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As a reaction to the Pandora Papers, on October 21, 2021 the European Parliament adopted a resolution calling for measures and deploring the fact that a number of politicians, including EU high-level decision-makers, have also featured in the Pandora Papers. The resolution was adopted by 578 votes in favour, 28 against and 79 abstentions. The resolution follows on the indignation expressed by MEPs at an October plenary debate held two days after the publication of the first findings of the Pandora Papers.

 

The European Parliament a.o. calls on the Commission to review the data exposed in the Pandora Papers and analyse whether further legislative action is appropriate at EU level, and also whether any enforcement proceedings are necessary as regards current legislation, and to report back to Parliament.

 

It furthermore deplores the fact that a number of politicians, including EU high-level decision-makers, have also featured in the Pandora Papers, and calls on the authorities of the Member States involved to carry out appropriate investigations into any wrongdoing; deplores, in particular, the fact that politicians such as Andrej Babiš, the Prime Minister of Czechia, and Nicos Anastasiades, the President of Cyprus, who both sit on the European Council, in addition to Wopke Hoekstra, the Dutch Minister of Finance, and also Ilham Aliyev, the President of Azerbaijan, former British Prime Minister Tony Blair, Milo Đukanović, the President of Montenegro, and former Maltese Minister and former EU Commissioner John Dalli, have all been mentioned in the Pandora Papers with reported links with offshore dealings.

 

Parliament also urges Member States and world leaders gathered in the G20 intergovernmental forum, the Inclusive Framework and in the United Nations to take effective measures to rein in tax havens and their operating model, by effectively banning shell companies (corporations with no economic substance whose sole purpose is to avoid taxes or other laws) through the introduction of specific mandatory transparency and business activity criteria to prevent their use and outlawing other forms of financial secrecy, and to agree on and promptly implement a minimum effective corporate tax rate, while further extending and improving the global automatic and mandatory exchange of information on all sorts of private holdings.

 

It also deplores the fact that many jurisdictions, including in the EU, have for many years fallen short of complying with basic FATF requirements to impose AML/CFT obligations on the intermediary non-financial sector to tackle its creation of secretive structures.

 

Parliament insists that in order to carry out the future legislative reforms of tax policy necessary to effectively address the issues highlighted in the Pandora Papers, the Commission should explore all possibilities offered by the Treaty on the Functioning of the European Union, including Article 116, to make decision-making more efficient.

 

In the resolution the EP also states that it regrets the fact that the EU list, which is also referred to as the EU Tax Havens Blacklist, has remained a blunt instrument despite ever more tax scandals and worrying reports by journalists and non-governmental organisations; regrets the fact that Member States’ finance ministers have not yet assumed their individual and joint responsibilities in the fight against tax havens, offshore companies and trusts, and have instead been engaged in watering down the existing blacklist.

 

Parliament particularly deplores the fact that following the Pandora Papers revelations, the Council of EU Finance Ministers decided to shorten the EU list of tax havens at its meeting on5 October 2021, removing the Caribbean islands of Anguilla and Dominica, as well as the Seychelles, which featured in the revelations and still only partially complies with the international standard on transparency and exchange of information upon request, despite a second evaluation round recently granted by the Global Forum;

 

It is furthermore reiterated the conclusions and recommendations of its resolution of 21 January 2021 on reforming the EU list of tax havens; calls for more transparency on the criteria used for the listing process; believes that this reform should be carried out by the end of 2021 in order to protect the EU from any further revenue losses in the post-COVID-19 recovery period

 

Above we highlighted some of the paragraphs of the resolution as adopted by the European Parliament on October 21, 2021. The full text of the resolution you can find here.

 

 

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