By Anna McLauchlin & Hughes Beaudouin - 18th May 2004
A hard won EU law taxing expat savings may not come into force on January 1 as planned after Switzerland admitted Bern's legal procedure could hinder its side of the bargain.
Bern signed nine bilateral agreements with Brussels on Wednesday, including its commitment to crack down on untaxed foreign savings, without which the EU law cannot come into force.
But Swiss president Joseph Deiss told journalists the law could take more than six months to implement.
"It will involve a number of stages", the president said, "including two chambers of parliament and the possibility of a referendum".
"It will not be possible to guarantee we will be ready", he admitted.
If there is a referendum this could delay proceedings by a further three months, Deiss said.
A commission spokesman admitted a delay in approving the Swiss law could obstruct implementation of the law, which steps up EU co-operation to shop expat tax evaders, within Europe.
Under the original agreement, the EU law on savings can only be implemented if similar laws are signed with five third countries by the end of June: Switzerland, Lichtenstein, Monaco, San Marino and Andorra.
The spokesman was more upbeat about the other countries which have yet to sign agreements.
"The fact that the Swiss have now agreed (the law) will put pressure on the other four", the spokesman said.
EU finance ministers will consider their next move at a meeting on June 2, he said.
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