to the identity of the partners must be filed with the commercial
      court registry and published in the Moniteur Belge and in the BCE.

      Register of registered shares
      49.      SPRL shares, like those of SCRIs and SCRLs, have to be registered9
      (articles 232 and 356 of the Company Code). The Code also states that each
      of these companies should hold at its registered office a register of these reg-
      istered shares including the identity of shareholders of SPRLs and partners
      of SCRIs and SCRLs, as well as all share transfers within such companies
      (see articles 233 and 357 of the Company Code). SPRLs, SCRIs and SCRLs
      cannot issue other types of shares.
      50.      SAs and SCAs are subject to the same requirement. When registered
      shares have been issued by these companies, they must know who their
      shareholders are and, for this purpose, have to keep a register of the shares
      including an exact description of each shareholder, the number of shares held,
      as well as the transfer, forwarding or conversion of the securities in question
      (article 463 of the Company Code). These companies are also allowed to issue
      electronic shares that are further described in the section on bearer shares.
      51.      Any interested third party, including the tax authorities, may consult
      the register of registered shares and thus get information on the identity of the
      shareholders in an SPRL, or the partners in an SCRL or SCRI.




9.    In French, these shares are called “nominative shares” that is, shares whose holder
      identity is known from the company. This identity is known because these shares
      must be registered in the registry of shares.


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       Tax requirements
       52.      When a company is created, a copy of the extract of the deed of incor-
       poration must be submitted to the enregistrement office10 of SPF Finances.
       Furthermore, before starting business, a company is obliged to apply for reg-
       istration with the VAT auditing office for its place of activity. This formality
       is mandatory for anyone wishing to launch an economic activity whether as a
       main or secondary line of business. However, no information concerning the
       ownership of the company is required to be provided upon registration.
       53.      There is no obligation to register with the administrative authorities
       responsible for direct taxation. The extract of the deed of incorporation pub-
       lished in the Moniteur belge by the registry of the commercial court and the
       recorded information entered in the registry of legal entities at the BCE, along
       with that provided to the VAT auditing office and the enregistrement office of
       SPF Finances are forwarded or made available to the appropriate administra-
       tive area office responsible for direct taxation.
       54.      Belgian companies covered by this section of the report are subject
       to corporate income tax (articles 2 and 179 of CIR 92). Accordingly, they are
       required to submit an annual tax return to the administrative authorities for
       direct taxation (article 305 of CIR 92).
       55.     The documents, statements or information which have to be provided
       as specified in the declaration form are an integral part of the declaration.
       Among them are the following:
       the annual accounts (balance sheet, profit-and-loss account and possible
       appendices);
       the reports to the general assembly and its discussions (including the list of
       shareholders present);
       56.      However this material is not sufficient to enable SPF Finances to hold
       updated information on the identity of Belgian company shareholders under
       all circumstances. Yet Belgian legislation contains other provisions which
       provide for the availability of information on shareholders and in particular,
       the shareholders of SAs and SCAs.

       Obligation to publicise major holdings in a company
       57.    Pursuant to EU regulations (Directive 2004/109/EC), on 2 May 2007,
       Belgium adopted a law on the publication of major shareholdings in issuing
       bodies whose shares are eligible for trading on a regulated stock exchange.

10.    “Enregistrement” office: local tax office where all deeds and some private con-
       tracts subject to a stamp tax must be submitted.


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      58.      Pursuant to article 6 of this law, any natural person or legal entity
      that directly or indirectly acquires securities conferring on it a voting rights
      quota of 5% or more of all voting rights must inform the company as well
      as the CBFA. This notification is also required when the number of voting
      rights reaches or exceeds a quota of 10%, 15% or 20% and in the event of any
      further increases of 5%.
      59.       The issuing company that receives this notification must ensure
      that it is published on its website no later than three trading days following
      its receipt (article 14 of the Royal Decree of 14 February 2008). In addition
      and pursuant to the same article, Belgian issuing bodies have to specify in
      the capital statement attached to their annual accounts the structure of their
      shareholding on the date the accounts were closed, as shown in the statements
      they have received about major holdings.
      60.   The effect of this obligation is that all shareholdings in listed Belgian
      companies in excess of 5% are public.
      61.     Further requirements directly derive from the legislation on bearer
      shares adopted by Belgium on 14 December 2005 (see section A.1.2 on bearer
      shares below).

      Foreign companies

      Main establishment of a foreign company established in Belgium
      62.      Pursuant to article 110 of the private international law code, which
      states that a “legal entity is governed by the law of the state in the territory in
      which its main establishment is situated from the time at which it is formed”,
      a foreign company may be governed by Belgian company law if it has its
      main establishment in Belgium.
      63.      In this situation, publicity, registration and record-keeping formali-
      ties are similar to those applicable to companies directly established under
      Belgian law. The availability of information concerning the ownership of
      those companies described above is guaranteed under the same terms.

      Belgian branch of a foreign company
      64.      Articles 81-87 of the Company Code set out the rules for publicity that
      apply to foreign companies branches of with an establishment or branch in
      Belgium. Pursuant to articles 81 and 82 of the Company Code, before estab-
      lishing a branch in Belgium, companies governed by the law of another state
      must make the following documents and details public:




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                the articles of incorporation (memorandum of association) and/or
                articles of association;
                the corporate name and legal form;
                the registry with which a file has been opened in the company name
                and the registration number of the company in that registry;
                the address and description of activities of the branch, as well as its
                corporate name if this is not the same as that of the company;
                the name and identity of the persons empowered to commit the com-
                pany vis-à-vis third parties and to represent it in court;
                the annual and consolidated accounts of the company for the most
                recently closed financial year.
       65.      These documents are made public in the 30 days immediately follow-
       ing the occurrence of the decision or the event, by the filing with the registry
       of the commercial court in the jurisdiction of which the branch of the foreign
       company is located (articles 83 and 84 of the Company Code). The documents
       are kept on record by the registry and the companies concerned are entered in
       the registry of legal entities held by the BCE.
       66.      The rules for the registration of foreign companies with the tax author-
       ities are the same as those applicable to Belgian companies: they involve reg-
       istration with the appropriate VAT office, while the office for direct taxation
       is informed of the company’s existence by means of the information available
       from the BCE, the enregistrement office11 of SPF Finances and the department
       responsible for VAT.

       Anti-money laundering legislation and information held by nominees

       Anti-money laundering legislation
       67.      The anti-money laundering rules are set out in the law of 11 January 1993
       as recently amended by the law of 18 January 2010 12 and the Royal Decree of
       6 May 2010. For the bodies and persons to whom the law applies, these rules
       include obligations regarding the identification of customers and verification of
       their identities.

11.    “Enregistrement” office: local tax office where all deeds and some private con-
       tracts subject to a stamp tax must be submitted.
12.    The current AML/CFT legislation mainly derives from Directive 2005/60/EC of
       the European Parliament and of the Council of 26 October 2005 on the Prevention
       of the use of the Financial System for the Purpose of Money Laundering and
       Terrorist Financing.


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      68.     Pursuant to articles 2 and 3 of the law, the persons and entities subject
      to the obligation concerning client identification are:
              credit and financial institutions;
              investment companies;
              bailiffs and notaries;
              auditors, chartered accountants and tax advisers; and
              lawyers, legal advisers, in particular when they act as trust or com-
              pany service providers or where they are involved on behalf of their
              clients in any financial or real-estate transaction.
      69.      Pursuant to article 7 of the AML/CFT law these entities and profes-
      sionals are required to perform a customer due diligence (CDD) and therefore
      identify their customers and clients when:
              a customer wishes to enter into business relationships which will
              make that person a regular customer;
              a customer wishes to complete a transaction outside the scope of the
              business relations referred to immediately above,
              -   of which the amount reaches or exceeds EUR 10 000, whether
                  the transaction is carried out in one or several operations that
                  appear to be related; or
              -   which involves a transfer of funds in the sense of Regulation (EC)
                  No. 1781/2006 of the European Parliament and of the Council of
                  November 15, 2006 on information on the payer accompanying
                  transfers of funds;
              money laundering or the financing of terrorism is suspected, outside
              of the situations described in the first and second points above;
              there are doubts about the truthfulness or accuracy of the identifica-
              tion data concerning an already identified customer.
      70.     Pursuant to articles 7 and 8 of the law, when the customer is a com-
      pany or a partnership, identification of the customer and verification of its
      identity includes the corporate name, the registered office, the board mem-
      bers and knowledge of provisions governing the power to make commitments
      on the company’s behalf.
      71.     Furthermore, bodies and persons coming within the scope of the
      anti-money laundering legislation must identify the beneficial owner(s) of
      the customer and take appropriate measures commensurate with the risk, in
      order to verify their identities. Under the anti-money laundering legislation,



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       beneficial owners are to be regarded as the one or more natural persons on
       behalf of whom or for the benefit of whom a transaction is conducted or a
       business relation initiated, or the one or more natural persons who ultimately
       possess or control the customer. This means in particular:
                the one or more natural persons who ultimately possess or control
                directly or indirectly more than 25% of the company’s or partner-
                ship’s shares or voting rights;
                the one or more natural persons who in some other way exert control
                over the company’s management.
       72.     Identification of the beneficial owner is concerned with the person’s
       surname and first name and, to the extent possible, the date and place of
       birth. As far as possible, relevant information also has to be gathered about
       the person’s address. In addition, appropriate measures commensurate with
       the AML/CFT risk profile of the client13 have to be taken to verify this
       information.
       73.      The bodies and persons within the scope of the law must update the
       identification data of the beneficial owners of a client with which they have
       business relationships when it appears that the information concerning those
       beneficiaries is no longer current. The frequency of such updates is dependent
       on the AML/CFT risk profile of the client.
       Nominees
       74.      There is no specific provision in Belgian tax law that deals with the
       specific question of nominees. Anti-money laundering legislation, however,
       establishes an obligation regarding identification of customers for a whole
       series of service providers. In particular, all legal and natural persons covered
       by the provisions of the AML/CFT law must identify their clients as well as
       all nominees acting on behalf of their clients. The identification of the nomi-
       nee is ensured in the same way as above described (see article 7 para 2 and 3
       of the law).
       75.      In addition, under the general obligations arising from CIR 92 and,
       in particular, the obligation for all taxpayers or third parties to forward to the
       Belgian authorities any information enabling them to determine the amount
       of taxable income, whether this income is that of the nominee or of the real
       shareholder, the obligation to keep information on property held through
       nominees is ensured in Belgium.



13.    Further information on the way this AML/CFT profile risk must be considered
       is described in a regulation of the CBFA dated 23 February 2010.


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      Bearer shares (ToR A.1.2)

      Obligations stemming from the abolition of bearer shares
      76.       On 14 December 2005, Belgium adopted a law to abolish bearer
      shares. Pursuant to this law and since 1 January 2008, it has only been pos-
      sible to issue electronic14 or registered securities in Belgium. Furthermore, on
      1 January 2008 all bearer shares issued by companies listed on a regulated
      market, and which were listed on a securities trading account, were automati-
      cally converted into electronic securities.
      77.        Unlisted companies will have to convert bearer shares issued
      between the publication of the law and 1 January 2008 by 31 December 2012,
      and securities issued prior to the publication of the law by 31 December 2013
      at the latest. In the intervening period, and in order to accelerate the conver-
      sion, Belgian legislation provides that:
      Any person who acquires bearer shares conferring on it a voting rights quota
      of more than 25% of all voting rights must declare this acquisition;
      Any person who disposes of bearer shares pursuant to which its voting rights
      quota falls below 25% must declare this disposition;
      The voting rights attaching to bearer shares that have not been converted
      within the periods provided by law will be suspended when the period
      granted by the Belgian legislation to transform the shares expires;
      Finally, if the bearer shares are not converted by 31 December 2013, the
      issuing company must, from 1 January 2015, sell these shares (whether in
      electronic or registered form) to other purchaser.
      78.      While the assessment team looks favourably upon these mechanisms,
      they could nevertheless be reinforced in order to ensure the rapid conversion
      of bearer shares. In any event, when the 14 December 2005 law has produced
      all of its effects, the identity of shareholders in Belgian companies will be
      known, following two systems:
              the system of registered shares described above which enables the
              company to know its shareholding, since it must keep a registry of
              such shares;
              the system of electronic securities, in which the identity of the share-
              holder will be known to the account holder.


14.   An electronic security is a security registered on an account with a clearing
      organization (Euroclear Belgium or the National Bank of Belgium) or a recog-
      nised account holder (e.g. credit institutions)


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       Partnerships (ToR A.1.3)
       79.    Belgian law provides for the establishment of two kinds of partner-
       ships:
            The Société en Nom Collectif (SNC, or general partnership) –
       Company Code – Book IV and Book V – is one formed by at least two part-
       ners who are jointly and severally liable for all its commitments. The shares of
       an SNC cannot, in principle, be transferred. No minimum capital is required
       to form an SNC. The partnership may be formed by notarial or private deed.
           The Société en Commandite Simple (SCS, or limited partnership)
       – Company Code – Book IV and Book V – is a partnership formed by one
       or several partners who are jointly and severally liable (the active or general
       partners), and one or more limited partners (the dormant partners) whose
       liability is limited to the level of their contribution. Limited partners cannot
       engage in management activity, even through a power of attorney. No mini-
       mum capital is required to form such a partnership. A SCS may be formed by
       notarial deed but this is not mandatory.
       80.      Partnerships are governed by the Company Code and, more particu-
       larly, Book IV, which contains common regulations applicable to all compa-
       nies and partnerships established under Belgian law. The publication and
       registration formalities are the same as those that apply to SAs, SCAs, SPRLs,
       SCRLs and SCRIs and described above in sub-section A.1.1.
       81.      An extract of the deed of incorporation of the partnership must be
       filed within 15 days with the registry of the commercial court which keeps
       the documents on record. The publication in the Moniteur belge (Belgium’s
       “official journal”) is the responsibility of the registry, which then ensures that
       the partnership is entered in the BCE acting as the registry of legal entities.
       82.      The information contained in the extract of the deed of incorporation,
       which is held by the registry of the commercial court and published in the
       Moniteur belge and in the BCE, is similar to the information provided by SAs
       and SCAs. The list of the founders of partnerships and of partners who have
       unlimited liability is readily accessible public information. It is thus possible to
       obtain the identity of SNC partners and SCS general partners. All transfers of
       shares leading to changes in the identity of partners who are jointly and sever-
       ally liable must, in addition, be published (article 74 1° of the Company Code).
       83.     The SNCs and SCSs are not required to maintain a registry of part-
       ners and the number of shares held by each. However, as the transfer of shares
       is subject to approval of the partners under Belgian law (articles 38 and 209
       of the Company Code), SNCs and SCSs always know the identities of all of
       the holders of shares, whatever their function in the partnership, and this




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      information can be obtained by the Belgian authorities upon simple request
      (section B, Access to Information).
      84.      The formalities for registration with the tax authorities are similar to
      those described above for companies. The extract of the deed of incorporation
      of the partnership must be filed with the enregistrement office of the Belgian
      tax authorities (SPF Finances). In addition, before beginning its activity, a
      partnership is required to apply for registration with the VAT auditing office
      for the area in which it intends to do business. The application for registration
      is mandatory for anyone wishing to start an economic activity as a main or
      secondary line of business (article 50 of the VAT Code).
      85.      Partnerships are under no obligation to register with the authorities for
      direct taxation. The information published in the Moniteur belge (e.g. when
      the partnership is formed) and contained in the registry of legal entities of the
      BCE, as well as the details sent to the VAT auditing office and included in the
      deed of incorporation registered with the SPF Finances enregistrement office,
      are forwarded or made available to the authorities for direct taxation.
      86.      Belgian law partnerships have legal personality and are subject to cor-
      porate income tax (articles 2 and 179 of CIR 92). They are required to submit an
      annual tax return to the authorities for direct taxation (article 305 of CIR 92).
      87.     The documents, statements and information which must be provided
      according to the declaration form are an integral part of the declaration and
      have to be appended to it. They include the following:
              the annual accounts (balance sheet, profit-and-loss account and pos-
              sible appendices);
              the reports to the general assembly and its discussions (including the
              list of those present).
         The information available at SPF Finances is thus identical to the infor-
      mation that can be obtained from the registry of legal entities or the com-
      mercial court registry.
      88.    This set of laws and regulations ensures that the identity of SNC and
      SCS partners is available and updated.

      Trusts (ToR A.1.4)
      89.    It is impossible to establish trusts under Belgian law. Moreover,
      Belgium is not a signatory to the Hague Convention of 1 July 1985 on the
      Law Applicable to Trusts and on their Recognition.
      90.     That said, chapter XII of the private international law code recog-
      nises and regulates certain aspects of trusts established under foreign law.



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       Article 122 of this code includes a definition of a trust, while article 123 rec-
       ognises that Belgian courts are competent for hearing cases concerning a trust
       administered in Belgium or assets located in Belgium and placed in trusts.
       91.      Thus although Belgium is a civil law country and, in that respect,
       does not authorise the establishment of trusts as such, it does recognise that
       trusts formed abroad may have effects in Belgium in that they can be admin-
       istered from within Belgium or possess assets there. In particular, Belgium
       has adapted its legislation to prevent the legal ramifications of a trust from
       compromising the public policy contained in the Belgian legislation, such as
       rules governing succession.
       92.      As regards the availability of information concerning the settlors,
       trustees and beneficiaries of trusts, Belgian civil law requires neither the
       registration of trusts nor the prior disclosure of this information. Only a legal
       action by order of a judge could result in this information being made public.
       93.     Furthermore, Belgian tax law does not contain provisions regard-
       ing the information that has to be held by trustees resident in Belgium and
       involved in trusts established pursuant to foreign legislation.
       94.     According to the analysis developed by the Belgian administration
       in two administrative decisions, the income received through a discretion-
       ary trust is considered to be earned by the trustee and is subject to personal
       or corporate income tax, depending on the nature of the trustee. In the case
       of a “fixed interest” trust, the income of the trust is however considered to
       be earned by the beneficiaries and is taxable in their hands. In this case, the
       Belgian administration may ask the taxpayers or the trustee for all informa-
       tion which will allow it to determine the amount of income.
       95.      From a general perspective, if information is considered necessary for
       Belgian tax assessment purposes, the taxpayer has an obligation to disclose
       such information to the tax authorities. This may include information about
       settlors, trustees and beneficiaries. Furthermore, trustees resident in Belgium,
       as professionals, are subject to record-keeping requirements for the determi-
       nation of their own income. Thus in the case of a trust, all records that are
       necessary for determining whether the trust income is taxable in the hands
       of the trustee or not must be kept. This includes the names of the settlors and
       named beneficiaries of the trust or the nature of the assets in the trust that
       have generated the income.
       96.      With regard, therefore, to general tax requirements in Belgium pur-
       suant to which all taxpayers must be capable of providing information to the
       Belgian tax authorities whenever taxable income has to be determined, a trus-
       tee resident in Belgium must be in a position to provide SPF Finances with
       information on the settlors and beneficiaries of trusts that (s)he administers
       from Belgium.


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      Anti-money laundering Legislation
      97.      Lawyers, tax advisors as well as all professionals who acts as as trust
      service providers come specifically within the scope of the anti-money laun-
      dering legislation when they help their clients to prepare or conduct trans-
      actions concerning the formation, administration or management of trusts
      (article 3 of the law of 11 January 1993 as amended). Pursuant to article 7 and
      article 8, paragraph 1 of the foregoing law, these service providers must keep
      information on the identity of their clients and the beneficiaries of trusts. As
      result, professionals acting as trustees in Belgium are obliged to identity their
      clients (settlors and beneficiaries) and when the beneficiary is a legal person
      must identify those who have an interest of 25% or more in the entity.

      Foundations (ToR A.1.5)
      98.      In Belgium, foundations are non-profit entities usually set up for purely
      charitable purposes. However, since 1998, foundations may be established for
      private purposes, that is to say, foundations in which the founder may dedicate
      property for a private purpose devoid of any self-interest. This category could
      include, for example, the safeguarding of an art collection, the keeping of a
      business within the family, or the maintenance of a child with special needs.
      99.      Under Belgian legislation and in compliance with article 27 of the law on
      foundations of 27 June 1921 as amended by the law of 2 May 2002, “the estab-
      lishment of a foundation is the result of a legal act emanating from one or several
      natural persons or legal entities, which involves allocating assets to achieve a
      particular goal devoid of any self-interest. The foundation may not result in any
      material gain for its founders, its directors or any other person unless, in this last
      instance, such gain is part and parcel of the foregoing disinterested goal. The
      foundation includes neither members nor partners. To be valid, it must be consti-
      tuted by notarial deed.” A Belgian foundation does not have beneficiaries.
      100.    Article 28 of the law on foundations states that a foundation’s articles
      of association should state the following, at a minimum:
               the surnames, first names, place of residence, and date and place of
               birth of each founder or, in the case of a legal entity, the corporate
               name, the legal form and the address of the registered office;
               the official name of the foundation;
               the precise description of the aim or aims underlying the establish-
               ment of the foundation, as well as the activities it intends to imple-
               ment to achieve these goals;
               the address of the seat of the foundation, which must be located in
               Belgium […].



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       101.     Article 31 of the law states that the commercial court registry keeps a
       file on record for each private foundation and public interest foundation which
       has its seat or operational seat in the judicial district concerned. The founda-
       tion is also registered by the acting notary or, if not, by the above court regis-
       try in the register of legal entities of the Banque-Carrefour des Entreprises.
       102.     In compliance with the same article, the information which is required
       to be placed in the file includes:
                the articles of association and their amendments;
                the amalgamated text of these articles following their amendment;
                the legal documents concerning the appointment, the rescission and
                the termination of the responsibilities of the directors and, where
                applicable, of the persons authorised to represent the foundation.
                These documents specify the extent of the powers of the persons
                concerned and how they should be exercised;
                the annual accounts of the foundation;
                the decisions and legal documents concerning the dissolution and
                liquidation of the foundation.
       103.   The following information is published in the appendices to the Moniteur
       belge:
                the articles of association and their amendments;
                the legal documents regarding the appointment, the rescission and the
                termination of the responsibilities of the directors and, where appli-
                cable, of the persons authorised to represent the foundation; these
                documents specify the extent of the powers of the persons concerned
                and how they should be exercised;
                the decisions and legal documents concerning the conversion of a
                private foundation into a public interest foundation, in accordance
                with article 44;
                the decisions and legal documents concerning the dissolution and
                liquidation of the foundation.
       104.    Thus, since the articles of association and their amendments must be
       the subject of a notarial deed entrusted to the registry of the commercial court
       and published in the Moniteur belge, the information concerning the founders
       of private foundations and members of their boards is known to the Belgian
       public authorities.




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      Establishment of provisions to ensure the availability of information
      (ToR A.1.6)

      Penalties for failure to legally document the establishment of bodies
      or to register them
      105.      Persons or entities that have not filed the full text of their articles of
      association with the commercial court registry within three months from the
      date of the articles are punishable by a fine of EUR 50-10 000 (articles 90 and
      91 of the Company Code). This fine applies to Belgian law companies and
      Belgian branches of foreign companies. It is incurred for failure to submit
      either the legal documents required at the outset or the subsequent documents
      amending them. Furthermore, companies failing to register do not acquire
      legal personnality.
      106.     In cases of non-filing or late filing of documents with the commer-
      cial court registry, a fine of EUR 25-250 is incurred for every month’s delay
      (article 256 (1) of the Code of stamp duties, mortgage duties and court fees).
      107.     In addition, the law of 16 January 2003 setting up the “Banque Carrefour
      des Entreprises” provides for administrative and criminal sanctions for fail-
      ure to comply with its provisions, and in particular as regards the registration
      requirements (articles 62 para 2 and 5 and article 63).
      108.    As regards private foundations, the law of 27 June 1921 states that a
      foundation will only acquire legal personality from the day that its articles of
      association and the legal documents certifying the appointment of its direc-
      tors are placed in the file held at the court registry. The failure to register
      deprives the foundation of legal personality.
      Regarding sanctions for the failure to keep the share register in SAs and
      SCAs or in SPRLs, SCRLs, SCRIs, the Belgian Company Code provides that
      company directors and managers are jointly responsible towards the company
      itself or any third parties for any damage caused by an infringement of the
      company’s statutes, or management errors (see articles 263, 408, 528 and 657
      of the company code). The Company Code also provides for criminal sanc-
      tions for errors in entries in the share register (see articles 348, 388 and 649).
      Failure to comply with these requirements is punishable by imprisonment
      from one month to three years and a fine of EUR 26 to 3 000 (see article 496
      of the Penal Code). Finally, Belgian case law (decision of the Court of Appeal
      of Brussels, 24 June 1981), states expressly that if a company does not respect
      the legal requirements for maintaining a register of shares, it is responsible
      vis-a-vis the injured shareholder.




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       Disclosure of major interests
       109.    Non-compliance with the obligations may have civil, administrative
       or criminal consequences and, in particular, can result in the following:
                no person can take part in voting at the general assembly of a company
                by casting a number of votes greater than that linked to the securities
                (s)he has declared to be in his or her possession, in compliance with
                articles 514, 515, paragraph 1, or 515(a), paragraph 1, at least 20 days
                before the date of the general assembly (article 545 of the Company
                Code). However, if the shareholder concerned knowingly takes part
                in voting, (s)he may be criminally liable to a fine of EUR 275-55 000;
                if the required declarations have not been made in accordance with
                the prescribed procedures and schedule, the president of the commer-
                cial court for the jurisdiction in which the company has its registered
                office may:
                -    order the suspension of all or some of the rights linked to the
                     securities concerned for a period of up to a year;
                -    suspend the holding of a general assembly already convened for
                     a fixed period, as (s)he determines;
                -    order the sale, under his or her supervision, of the securities con-
                     cerned to a third party unconnected to the current shareholder,
                     within a period which (s)he determines and is renewable.

       Legislation on the abolition of bearer shares
       110.     The law of December 14, 2005 states that companies that have not
       complied with their obligations to identify holders of bearer securities must
       sell those securities on January 1, 2015, failing which they will be subject to a
       fine equal to 10% of the value of the securities for every year that the obliga-
       tion to identify is delayed.

       Anti-money laundering legislation
       111.    When the Cellule de Traitement des Informations Financières (CTIF,
       or Financial Information Processing Unit) detects an infringement of the
       11 January 1993 law against money laundering, it may inform the auditing or
       supervisory authorities, or the disciplinary authorities, so that these authorities
       can take the appropriate measures and hand down administrative penalties.
       112.   In the event of failure to comply with the law, these authorities may,
       pursuant to article 40, impose an administrative fine in the amount of at least
       EUR 250 but no greater than EUR 1 250 000.



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      113.     The existence of these penalties specifically provided for in the leg-
      islation to prevent money laundering and the funding of terrorism does not
      compromise the use of other administrative or disciplinary penalties imposed
      in accordance with the governing legislation.

               Determination and factors underlying recommendations

                                          Conclusion
      The element is in place, but certain aspects of the legal implementation
      of the element need improvement.
             Factors underlying the                         Recommendations
               recommendations
      Under Belgian legislation, the              The Belgian authorities should exam-
      conversion of bearer shares [into           ine the conditions under which mech-
      electronic or registered shares] will be    anisms to encourage conversion of
      completed by December 31, 2013.             bearer shares can be strengthened
                                                  so that the information regarding their
                                                  holders is available as quickly as
                                                  possible.


A.2. Accounting records
       Jurisdictions should ensure that reliable accounting records are kept for all
       relevant entities and arrangements.

      General requirements (ToR A.2.1)
      114.     The obligation for businesses established in Belgium to keep account-
      ing records is found in the law of 17 July 1975 concerning accounting for
      enterprises, and more particularly in articles 3, 4, 6, 7, 9 and 10. Regulations
      relating to annual accounts, consolidated accounts and publicity formalities
      are incorporated in the Royal Decree on the implementation of the Company
      Code.
      115.   The general accounting requirements in the law of 4 September
      1975 cover the following:
              natural persons acting as businesspersons;
              business companies or companies with a commercial status, the busi-
              ness goals of a company being set out in the articles of association;
              public bodies that carry on business, financial or industrial activities;




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                any other body with or without its own legal status, pursuing busi-
                ness, financial or industrial activities. Professional trustees are cov-
                ered by these obligations.
       116.     The accounting practice of legal entities (article 3 of the law) must cover
       all transactions, assets and entitlements of any kind, and their debts, obligations
       and commitments of any kind. All accounting is based on a system of books and
       accounts and conducted in line with the customary regulations for double-entry
       bookkeeping. Any entry is backed by dated supporting evidence and includes a
       reference to that evidence. After being balanced with data in the inventory, the
       accounts are descriptively summarised to form the annual accounts.
       117.    Medium and large enterprises have to carry out double-entry book-
       keeping in accordance with the legal framework, establish an annual inven-
       tory and draw up annual accounts. These accounts are submitted for the
       examination and approval of the general assembly convened for this purpose.
       In the 30 days following their approval, they have to be submitted to the
       National Bank of Belgium (BNB) which checks their content. The annual
       accounts may be consulted on the BNB website. This website includes infor-
       mation on legal entities which since 1992 have directly deposited annual or
       consolidated accounts with the BNB, or which are supposed to submit annual
       accounts to it in light of their legal form and circumstances.
       118.     General or limited partnerships, whose turnover in the most recent
       financial year, excluding value added tax, is no more than EUR 500 000 may
       keep “simplified” accounting records as long as all their transactions are
       entered promptly, reliably and fully in chronological order in at least three
       books, namely a cash book, a purchase book and a sales ledger. At least once
       a year, these enterprises are also required to establish an inventory of all
       assets, receivables, debts and obligations, as well as all resources earmarked
       for operational purposes (article 5 of the law). These accounts are also avail-
       able on the BNB website. Finally, even though these two types of partner-
       ships may keep simplified accounting records, they must nevertheless submit
       an annual tax return to the tax authorities (see below).
       119.    In order to guarantee the continuity of these accounting documents,
       their pages are numbered and they form a continuous series, each in accord-
       ance with its own particular purpose.
       120.     Books and documents from which one can determine the amount of
       taxable income have to be kept for possible consultation by the authorities, in
       the office, agency, branch or any other professional or private premises of the
       taxpayer in which they have been held, drawn up or addressed (article 315 of
       CIR 92). These premises correspond to the seat which is the focal point for
       management activity, as well as the administration of interests and company
       business.



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      121.     Each entity liable to corporate income tax or legal entities income
      tax is required, pursuant to article 305 of CIR 92, to submit a declaration
      of income on an annual basis. The company or legal entity must attach its
      annual accounts (balance sheet, profit-and-loss account and possible appen-
      dices) to the declaration as well as all reports to the general assembly and the
      minutes of its meetings. These declarations can be audited by SPF Finances.
      122.    Thus given both the accounting and tax legislation, Belgium ensures
      the availability of accounting data from which it is possible to accurately
      review all transactions, to assess the financial position of all entities, and to
      prepare financial statements.

      Underlying documentation (ToR A.2.2)
      123.   Belgian accounting legislation lays down that any entry must be
      backed by dated supporting evidence and must contain a reference to that
      evidence (article 6 of the law of 4 September 1975).
      124.     Furthermore, since Belgium is an EU member and thus party to
      the intra-community VAT system, Belgian businesses are subject to special
      requirements regarding evidence of transactions carried out. In particular,
      it is necessary to keep all documents that can be used to review intra-com-
      munity flows of goods and services, including invoices issued and received,
      goods delivery notes, or the contracts under which purchases and sales have
      been conducted.
      125.    These different requirements ensure that the accounting data which
      Belgian businesses have to keep on record include the supporting documents
      needed as evidence of the transactions carried out.

      Document retention (ToR A.2.3)
      126.     Pursuant to accounting legislation, all businesses are required to keep
      a record of their accounts for seven years from 1 January of the year follow-
      ing the closing date of accounts (article 8, paragraph 2 of the law). Supporting
      documents have to be kept for seven years as originals or copies and methodi-
      cally classified. This period is reduced to three years in the case of documents
      not required to provide proof vis-à-vis third parties (article 6 of the law).
      127.    Tax legislation (direct taxation) states that all books and documents
      which can be used to determine the amount of taxable income have to be kept
      for possible consultation by the authorities until the end of the seventh year
      or seventh financial year subsequent to the assessment period (article 315 of
      CIR 92).




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       128.     With regard to VAT, article 60 of the VAT Code specifies a record-
       keeping period of seven years (a special period of 15 years applies to transac-
       tions the purpose of which is the construction or purchase of a building with
       payment of VAT).
       129.     Given the tax and accounting requirements set out in the various laws
       in force in Belgium, the safekeeping of accounting information for a period
       of at least five years is guaranteed.

                  Determination and factors underlying recommendations

                                             Conclusion
       The element is in place.


A.3. Banking information
        Banking information should be available for all account-holders.

       Record-keeping requirements (ToR A.3.1)
       130.    Article 4, paragraph 1 of the law of 11 January 1993 imposes an obli-
       gation upon organisations to identify and verify, by means of a conclusive
       document, the identity of customers who enter into business relationships
       with the organisation pursuant to which they will become regular customers.
       Article 5 of the CBFA regulation of 27 July 2004 states that in fulfilling their
       legal obligations to identify their customers, organisations must take any
       appropriate measure to prohibit customers from opening anonymous accounts
       or ones under false or assumed names, and to verify compliance with this
       ban.
       131.    Customers are only allowed to open numbered accounts in compli-
       ance with special regulations determined by the organisation that fix the
       conditions under which such accounts may be opened and how they should
       function. In addition, these conditions and procedures cannot compromise
       the application of the provisions of the AML/CTF legislation concerning
       the identification of the customer and of economic beneficiaries, special
       measures regarding distance relations, the keeping of data on record, and the
       customer due diligence obligation (article 8).
       132.     The use of numbered accounts is restricted by financial organisations
       to persons who can justify a real need for discretion (this system allows the
       identity of the account holder to be hidden from the front line employee). The
       opening of these accounts is, in practice and as required by the CBFA, subject
       to increased identification measures (verification of the reasons justifying



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      the need for a numbered account and hierarchical authorization). Complete
      information on the account holder must be available.
      133.    The situations in which bodies and persons subject to the law are
      required to identify their customers are as follows:
              when they enter into business relationships which will make them
              regular customers;
              when the customer wishes to carry out:
              -     a transaction of which the amount reaches or exceeds EUR 10 000,
                    whether the transaction is carried out in one or several operations
                    that appear to be related; or
              -     a transaction – even where the amount is less than EUR 10.000 –
                    whenever there is a suspicion of money laundering or terrorism
                    financing; or
              -     a transfer of funds within the scope of article 139 (a), paragraph 2,
                    of the law of 6 April 1995 concerning the status of enterprises and
                    their control, intermediaries and investment advisers;
              where there are doubts about the truthfulness or accuracy of the iden-
              tification data regarding an existing customer.
      134.      The rules regarding the conservation of records in Belgium provide
      that all financial institutions will preserve all documents necessary to recon-
      stitute transactions. In particular, Article 15 of the law of 11 January 1993, as
      amended, provides that all financial organisations will, for a period of at least
      five years, keep a copy of registrations, invoices, and documents concerning
      transactions such as to permit them to be precisely reconstituted.
      135.     Finally, Article 3 of the (EU) Council Directive 2003/48/EC of 3
      June 2003 on the taxation of interest payments (Savings Directive) requires
      that financial institutions paying interest to their clients keep information on
      account holders who are not Belgian residents but are residents of other EU
      member states.

                  Determination and factors underlying recommendations

                                           Conclusion
      The element is in place.




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                                      COMPLIANCE WITH THE STANDARDS: ACCESS TO INFORMATION – 41




B. Access to Information



Overview

       136.     A variety of information may be needed in respect of the administra-
       tion and enforcement of the relevant tax laws and jurisdictions should have
       the authority to access all such information. This includes information held
       by banks and other financial institutions as well as information concerning
       the ownership of companies or the identity of interest holders in other persons
       or entities, such as partnerships and trusts, as well as accounting information
       in respect of all such entities. This section of the report examines whether
       Belgium’s legal and regulatory framework gives the authorities access powers
       that cover the right types of persons and information and whether taxpayers’
       rights and safeguards that are in place would be compatible with effective
       exchange of information.
       137.     Pursuant to CIR 92, the Belgian tax authorities have extensive powers
       of access to information for their own purposes. In particular, these powers
       enable them to request information from any taxpayer or third party likely
       to be in possession of the information sought to assess income or collect tax.
       The Belgian authorities use these same powers for the international exchange
       of information.
       138.     Subject to some exceptions, the Belgian authority in charge of assess-
       ing income tax is not authorised to access information held by financial
       institutions for the purpose of assessing the income tax of the clients of the
       financial institutions15 (article 318, paragraph 1 of CIR 92). However, since
       Belgium made its formal commitment in 2009 to international standards in
       transparency, it has begun the process of reforming its entire network of tax
       information exchange agreements in order to remedy this situation (see sec-
       tion C of this report). From this point of view, access to banking information
       held in Belgium is anticipated.

15.    It should be noted, however, that access to this information is allowed in matters of VAT,
       tax collection, assessment of inheritance tax, and, for example, automatic exchange of
       information in the context of the Savings Directive.



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      139.     The existing conflict between Belgian domestic law and the measures
      set out in the treaties amended since 2009 will be resolved through legisla-
      tion that implements the treaties. In the Belgian/US framework, Belgium’s
      only treaty in force which includes access to banking information, it is stated
      specifically that article 318 of CIR 92 does not apply to the exchange of infor-
      mation under the terms of the treaty.
      140.     For its own purposes, the Belgian administration has access to infor-
      mation during a period of three years, or a period of seven years if it informs
      the Belgian taxpayer required to furnish the information of the reasons for
      which the extension to seven years is requested. In the case of a request for
      information from a treaty partner, the Belgian administration interprets its
      legislation as allowing it to access the information during the seven year
      period, as long as the requesting party justifies the extension. This inter-
      pretation and the Belgian administration’s practices will be given additional
      scrutiny during the course of the Phase 2 Peer review.

B.1. Competent Authority’s ability to obtain and provide information

 Competent authorities should have the power to obtain and provide information that is the
 subject of a request under an exchange of information arrangement from any person within
 their territorial jurisdiction who is in possession or control of such information (irrespective
 of any legal obligation on such person to maintain the secrecy of the information).


      141.    As regards access to information for the purpose of international
      exchange of information, the Belgian tax administration can invoke the very
      extensive information accessing powers granted to it by CIR 92. Pursuant to
      these powers, the Belgian authorities may compel taxpayers, third parties or
      other public authorities to provide them with all kinds of information.

      Obligation of taxpayers
      142.     Articles 315 and 315 (a) of CIR 92 state that the Belgian tax authori-
      ties may require taxpayers to provide accounts, documents, computerised
      data and information. Furthermore, pursuant to article 316 of the same code,
      every taxpayer is required to provide to the tax administration “all informa-
      tion that may be requested, for the purposes of verifying the taxpayer’s tax
      situation”.
      143.    The checks and requests for information can relate to all transactions
      to which the taxpayer has been party, and the information gathered as a result
      may also be used for the purposes of the taxation of third parties (article 317
      of CIR 92).



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       144.     Finally, article 319 of CIR 92 states that taxpayers are required to
       grant tax officials free access during all business hours to their professional
       or other premises in which activity is carried out, or presumed to be carried
       out. This is to enable the officials to determine the nature and scale of the
       activity concerned and to verify the existence, nature and quantity of goods
       and items of all kinds that these persons possess or keep on the premises as
       well as to examine all accounts and documents kept there.

       Obligations of third parties
       145.     Pursuant to article 322 of CIR 92, the administration may, with regard
       to a given taxpayer, hear third parties, undertake audits, and require natural per-
       sons or legal entities, as well as associations with no legal personality, to produce
       all information that the authorities deem necessary. When witnesses are heard,
       their testimony is given under oath pursuant to article 934 of the judicial code.
       The taxpayer is summoned to the hearing of witnesses (article 325 of CIR 92).
       146.     The production of this information may also be required in relation to
       “any person or group of persons, even when they are not identified by name”
       with whom the persons or entities questioned have dealt “directly or indi-
       rectly as a result of (their) transactions or activities” (article 323 of CIR 92).
       147.      State administrations (including the prosecuting authorities and the
       court registries which in Belgium are responsible for the registration of legal
       entities), the administrative authorities of political subdivisions and local authori-
       ties and other public bodies are obliged to provide all information in their pos-
       session when requested to do so by the tax authorities, and to let the authorities
       consult any item or document that may be needed for taxes to be levied correctly.
       In this situation, the examination of documents relating to judicial procedures is
       subject to the express authorisation of the federal prosecutor, the public prosecu-
       tor or the auditor-general (article 327, paragraphs 1 and 2, of CIR 92).

       Powers of investigation
       148.    When the information requested by a treaty partner is already in the
       Belgian tax administration’s possession, it can be exchanged without regard
       to any prescription period.
       149.     The authorities may undertake inspections, audits and the assessment
       of taxes or additional taxes, even where the taxpayer’s declaration has already
       been accepted and the taxes arising from it paid. Such inspections and audits
       may, pursuant to article 333, paragraphs 1 and 2 of CIR 92, be conducted
       during the taxable period (year in which income is earned) as well as during
       the three years following 1 January of the assessment year (year that follows
       the taxable period.).



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      150.    However, in cases in which fraud is suspected, these inspections and
      audits may also be conducted during the seven-year period beginning on 1
      January of the assessment year. In this case, the authorities have to inform the
      taxpayer beforehand about the reasons justifying the extension of the audit or
      inspection period. If this prior notification is not forthcoming, taxation will
      be rendered null and void (article 333, paragraph 3 of CIR 92).
      151.     In matters of international exchange of information, the Belgian
      administration interprets the provisions of its domestic law as allowing it to
      access information in case of tax avoidance during a seven year period on the
      simple provision, by the requesting partner, of the reasons for which access to
      information during a period greater than three years is necessary. Since this
      is a matter regarding the Belgian administration’s practices and the interpre-
      tation of its national tax legislation, the evaluation team is of the view that it
      should be subject to further scrutiny during the Phase 2 examination.
      152.     In addition to having the power to ask taxpayers and third parties
      to provide information upon request, any SPF Finances official, regularly
      responsible for carrying out an examination or an audit is lawfully authorised
      to take, seek or gather relevant and non-excessive appropriate information,
      which contributes to ensuring the assessment or collection of any other tax
      introduced by the state (article 335, paragraph 2, CIR 92).

      Ownership and identity information (ToR B.1.1)/ Accounting
      records (ToR B.1.2)
      153.    In order to obtain this information, the Belgian competent authority,
      or the Belgian administrative authority which it calls upon to gather the infor-
      mation, acts just as it would on its own initiative or at the request of another
      Belgian authority.
      154.     In this situation and in order to access information on the identity of
      persons involved in a legal entity or an arrangement established or admin-
      istered from Belgium, the Belgian tax authorities may invoke the measures
      in articles 315 and 322 of CIR 92 to ensure that the information requested is
      provided either directly by the taxpayer, or whoever is believed to be holding
      it. The same reasoning applies to the provision of accounting data.
      155.     As previously mentioned, according to the Belgian tax authorities,
      access to information is ensured during a period of seven years as long as the
      requesting party provides reasons for which the access to information during
      this period is necessary.
      156.    It should also be mentioned that in the Belgium-US tax treaty, it is
      expressly stated that, for the purposes of the Mutual Agreement Procedure,
      the Belgian authorities can access information outside the common three-year



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       Belgian time limit. The protocol signed with Germany on 21 January 2010
       also includes this provision16. This does not, however, apply in the context of
       the exchange of information article in any of Belgium’s treaties.

       Use of information gathering measures absent domestic tax interest
       (ToR B.1.3)
       157.      The concept of “domestic tax interest” describes situations in which
       a contracting party can only provide information to another contracting party
       if it has an interest in gathering this information for its own needs.
       158.     Belgian legislation contains nothing to restrict the use of domes-
       tic information-gathering powers to situations in which the information is
       required by the Belgian tax administration for its own use.

       Compulsory powers (ToR B.1.4)
       159.    Unanswered requests for information may result in administra-
       tive penalties pursuant to article 445 of CIR 92. Under this provision, any
       infringement of the provisions of CIR 92 or its implementing regulations,
       and thus any refusal to reply to a request for information from the Belgian
       authorities, is punishable by an administrative fine of EUR 50 to EUR 1 250.
       160.     Where the conditions are satisfied, criminal sentences may also be
       handed down (articles 449-463 of CIR 92). Under exceptional circumstances,
       a common law judicial procedure (for example, emergency interim proceed-
       ings) might be used when the regular procedure is ineffective in resolving
       the dispute within the required time period. In emergency situations, and
       in particular when the assessment period in the requesting state is at risk of
       expiring, the Belgian administration is likely to ask the president of the first
       instance tribunal to order the person to whom the request was made to pro-
       vide the requested information under emergency interim proceedings.
       161.     False testimony, a false declaration made by an interpreter or consult-
       ant, or a subornation of witnesses in one of the cases of enquiry authorised by
       articles 322 (request for information from third parties) or 325 (hearing of wit-
       nesses) is punishable, pursuant to the provisions of articles 220-224 in the Penal
       Code (article 451 of CIR 92), by imprisonment for two months to three years.
       162.    Failure to appear or refusal to testify in enquiries authorised by articles
       322, 325 and 374 of CIR 92 is also punishable by imprisonment for eight days
       to six months and/or a fine of EUR 125 to EUR 12 500 (article 452 of CIR 92).



16.    This protocol is not yet in force.


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      Secrecy provisions (ToR B.1.5)

      Bank confidentiality
      163.     Banking confidentiality in Belgium is not provided for in the
      Constitution or criminal law. The activity of bankers and, more generally, of
      all professions in the economic and financial sector, is not covered by profes-
      sional secrecy. For the Supreme Court of Appeal in Belgium, bankers are not
      subject to real professional secrecy but to what is customarily known as a
      “duty of discretion”. Thus bankers who disclose information gathered in the
      course of their professional activities are guilty of misconduct for which they
      may be held civilly but not criminally liable.
      164.    In reality, banking confidentiality in tax matters is provided for
      directly by article 318 of CIR 92, as an exception to the general principle
      of access to information by the tax authorities. However, this banking “dis-
      cretion” applies only to income tax, during the phase during which tax is
      assessed. Where other taxes such as VAT, inheritance tax, stamp taxes and
      customs and excise are concerned, this limitation does not exist.
      165.      The foregoing exception applies to any natural person or legal entity
      that is the “customer” of a bank or other financial institution in the business
      sense of the term, meaning that the person or entity concerned buys goods
      from the bank or financial institution or uses its services. Among such per-
      sons or entities therefore are those with a bank account, those that apply for
      government securities, buy or sell securities, rent a safety deposit box, pur-
      chase gold bullion or currencies, are granted credit or obtain a loan.
      166.    However, Belgian law provides for exceptions to the confidentiality
      principle:
              where concrete findings point to the existence or preparation of a tax
              fraud scheme ;
              in cases of taxpayer-requested adjustment;
              for purposes of tax recovery;
              if the banking information is in the taxpayer’s possession – with the
              exception of purely private accounts17 – or in the possession of per-
              sons other than banking institutions;
              within the scope of the EU savings directive for the purpose of auto-
              matic exchange of information.

17.   “Private” account: where taxpayers use a Belgian bank account exclusively for
      private purposes, the authorities are not entitled to demand documents relating
      to it.


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       167.    Belgian tax legislation contains no exception to the confidentiality
       principle when information is requested by foreign administrative authorities,
       including instances in which the relevant treaty provides very clearly for the
       exchange of banking information. Indeed, this matter is settled on a case-by-
       case basis in the laws that ratify the conventions.
       168.     Thus in the Belgian/US framework, the ratifying law contains provi-
       sions stating specifically that article 318 of CIR 92 will not be enforceable in
       the case of requests for information from the US tax authorities under arti-
       cle 25, paragraph 5 of the tax convention. In addition, circular AAF/97/380 of
       15 February 2008 published by SPF Finances specifies the conditions under
       which the request received will be processed by the Belgian authorities and
       how banking information may be obtained from the institutions possessing it.
       169.     To date, the Belgium-US convention constitutes the only reference in
       this area. However, the Belgian tax authorities have indicated that, in the case
       of the 40 other protocols and tax information exchange agreements (TIEAs)
       complying with the standard which have been signed to date, the ratifying
       law would contain a provision to the same effect as the one in the law approv-
       ing the Belgian/US tax convention.
       170.      Furthermore, it is also important to highlight that under the EU
       Savings Directive framework, Belgium is, since 2010, in a position to auto-
       matically exchange banking information concerning individuals receiving
       interest payments with its 26 EU counterparts (and the seven other countries18
       and jurisdictions that are parties to this agreement). The domestic provisions
       providing for this possibility were implemented in 2009 in Belgian domes-
       tic tax law. This means that Belgium can exchange upon request banking
       information with one jurisdiction (the United-States). In addition Belgium
       can automatically exchange some banking information with the jurisdictions
       involved in the exchanges organised by the EU Savings Directive         a n d
       related agreements.

       Accountants’ privilege
       171.     Article 58, paragraph 3 of the April 22, 1999 law on the accounting
       and tax professions provides that Article 458 of the criminal code, which
       deals with professional secrecy, applies to accountants and certified public
       accountants. However, when the tax authorities examine the tax situation of
       the accountant’s client, the accountant must provide the tax authorities with
       all the books and records and other information necessary for the purposes of
       determining the client’s taxable income. Only the information provided to the

18.    Aruba, British Virgin Islands, Guernsey, Isle of Man, Jersey, Montserrat, and
       Netherlands Antilles,


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      accountant on a confidential basis cannot be provided to the tax authorities.
      An accountant can take advantage of professional secrecy with respect to the
      information given by his client in secret, but this is subject to five exceptions:
          When the client expressly allows the accountant to disclose the informa-
      tion ;
          When the accountant himself/herself is under a criminal investigation;
          When the accountant is on trial with his/her ex-client;
          When the accountant is faced with a situation of necessity;
          When the law requires the accountant to disclose his secrets (for example,
      in the case of money laundering), or when the accountant is summoned to
      provide testimony in court or before a parliamentary enquiry commission.
      172.    When a person subject to professional regulation refuses to provide
      certain documents or oral information on the basis of professional secrecy,
      the tax authorities must seek the intervention of the competent disciplinary
      authority who will determine whether the information is covered by profes-
      sional secrecy, and if necessary, the conditions pursuant to which the infor-
      mation can or cannot be disclosed (Article 334 of CIR 92).
      173.    The Belgium authorities have advised that the accountant privilege
      has never hindered the access to information for assessment of tax. The extent
      of this privilege and its interactions with EOI will be further considered
      during the phase 2 review of Belgium.

                Determination and factors underlying recommendations

                                           Conclusion
      The element is not in place.
              Factors underlying the                         Recommendations
                recommendations
      The Belgian tax authorities do               Belgium should ensure that its
      not have any access to banking               authorities have access to banking
      information in the field of direct           information for the purposes of
      taxation.                                    exchange of information in the field of
                                                   direct taxation.




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B.2. Notification requirements and rights and safeguards

 The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the
 requested jurisdiction should be compatible with effective exchange of information.



       Not unduly prevent or delay exchange of information (ToR B.2.1.)
       174.     CIR 92 does not contain any provisions requiring the tax authorities
       to notify a taxpayer about whom information is requested.

                  Determination and factors underlying recommendations

                                             Conclusion
       The element is in place.




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C. Exchanging Information



Overview

       175.     Jurisdictions generally cannot exchange information for tax purposes
       unless they have a legal basis or mechanisms for doing so. In Belgium, the legal
       authority to exchange information is derived from bilateral mechanisms (double
       tax conventions) as well as domestic law. This section of the report examines
       whether Belgium has a network of information exchange arrangements that
       would allow it to achieve the effective exchange of information in practice.
       176.     Belgium has a vast network of agreements including provisions on
       the exchange information for tax purposes. To date, 112 agreements have
       been signed but only one conforms to the standard. Belgium has embarked
       on an extensive drive to reform its treaties in order to bring them up to the
       international standard of transparency. Since making its commitment to this
       standard in 2009, Belgium has already signed 40 treaties and initialled 24
       others. 60 letters proposing negotiations have also been sent. The speed with
       which these negotiations have been conducted is firmly emphasised even
       though Belgium now has to ensure that such agreements can enter into force
       quickly, which at present is not the case for any of them.
       177.     Indeed and with reference to the situation discussed in section B.1.,
       Belgium is not in a position to exchange information held by financial insti-
       tutions for the purposes of the assessment of income taxes, since it lacks any
       clear provision to this effect in its treaties. Apart from the convention with
       the United States, no convention signed with Belgium allows, as yet, the
       exchange of banking information.
       178.    All mechanisms for exchanging information include provisions con-
       cerned with confidentiality, and Belgian domestic legislation also contains
       provisions on this subject. These provisions apply in exactly the same way to
       the information and documents comprising any request received by Belgium,
       as they do to the replies actually forwarded to the treaty partner.




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      179.     Each of the treaties entered into by Belgium guarantees that the par-
      ties involved will not be obliged to reveal information regarding an industrial,
      business or professional secret, or information subject to attorney-client privi-
      lege, or to disclose information that would be contrary to public order.
      180.    Finally and although this is a matter that will be assessed during the
      phase 2 review, there is no restriction in Belgian domestic legislation that
      might limit Belgium’s ability to exchange information within the 90-day
      period stipulated by the international standards.

C.1. Information exchange mechanisms

 Exchange of information mechanisms should allow for effective exchange of information.


      181.    Belgium has signed 112 agreements which provide for the exchange
      of information. This includes the 13 TIEAS signed since March 2009.
      182.    As a member of the European Union, Belgium is involved in the
      European common VAT system and as a consequence in the VAT exchange
      of information that takes place under the EU regulation (EC) 1798/200319.
      Belgium is also involved in exchanging information automatically. This takes
      place under the scope of the EU Savings Directive 48/2003/EC pursuant to
      which EU members (with the exception of Austria and Luxemburg), as well
      as other jurisdictions that are party to agreements20, exchange data on an
      annual basis concerning the savings income received from Belgium paying
      agents by taxpayers located abroad. Automatic exchanges also take place
      under the DTCs signed by Belgium or the EU Mutual Assistance Directive
      on a reciprocal basis.

      Foreseeably relevant standard (ToR C.1.1)
      183.     The international standard in information exchange assumes that
      information should be exchanged upon request to the widest possible extent.
      However, it does not allow “fishing expeditions”, meaning speculative
      requests for information which appear to have no clear link with an ongoing
      audit or investigation. The balance between these two competing aspects is
      expressed in the concept of “foreseeable relevance” contained in paragraph 1
      of article 26 of the OECD Model Tax Convention, which states the following:

19.   A new regulation (EC) 904/2010 was adopted by the European Council on 14
      October 2010 and will enter into force on 1 January 2012.
20.   Aruba, British Virgin Islands Guernsey, Isle of Man, and Montserrat and the
      Netherlands Antilles.


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                “The competent authorities of the Contracting States shall
                exchange such information as is foreseeably relevant for carry-
                ing out the provisions of this Convention or to the administration
                or enforcement of the domestic laws concerning taxes of every
                kind and description imposed on behalf of the Contracting States,
                or of their political subdivisions or local authorities, insofar as
                the taxation thereunder is not contrary to the Convention. The
                exchange of information is not restricted by Articles 1 and 2.”
       184.    Most of the treaties signed by Belgium contain the terms “necessary”,
       “relevant” or “foreseeably relevant”. The commentary on article 26 of the
       OECD Model Convention considers that the terms “necessary” or “relevant”
       mean the same thing for the exchange of information as the expression “fore-
       seeably relevant”. Thus most treaties entered into by Belgium can be recog-
       nised as complying with the standard of transparency.
       185.   It is noted that the tax convention concluded with the former
       USSR on 17 December 1987, which is still in force for relationships with
       Turkmenistan, Kyrgyzstan, Moldova, and Tajikistan, does not contain any
       information exchange mechanisms.

       In respect of all persons (ToR C.1.2)
       186.     Effective information exchange presupposes that the obligation of a
       jurisdiction to provide information should not be limited by the residence or
       nationality of either the person to whom the requested information relates, or
       the person who possesses or holds the information requested. For this reason,
       the international standard in information exchange states that the mechanisms
       for exchange can permit an exchange of information concerning all persons.
       187.     Aside from the treaty concluded with the former USSR which
       covers Turkmenistan, Kyrgyzstan, Moldova and Tajikistan (see above), all
       of Belgium’s treaties contain measures providing for the exchange of infor-
       mation about any person. None of the information exchange mechanisms
       restricts the scope of information exchange to just some persons, such as, for
       example, those that are considered residents of one of the two states.

       Obligation to exchange all types of information (ToR C.1.3)
       188.    Jurisdictions cannot undertake effective information exchange if they
       are unable to exchange information which is held by financial institutions,
       nominees or persons acting in an agency or a fiduciary capacity, or because
       the information relates to ownership interests in a person.




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     189.    Article 26 (5) of the OECD Model Convention provides that a con-
     tracting state may not decline to supply information solely because it is
     held by a bank, other financial institution, nominee or person acting in an
     agency or a fiduciary capacity, or because it relates to ownership interests
     in a person. Only the treaty between Belgium and the United States of 27
     November 2006, which came into force on 28 December 2007, contains a
     corresponding provision.
     190.      Since making its commitment to the international standard in trans-
     parency in 2009, Belgium has entered into new treaties with China, the Isle of
     Man and the Former Yugoslav Republic of Macedonia (FYROM). Article 26
     (5) of the treaty with China contains a reference to banks and other financial
     institutions, but does not include the reference to nominees, persons acting in an
     agency or a fiduciary capacity, and information relating to ownership interests.
     While the treaty with the Isle of Man contains a corresponding article 26 (5), it
     also stipulates that “If the request does not identify both a specific taxpayer and
     a specific bank or financial institution, the competent authority of the requested
     party may decline to obtain information that it does not already possess.”
     191.     Besides these new treaties, Belgium has negotiated 24 protocols with
     the following countries, in order to introduce information exchange provi-
     sions that comply with the standard: Germany, Australia, Austria, Bahrain,
     Congo, Korea, Denmark, Spain, Finland, France, Greece, Iceland, Japan,
     Luxembourg, Malaysia, Malta, Norway, the Netherlands, the Czech Republic,
     the United Kingdom, Rwanda, San Marino, Seychelles and Singapore.
     192.    On 7 December 2009, however, Belgium concluded a protocol to its
     existing treaty with New Zealand, signed on 15 September 1981, which does
     not contain an update to the information exchange article. This protocol,
     negotiated before Belgium’s formal commitment to the international standard,
     was the subject of a new amending protocol signed on 10 June 2010.
     193.   Belgium has additionally concluded 13 information exchange agree-
     ments that all include provisions complying with article 5 (4) of the OECD
     Model TIEA, which requires the contracting parties to exchange all types of
     information.
     194.     Finally, according to the information publicly available on the SPF
     Finances website, Belgium has initialled 24 other protocols containing provi-
     sions equivalent to paragraph 5 of article 26 of the OECD Model Convention
     or the OECD Model TIEA, over and above the 40 agreements concluded
     since 2009. In addition, Belgium has sent 60 letters proposing negotiations of
     protocols conforming to the international standard of exchange of informa-
     tion to current and prospective partners.
     195.    The 40 agreements signed by Belgium over the last 18 months means
     that Belgium is now party to 41 treaties that comply with article 26 (5) of the


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       OECD Model Convention. However, only the treaty with the United States
       is as yet in force. Belgium should therefore continue to strive to bring all its
       treaties still not providing for the exchange of banking information into line
       with the international standard.

       Absence of domestic tax interest (ToR C.1.4)
       196.      The concept of domestic tax interest describes situations in which a
       contracting party can only provide information to another contracting party
       if it has an interest in obtaining the desired information for its own tax pur-
       poses. Inability to provide information which is based on any such domestic
       tax interest does not comply with the international standard. The contracting
       parties should use domestic information-gathering powers, even if these are
       used solely for the purpose of obtaining and providing information for the
       other contracting party.
       197.    The 27 protocols and conventions signed by Belgium since 2009
       contain article 26 (4) of the OECD Model Convention, requiring that the
       contracting parties use their information-gathering powers to exchange
       the required information without any reference to a domestic tax interest.
       Furthermore, the 2006 convention between Belgium and the United States
       includes this provision. The 13 information exchange agreements reached by
       Belgium also contain this provision.
       198.    Belgium is, however, in a position to exchange information with its
       treaty partners in situations in which it has no domestic tax interest, even
       without the reference to Article 26(4) of the OECD Model Convention.

       Absence of dual criminality principles (ToR C.1.5)
       199.    The dual criminality principle states that assistance can only be pro-
       vided if the matter under investigation (and prompting the request for infor-
       mation) would constitute a criminal matter in the requested country if it had
       arisen in that country. If it is to be meaningful, information exchange must
       not be restricted by the enforcement of a dual criminality principle.
       200.     None of information exchange mechanisms established by Belgium
       provide for the application of the dual criminality principle.




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     Exchange of information in both civil and criminal tax matters
     (ToR C.1.6)
     201.   Communicating information may be necessary for both tax and
     criminal purposes. The international standard is not limited to exchanges of
     information for criminal purposes and may also include exchanges for tax
     purposes.
     202. All information exchange mechanisms concluded by Belgium provide
     for the exchange of information for both criminal and civil matters.

     Provide information in the specific form requested (ToR C.1.7)
     203.    There are no restrictions in the information exchange mechanisms
     concluded by Belgium that might prevent it from providing information in the
     form requested, as long as this is consistent with its administrative practices.

     In force (ToR C.1.8)
     204. The exchange of information cannot occur unless a jurisdiction has
     information exchange mechanisms in force. Where such mechanisms have
     been signed, the international standard requires a jurisdiction to complete the
     measures needed for them to take effect.
     205.    Belgium has information exchange agreements with 112 countries.
     Only one agreement complying with the international standard – the one
     concluded with the United States in 2006 – is currently in force. Out of the
     40 other agreements signed by Belgium since 2009, 12 have been approved
     by the Council of Ministers. None of these agreements has been examined
     by the Belgian Parliament. In fact, the Belgian Council of State has recently
     decided that tax treaties are “mixed treaties”, that is to say, treaties that come
     within the jurisdiction of the federal state and one or more federated enti-
     ties (Regions and/or Communities). Treaties signed and/or initialled by the
     Belgian federal authorities must from now on be the subject of consultations
     with the federated entities before they can be signed and approved. In any
     case, a mixed treaty must receive assent not only from the federal Parliament
     but also from the parliaments of the regions and/or communities concerned.
     The process of ratification of international treaties is thereby protracted (see
     annex 3 where the list of all agreements signed by Belgium since its commit-
     ment to the standard can be seen).
     206. As Belgium cannot rely on its domestic legislation to exchange every
     kind of information, and in particular banking information, it is important for
     the country to find ways of speeding up the entry into force of newly signed
     agreements, so that it will have a network of information exchange mecha-
     nisms which complies with the international standard as soon as possible.


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       In effect (ToR C.1.9)
       207.    In order for information exchange to be effective, the contracting par-
       ties have to take the necessary measures to comply with their commitments.
       208. The absence of any provision for gaining access to banking infor-
       mation in Belgian domestic legislation prevents Belgium from complying
       with its international commitments in treaties that incorporate the interna-
       tional standard in transparency, unless special provisions supplement those
       treaties.
       209.     Thus, within the Belgian/US framework, the law approving the
       convention includes the provisions required for the Belgian authorities to be
       able to access banking information. If no generic measure is incorporated in
       Belgian domestic law, it will be necessary, in order to give effect to the other
       agreements complying with the standard to include similar provisions for
       each of the agreements signed by Belgium.

                  Determination and factors underlying recommendations

                                             Conclusion
       The element is not in place.
                Factors underlying the                          Recommendations
                  recommendations
       Only one of Belgium’s treaties                 The Belgian authorities should
       providing for the exchange of banking          include provisions enabling the
       information for the purposes of                exchange of banking information in
       assessing income taxes is in force.            their information exchange arrange-
       The other 40 agreements that provide           ments with relevant partners. These
       for this exchange are not yet in force.        treaties should be ratified quickly in
                                                      order for them to have effect.


C.2. Exchange-of-information mechanisms with all relevant partners
        The jurisdictions’ network of information exchange mechanisms should cover
        all relevant partners.

       210.    Belgium possesses a vast network of information exchange agree-
       ments now covering 112 jurisdictions.21 The following table shows the
       number of jurisdictions with which Belgium has an agreement complying
       with the international standard in transparency.


21.    91 of these 112 agreements are in force. See the list in Annex 2.



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                          Number of Agreement in line with the standard    Lack of
        Group of         jurisdictions                                  agreement to
      jurisdictions      in the group Convention Protocol       TIEA    the standard
 Bordering countries             422            0              4              0                 0
 EU                            26               0             12              0               14
 EEA                             3              0              2              1                 0
 G20                           19               2              6              0                1123
 OECD                          32               1             16              0               1524
 Global Forum                  93               2             22             13               56


        211.     Thus, as the table shows, Belgium’s four neighbouring countries, 12
        EU countries including the main economies, and 17 OECD member countries
        now have an agreement with Belgium complying with the international stand-
        ard in transparency.
        212.    Furthermore, the Belgian tax authorities have published the schedule
        for negotiating protocols and TIEAs that meet the OECD standard on infor-
        mation exchange on their website. According to the website and in addition
        to the 41 agreements that already comply with the international standard,
        40 of which have been signed in 18 months, Belgium has initialled 24 other
        agreements, while 60 letters have been sent to other partners inviting them to
        amend an existing treaty or enter into a tax information exchange agreement.
        213.    Thus despite the fact that two-thirds of the treaties concluded by
        Belgium have still not been brought into line with the standard, the extensive
        work done by the country since March 2009 by the signing of amending
        protocols should be acknowledged. Through its extensive policy of conclud-
        ing agreements respecting the international standard in transparency and
        exchange of information, Belgium has demonstrated the level of its commit-
        ment to the international standard. The work undertaken must be continued
        and concluded so that all Belgium’s partners, if they so desire, can have an
        information exchange agreement providing for coverage of the full range of
        information that should be exchangeable.




22.     France, Germany, Luxembourg and the Netherlands.
23.     Argentina, Brazil, Canada, India, Indonesia, Italy, Mexico, Russia, Saudi Arabia,
        South Africa and Turkey.
24.     Canada, Chile, Hungary, Ireland, Israel, Italy, Mexico, New Zealand, Poland,
        Portugal, Slovakia, Slovenia, Sweden, Switzerland and Turkey.


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                                   COMPLIANCE WITH THE STANDARDS: EXCHANGING INFORMATION – 59



                    Conclusion and factors underlying recommendations

                                             Conclusion
       The element is in place but certain aspects of the legal implementation
       of the element need improvement.
                Factors underlying the                          Recommendations
                  recommendations
       On the 41 treaties to the standard             Belgium should continue to develop
       signed by Belgium, only one is                 its EOI network to the standard
       currently in force.                            with all relevant partners and ratify
                                                      the agreements already signed
                                                      expeditiously.


C.3. Confidentiality
        The jurisdictions’ mechanisms for exchange of information should have adequate
        provisions to ensure the confidentiality of information received.

       Information received: disclosure, use and safeguards (ToR C.3.1)
       214.     Governments could not become involved in exchanging information
       without being certain that the details communicated will be used solely for
       the purposes specified in the relevant information exchange agreement, and
       that they will be kept confidential. Information exchange mechanisms should
       thus contain provisions indicating exactly the persons to whom the informa-
       tion may be circulated. Furthermore, the domestic legislation in force in the
       countries concerned usually contains strict regulations on protecting the
       confidentiality of information gathered for tax purposes.
       215.     All treaties signed by Belgium contain provisions relating to confi-
       dentiality which are based on the terms of article 26 (2) of the OECD Model
       Convention. All TIEAs signed by Belgium contain provisions relating to
       confidentiality which comply with the terms of article 8 of the OECD TIEA
       Model.
       216.     Furthermore, article 337 of CIR 92 deals with professional secrecy
       and provides that all persons involved in the enforcement of tax laws or
       who have access to the offices of the tax authorities must maintain absolute
       secrecy with regard to any information which they may have been able to
       consult in the course of their duties. However, they may pass on to other gov-
       ernment departments, including the prosecuting authorities and court regis-
       tries, as well as to the Communities, the Regions and public institutions, the
       information which these departments, entities and institutions need in order
       to discharge their responsibilities.


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     217.     Failure to comply with the rules of professional secrecy set out in
     article 337 is punishable, pursuant to the provisions of article 458 of the Penal
     Code, by imprisonment for eight days to six months and a fine from EUR 100
     to EUR 500.

     All other information exchanged (ToR C.3.2)
     218.     The provisions concerning confidentiality which are included both in
     the relevant agreements and in Belgian domestic legislation do not distinguish
     between information received in reply to a request or information that forms
     part of the request. These provisions apply in the same manner to requests,
     attached documents, and all communications between the jurisdictions
     involved in the exchange.

               Determination and factors underlying recommendations

                                         Conclusion
      The element is in place.


C.4. Rights and safeguards of taxpayers and third parties
       Information exchange mechanisms should respect the rights and safeguards
       of taxpayers and third parties.

     Exceptions to the requirement to provide information (ToR C.4.1)
     219.     All the information exchange arrangements to which Belgium is
     committed ensure that the parties concerned will not be required to supply
     information that would involve disclosure of an industrial, commercial or
     professional secret, information that might be subject to attorney-client privi-
     lege or information the disclosure of which would be contrary to public policy
     (ordre public).

               Determination and factors underlying recommendations

                                         Conclusion
      The element is in place.




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                                   COMPLIANCE WITH THE STANDARDS: EXCHANGING INFORMATION – 61



C.5. Timeliness of responses to requests for information
        The jurisdiction should provide information under its network of agreements
        in a timely manner.

       Response within 90 days (ToR C.5.1)
       220.     There is no provision in Belgian legislation or in its information
       exchange arrangements concerning responses or time limits within which
       replies must be provided. There is no restriction as such concerning the abil-
       ity of the Belgian competent authorities to respond to requests within 90 days
       of receiving them, either by supplying the information requested, or indicat-
       ing what stage the processing of the request has reached.

       Organisational process and resources (ToR C.5.2)
       221.     The central departments of SPF Finances, and more specifically
       Directorate III 1A, act as the competent authority in processing requests
       for information received from other jurisdictions. The organisation of this
       Directorate and its links with local Belgian services responsible for gathering
       information will be examined more closely during the phase 2 review.

       Absence of restrictive conditions on exchange of information
       (ToR C.5.3)
       222. There is no provision in Belgian legislation or in its information
       exchange agreements that sets out clear conditions governing the exchange
       of information, other than those included in article 26 of the OECD Model
       Convention or the OECD Model TIEA.

                  Determination and factors underlying recommendations

                                             Conclusion
       The assessment team is not in a position to evaluate whether this
       element is in place, as it involves issues of practice that are dealt with in
       the Phase 2 review.




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             Summary of Determinations and Factors
                Underlying Recommendations


       Conclusions                 Factors underlying the                  Recommendations
                                     recommendations
 Jurisdictions should ensure that ownership and identity information for all relevant entities
 and arrangements is available to their competent authorities. (ToR A.1.)
 The element is in             Under Belgian legislation, the        The Belgian authorities
 place, but certain            conversion of bearer shares           should examine the conditions
 aspects of the legal          into electronic or registered         under which mechanisms
 implementation of             shares will be completed by           to encourage conversion
 the element need              December 31, 2013.                    of bearer shares can be
 improvement.                                                        strengthened so that the
                                                                     information regarding their
                                                                     holders is available as quickly
                                                                     as possible.
 Jurisdictions should ensure that reliable accounting records are kept for all relevant entities
 and arrangements. (ToR A.2.)
 The element is in place.
 Banking information should be available for all account holders. (ToR A.3.)
 The element is in place.
 Competent authorities should have the power to obtain and provide information that is the
 subject of a request under an exchange of information arrangement from any person within
 their territorial jurisdiction who is in possession or control of such information (irrespective
 of any legal obligation on such person to maintain the secrecy of the information). (Tor B.1.)
 The element is not in         The Belgian tax authorities           Belgium should ensure that
 place.                        do not have any access to             its authorities have access
                               banking information in the field      to banking information for
                               of direct taxation.                   the purposes of exchange of
                                                                     information in the field of direct
                                                                     taxation.




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64 – SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS

      Conclusions              Factors underlying the                  Recommendations
                                 recommendations
The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the
requested jurisdiction should be compatible with effective exchange of information. (ToR B.2.)
The element is in place.
Information exchange mechanisms should provide for effective exchange of information.
(ToR C.1.)
The element is not in      Only one of Belgium’s treaties        The Belgian authorities should
place.                     providing for the exchange of         include provisions enabling
                           banking information for the           the exchange of banking infor-
                           purposes of assessing income          mation in their information
                           taxes is in force. The other 40       exchange arrangements with
                           agreements that provide for           relevant partners. These trea-
                           this exchange are not yet in          ties should be ratified quickly in
                           force.                                order for them to have effect.
The jurisdictions’ network of information exchange mechanisms should cover all relevant
partners. (ToR C.2.)
The element is in          On the 41 treaties to the             Belgium should continue to
place but certain          standard signed by Belgium,           develop its EOI network to
aspects of the legal       only one is currently in force.       the standard with all relevant
implementation of                                                partners and ratify the
the element need                                                 agreements already signed
improvement.                                                     expeditiously.
The information exchange mechanisms of jurisdictions should have adequate provisions to
ensure the confidentiality of information received. (ToR C.3.)
The element is in place.
Information exchange mechanisms should respect the rights and safeguards of taxpayers
and third parties. (ToR C.4.)
The element is in place.
The jurisdiction should provide information under its network of agreements in a timely
manner. (ToR C.5.)
The assessment team
is not in a position to
evaluate whether this
element is in place, as
it involves issues of
practice that are dealt
with in the Phase 2
review




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                                                                                     ANNEXES – 65




    Annex 1: The Jurisdiction’s Response to the Peer Review*


           Belgium would like to express its gratitude and appreciation for the hard
       work done by the assessment team in evaluating the Belgian legal and regula-
       tory framework. The evaluation took place in a cordial atmosphere of mutual
       understanding and cooperation.
            Belgium acknowledges that the Belgian legal and regulatory framework
       still contains some important deficiencies and will give serious consideration
       to the recommendations included in the report.
            Of course, Belgium regrets that the final conclusions of the report have
       to focus on the access to and the exchange of banking information in the field
       of the assessment of direct taxes and cannot take into account the following
       specificities:
                Belgian domestic law allows access to information held by banks for
                the assessment and collection of VAT, registration duties, inheritance
                taxes, as well as customs and excise duties;
                as a signatory to the joint Council of Europe/OECD Convention on
                mutual assistance in tax matters, Belgium is able to exchange infor-
                mation held by banks in the field of all indirect taxes covered by the
                Convention and of the collection of direct taxes;
                Belgian domestic law allows access to information held by banks for
                the collection of income taxes and, when there exists a presumption
                of fraud, for the assessment of income taxes;
                Belgium automatically exchanges information with the 33 jurisdic-
                tions that are party to the Savings Directive (EU Council Directive
                2003/48/EC).
           As the report is based on information available in November 2010,
       Belgium would like to highlight the following recent development with regard


       * This Annex presents the Jurisdiction’s response to the review report and shall
       not be deemed to represent the Global Forum’s views.


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66 – ANNEXES

     to the access to banking information for the purpose of the assessment of
     income taxes:
               on 3 March 2011 the Finance and Budget Commission of the Belgian
               Parliament approved a bill which, as from 1 July 2011, will allow the
               access to banking information for the purpose of assessing income
               taxes. This modification of its domestic law will allow Belgium to
               provide information held by banks to all states with which Belgium
               has an agreement in force providing for the exchange of informa-
               tion (DTA, TIEA or other international instrument), irrespective of
               whether or not that provision specifically prescribes the exchange of
               banking information. When the new provision is in force, Belgium
               will be able to exchange banking information with more than
               90 existing treaty partners.


         Jacques GOMBEER
         Auditor general




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                                                                                     ANNEXES – 67




      Annex 2: List of all Information Exchange Mechanisms
                               in Force



Multilateral agreements

       Belgium is a party to the:
                Council of Europe and OECD Convention on Mutual Administrative
                Assistance in Tax Matters, which is currently in force with respect
                to 14 jurisdictions: Azerbaijan, Belgium, Denmark, Finland, France,
                Iceland, Italy, the Kingdom of the Netherlands, Norway, Poland,
                Sweden, the Ukraine, the United Kingdom and the United States25.
                EU Council Directive 77/799/EEC of 19 December 1977 (as amended)
                concerning mutual assistance by the competent authorities of the Member
                States in the field of direct taxation and taxation of insurance premiums.
                This Directive came into force on 23 December 1977 and all EU mem-
                bers were required to transpose it into national legislation by 1 January
                1979. The current EU members, covered by this Council Directive, are:
                Austria, Belgium, Bulgaria, Cyprus,26,27 Czech Republic, Denmark,
                Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy,
                Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal,
                Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.

25.    Canada, Germany and Spain have signed the Convention and are awaiting ratification.
26.    Note by Turkey: The information in this document with reference to “Cyprus”
       relates to the southern part of the Island. There is no single authority represent-
       ing both Turkish and Greek Cypriot people on the Island. Turkey recognises the
       Turkish Republic of Northern Cyprus (TRN C). Until a lasting and equitable
       solution is found within the context of the United Nations, Turkey shall preserve
       its position concerning the “Cyprus issue”.
27.    Note by all the European Union Member States of the OE CD and the European
       Commission: The Republic of Cyprus is recognised by all members of the United
       Nations with the exception of Turkey. The information in this document relates to
       the area under the effective control of the Government of the Republic of Cyprus.


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                   EU Council Directive 2003/48/EC of 3 June 2003 on taxation of
                   savings income in the form of interest payments. This Directive
                   aims to ensure that savings income in the form of interest payments
                  generated in an EU member state in favour of individuals or residual
                  entities being resident of another EU member state are effectively
                  taxed in accordance with the fiscal laws of their state of residence. It
                  also aims to ensure exchange of information between member states.
           bogus for note 2828

                                           Bilateral agreements

                     Jurisdiction            Type of EoI          Date Signed          Date Entered
                                            Arrangement                                 Into Force
      1     Albania                               DTC              14-11-2002           01-09-2004
      2     Algeria                               DTC              15-12-1991           10-01-2003
      3     Argentina                             DTC              12-06-1996           22-07-1999
      4     Armenia                               DTC              07-06-2001           01-10-2004
      5     Australia                             DTC              13-10-1977            01-11-1979
      6     Austria                               DTC              29-12-1971           28-06-1973
      7     Azerbaijan                            DTC              18-05-2004           12-08-2006
      8     Bangladesh                            DTC              18-10-1990           09-12-1997
      9     Belarus                               DTC              07-03-1995           13-10-1998
      10    Bosnia-Herzegovina                    DTC              21-11-1980           26-05-1983
      11    Brazil                                DTC              23-06-1972           13-07-1973
      12    Bulgaria                              DTC              25-10-1988            28-11-1991
      13    Canada                                DTC              23-05-2002           06-10-2004
      14    Chile                                 DTC              06-12-2007           05-05-2010
      15    China                                 DTC              18-04-1985           11-09-1987
      16    Croatia                               DTC              31-10-2001           01-04-2004
      17    Cyprus28                              DTC              14-05-1996           08-12-1999
      18    Czech Republic                        DTC              16-12-1996           24-07-2000
      19    Denmark                               DTC              16-10-1969            31-12-1970
      20 Egypt                                    DTC              03-01-1991           03-03-1997
      21    Ecuador                               DTC              18-12-1996           18-03-2004
      22 Estonia                                  DTC              05-11-1999           10-07-2003
      23 Finland                                  DTC              18-05-1976            27-12-1978
      24    France                                DTC              10-03-1964           17-06-1965


28.        See notes 26 and 27.


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                                                                                          ANNEXES – 69



                 Jurisdiction             Type of EoI          Date Signed           Date Entered
                                         Arrangement                                  Into Force
   25 FYROM                                   DTC               21-11-1980           20-05-1983
   26 Gabon                                   DTC               14-01-1993           13-05-2005
   27 Georgia                                 DTC               14-12-2000           04-05-2004
   28 Germany                                 DTC               11-04-1967            30-07-1969
   29 Ghana                                   DTC               14-06-2005            17-10-2008
   30 Greece                                  DTC               25-05-2004            30-12-2005
   31   Hong Kong, China                      DTC               10-12-2003            07-10-2004
   32 Hungary                                 DTC               19-07-1982            25-02-1984
   33 Iceland                                 DTC               23-05-2000           19-06-2003
   34 India                                   DTC               26-04-1993            01-10-1997
   35 Indonesia                               DTC               16-09-1997            07-11-2001
   36 Ireland                                 DTC               24-06-1970            31-12-1973
   37   Israel                                DTC               13-07-1972            04-11-1975
   38 Italy                                   DTC               19-04-1983            29-07-1989
   39 Ivory Coast                             DTC               25-11-1977            30-12-1980
   40 Japan                                   DTC               28-03-1968            16-04-1970
   41   Kazakhstan                            DTC               16-04-1998           13-04-2000
   42   Kirghizstan                           DTC               17-12-1987            08-01-1991
   43 Kosovo                                  DTC               21-11-1980           20-05-1983
   44 Kuwait                                  DTC               10-03-1990            28-10-2000
   45 Latvia                                  DTC               21-04-1999            07-05-2003
   46 Lithuania                               DTC               26-11-1998           05-05-2003
   47   Luxemburg                             DTC               17-09-1970            30-12-1972
   48 Malaysia                                DTC               24-10-1973            14-08-1975
   49 Malta                                   DTC               28-06-1974            03-01-1975
   50 Mauritius                               DTC               04-07-1995            28-01-1999
   51   Mexico                                DTC               24-11-1992            01-02-1997
   52   Moldavia                              DTC               17-12-1987            08-01-1991
   53 Mongolia                                DTC               26-09-1995           30-03-2000
   54 Montenegro                              DTC               21-11-1980           20-05-1983
   55 Morocco                                 DTC               04-05-1972            05-03-1975
   56 Nigeria                                 DTC               20-11-1989            27-10-1994
   57 The Netherlands                         DTC               05-06-2001            31-12-2002
   58 New Zealand                             DTC               15-09-1981            08-12-1983
   59 Norway                                  DTC               14-04-1988            04-10-1991




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70 – ANNEXES

               Jurisdiction             Type of EoI          Date Signed          Date Entered
                                       Arrangement                                 Into Force
  60 Pakistan                                DTC              17-03-1980           02-09-1983
  61   Philippines                           DTC              02-10-1976           09-07-1980
  62 Poland                                  DTC              20-08-2001           29-04-2004
  63 Portugal                                DTC              16-07-1969           19-02-1971
  64 Romania                                 DTC              04-03-1996            17-10-1998
  65 Russia                                  DTC              16-06-1995           26-06-2000
  66 Rwanda                                  DTC              16-04-2007           06-07-2010
  67 San Marino                              DTC              21-12-2005           25-06-2007
  68 Senegal                                 DTC              29-09-1987           04-02-1993
  69 Serbia                                  DTC              21-11-1980           26-05-1983
  70   Singapore                             DTC              06-11-2006            27-11-2008
  71   Slovak Republic                       DTC              15-01-1997           13-06-2000
  72 Slovenia                                DTC              22-06-1998           02-10-2002
  73   Sri Lanka                             DTC              03-02-1983           12-06-1985
  74   South Africa                          DTC              01-02-1995           10-10-1998
  75   South Korea                           DTC              29-08-1977           19-09-1979
  76   Spain                                 DTC              14-06-1995           25-06-2003
  77 Sweden                                  DTC              05-02-1991           24-02-1993
  78   Switzerland                           DTC              28-08-1978           26-09-1980
  79 Taiwan                                  DTC              13-10-2004           14-12-2005
  80 Tajikistan                              DTC              17-12-1987           08-01-1991
  81   Thailand                              DTC              16-10-1978           28-12-1980
  82 Tunisia                                 DTC              07-10-2004           05-06-2009
  83 Turkey                                  DTC              02-06-1987           08-10-1991
  84 Turkmenistan                            DTC              17-12-1987           08-01-1991
  85 Ukraine                                 DTC              20-05-1996           25-02-1999
  86 United Arab Emirates                    DTC              30-09-1996           06-01-2004
  87   United Kingdom                        DTC              01-06-1987           21-10-1989
  88 United States                           DTC              27-11-2006           28-12-2007
  89 Uzbekistan                              DTC              14-11-1996           08-07-1999
  90 Venezuela                               DTC              22-04-1993            13-11-1998
  91   Viet Nam                              DTC              28-02-1996           25-06-1999




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     Annex 3: List of all Information Exchange Mechanisms
    to the Standard Signed by Belgium since its Commitment


        Agreements signed by Belgium since March 2009 and awaiting ratification
                                                DTA                                  Approved by
                                                                                      Council of
            Jurisdiction                 New     Protocol     TIEA        Signed      Ministers
Germany                                                                21-01-2010
Andorra                                                                23-10-2009
Antigua and Barbuda                                                     07-12-2009
Australia                                                              24-06-2009
Austria                                                                10-09-2009
Bahamas                                                                 07-12-2009
Bahrain                                                                23-11-2009
Belize                                                                 29-12-2009
China (République populaire de)                                        07-10-2009
Congo                                                                  16-07-2010
Korea                                                                  10-03-2010
Denmark                                                                07-07-2009
Dominica                                                               26-02-2010
Spain                                                                  02-12-2009
Finland                                                                15-09-2009
France                                                                 07-07-2009
Gibraltar                                                              16-12-2009
Greece                                                                 16-03-2010
Grenada                                                                18-03-2010
Iceland                                                                15-09-2009
Isle of Man                                                            16-07-2009




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        Agreements signed by Belgium since March 2009 and awaiting ratification
                                              DTA                                     Approved by
                                                                                       Council of
             Jurisdiction              New     Protocol     TIEA        Signed         Ministers
Japan                                                                 26-01-2010
Liechtenstein                                                         10-11-2009
Luxembourg                                                            16-07-2009
Macedonia                                                             06-07-2010
Malaysia                                                              18-12-2009
Malta                                                                 19-01-2010
Monaco                                                                15-07-2009
Montserrat                                                            16-02-2010
Norway                                                               10-09-2009
Netherlands                                                          23-06-2009
Czech Republic                                                       15-03-2010
United Kingdom                                                       24-06-2009
Rwanda                                                                17/05/2010
Saint Kitts and Nevis                                                 18-12-2009
Saint Lucia                                                           07-12-2009
Saint Vincent and the Grenadines                                      07-12-2009
San Marino                                                            14-07-2009
Seychelles                                                            14-07-2009
Singapore                                                             16-07-2009
Tajikistan                                                           10-02-2009




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                                                                                     ANNEXES – 73




                    Annex 4: List of all Laws, Regulations
                      and Other Documents Received


            Belgium Constitution
            International private law code
            Criminal code

       Commercial legislation
            Company Code

       Tax legislation
            1992 Income Tax Code (updated up to Moniteur belge of 5 March 2010)

       Anti money laundering legislation
          Law of 11 January 1993 on preventing the use of the financial system for
       purposes of money laundering and the financing of terrorism.

       Financial legislation
            Law of 9 July 1975 on the supervision of insurance companies
           Law of 22 March 1993 on the legal status and supervision of credit
       institutions
           Law of 27 March 1995 concerning intermediation in insurance and rein-
       surance and the distribution of insurance
          Law of 6 April 1995 on the legal status and supervision of investment
       companies
           Law of 15 July 1998 concerning the certification of securities issued by
       business companies




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         Law of 2 August 2002 on the supervision of the financial sector and on
     financial services
         Law of 20 July 2004 on certain forms of collective management of
     investment portfolios
         Law of 14 December 2005 abolishing bearer securities
         Law of 22 March 2006 on intermediation in banking and investment
     services and on the distribution of financial instruments
         Law of 27 October 2006 on the supervision of institutions for occupa-
     tional retirement provision
         Programme Law of 27 December 2006
         Law of 2 May 2007 on disclosure of major holdings in issuers whose
     shares are admitted to trading on a regulated market and laying down miscel-
     laneous provisions
         Law of 16 February 2009 concerning reinsurance
         Law of 31 July 2009 transposing Directive 2007/44/EC as regards proce-
     dural rules and evaluation criteria for the prudential assessment of acquisi-
     tions and increase of holdings in the financial sector
         Royal Decree of 4 March 1991 on certain undertakings for collective
     investment
         Royal Decree of 23 September 1992 concerning the annual accounts of
     credit institutions
         Royal Decree of 10 April 1995 concerning real estate SICAFs
         Royal Decree of 5 March 2006 on market abuse
         Royal Decree of 14 February 2008 on disclosure of major shareholdings

     Other legislation
          Proposal for a Council Directive on administrative cooperation in the
     field of taxation
         Law of 25 Ventôse, Year XI, containing organisation of the notarial
     profession.
         Law of 2 May 2002 on non-profit-making associations, international non-
     profit-making associations and foundations




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           Royal Decree of 26 June 2003 on the simplified accounting of some non-
       profit-making associations, international non-profit-making associations and
       foundations
           Law of 16 January 2003 establishing a Banque-Carrefour des Entreprises,
       modernising the register of commerce, creating approved business registra-
       tion centres and laying down miscellaneous provisions
          Organic Royal Decree of 3 December 2009 concerning the operational
       departments of SPF Finances
           Organic Royal Decree of 3 December 2009 concerning departments
       other than operational departments in SPF Finances
            Reply to the parliamentary question of Senator De Clippele, 10 July 1991




PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – BELGIUM © OECD 2011
          ORGANISATION FOR ECONOMIC CO-OPERATION
                     AND DEVELOPMENT
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                          (23 2011 18 1 P) ISBN 978-92-64-10830-1 – No. 58103 2011
Global Forum on Transparency and Exchange of Information
for Tax Purposes

PEER REVIEWS, PHASE 1: BELGIUM
The Global Forum on Transparency and Exchange of Information for Tax Purposes is the
multilateral framework within which work in the area of tax transparency and exchange
of information is carried out by over 100 jurisdictions which participate in the work of the
Global Forum on an equal footing.
The Global Forum is charged with in-depth monitoring and peer review of the
implementation of the standards of transparency and exchange of information for tax
purposes. These standards are primarily reflected in the 2002 OECD Model Agreement
on Exchange of Information on Tax Matters and its commentary, and in Article 26 of the
OECD Model Tax Convention on Income and on Capital and its commentary as updated in
2004, which has been incorporated in the UN Model Tax Convention.
The standards provide for international exchange on request of foreseeably relevant
information for the administration or enforcement of the domestic tax laws of a requesting
party. “Fishing expeditions” are not authorised, but all foreseeably relevant information
must be provided, including bank information and information held by fiduciaries,
regardless of the existence of a domestic tax interest or the application of a dual
criminality standard.
All members of the Global Forum, as well as jurisdictions identified by the Global Forum
as relevant to its work, are being reviewed. This process is undertaken in two phases.
Phase 1 reviews assess the quality of a jurisdiction’s legal and regulatory framework for
the exchange of information, while Phase 2 reviews look at the practical implementation of
that framework. Some Global Forum members are undergoing combined – Phase 1 plus
Phase 2 – reviews. The ultimate goal is to help jurisdictions to effectively implement the
international standards of transparency and exchange of information for tax purposes.
All review reports are published once approved by the Global Forum and they thus
represent agreed Global Forum reports.
For more information on the work of the Global Forum on Transparency and Exchange of
Information for Tax Purposes, and for copies of the published review reports, please visit
www.oecd.org/tax/transparency.


  Please cite this publication as:
  OECD (2011), Global Forum on Transparency and Exchange of Information for Tax Purposes
  Peer Reviews: Belgium 2011: Phase 1: Legal and Regulatory Framework, Global Forum on
  Transparency and Exchange of Information for Tax Purposes: Peer Reviews, OECD Publishing.
  http://dx.doi.org/10.1787/9789264108738-en
  This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and statistical
  databases. Visit www.oecd-ilibrary.org, and do not hesitate to contact us for more information.




                                                    ISBN 978-92-64-10830-1

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