Rs 0.672.933.612 Agreement Of 19 August 2009 Between The Swiss Confederation And The United States Of America Regarding The Request For Information From The Internal Revenue Service United States Relative To The Swiss Company Ubs Ag (With Annex And)

Original Language Title: RS 0.672.933.612 Accord du 19 août 2009 entre la Confédération suisse et les Etats-Unis d’Amérique concernant la demande de renseignements de l’Internal Revenue Service des Etats-Unis d’Amérique relative à la société de droit suisse UBS SA (avec annexe et

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0.672.933.612 translation agreement between the Swiss Confederation and the United States of America regarding the request for information from the Internal Revenue Service United States relative to the Swiss company UBS SA determined on August 19, 2009, approved by the Federal Assembly on 17 June 2010, entered into force August 19, 2009 (status on June 17, 2010) the Swiss Confederation and the United States of America hereinafter referred to as "Parties", eager to reaffirm and strengthen the traditional bonds of friendship between their peoples and to continue and enrich the cooperative relationship between the two countries, respectful of their sovereignty and their respective democratic traditions, the rule of law, to resolve their differences amicably in accordance with their respective laws, based on art. 26 of the Convention of October 2, 1996, between the Swiss Confederation and the United States of America in order to avoid double taxation taxation on income (hereinafter "the Convention"), on the MOU that has been an integral part of the Convention (hereinafter ' the Protocol'), and on the mutual agreement of 23 January 2003 on the application of art. 26 of the Convention, which are jointly developed mechanism to exchange the information necessary for the prevention of "fraud and similar offences", given that on July 21, 2008, the Internal Revenue Service (IRS), acting under the competencies conferred on him by art. 26 U.S.C. §7602 (a), filed a complaint ("John Doe Summons"; JDS) against UBS SA, to obtain information on the accounts of some of its customers, seen on the date of signature of this agreement or a date close, the IRS and UBS AG have reached an agreement, separate, and eager to avoid any new dispute relating to a request for information, have agreed on the following provisions with reference to art. 26 of the Convention: article 1 request for mutual administrative assistance 1. The Swiss Confederation treats the request for administrative assistance of the United States on American clients of UBS AG (hereinafter "administrative assistance request") based on the criteria in the annex to this agreement. Based on the criteria, the Parties consider that the request for administrative assistance covers about 4450 accounts opened or closed.
2. the Swiss Government set up a special operational unit allowing the Federal Government contributions (AFC), as part of the request for administrative assistance, to make its final decisions within the meaning of art. 20J of the Ordinance of June 15, 1998 on the double taxation Convention americano-suisse of 2 October 1996 according to an accelerated procedure. Deadlines are the following:-the first 500 decisions must be made within 90 days of receipt of the request for administrative assistance; and - the remaining decisions are processed continuously within 360 days of receipt of the application.

3. upon receipt of the request for administrative assistance, the AFC shall inform UBS AG. It supports priority the procedure in this article based on the criteria set out in the annex. She is committed to dealing with all issues that might arise in this respect according to the mechanism defined in art. 5 of this agreement.
4. in order to expedite the processing of the request for administrative assistance by the AFC, the IRS will ask all clients of UBS AG joining the voluntary disclosure program from the date of signature of this Agreement declare that they allow UBS AG to provide information on their accounts.
5. the Swiss Confederation is ready to process applications for administrative assistance complementary to the IRS case UBS SA, under art. 26 of the Convention, if, in a future judgment, the federal administrative court extends the criteria set out in the annex.

UBS will inform the holders of the accounts affected by the request for information. (i) these accounts will be a final decision of the CFA in accordance with the procedure laid down in the Convention, or (ii) the Bank documents will be sent directly to the IRS if the holders of these accounts have stated that they authorized UBS or the AFC, or (iii) these accounts will be subject to the procedure laid down in the Convention if their owners have empowered the AFC to request copies of statements FBAR to the IRS for the years in question as described in the schedule to the by. 2.A.b and 2.B.b new content according to art. 1 No 3 of the prot. March 31, 2010, applied on a provisional basis as of March 31, 2010 and in force since 17 June 2010 (RO 2010 1459 2909).
SR 672.933.61 art. 2 revision of the Convention the Parties undertake to sign promptly, but no later than September 30, 2009, the new Protocol initialled on 18 June 2009 amending, among other provisions, art. 26 of the Convention. They shall ratify the new Protocol as quickly as they allow their respective constitutional procedures.

Art. 3 withdrawal of the John Doe Summons 1. Immediately after the signing of the present agreement, the United States and UBS AG will present a joint motion to classify the request for enforcement of the JDS at the U.S. Court for the district of the South Florida.
2. subject to art. 5, the United States will not ask the JDS execution as long as this agreement is in force.
3. subject to the provisions of art. 4 by UBS AG, the United States will withdraw the JDS unconditionally no later than December 31, 2009, for accounts that are not affected by the request for administrative assistance.
4. the United States will withdraw the JDS unconditionally on January 1, 2010 or at a later date for the accounts affected by the request for administrative assistance when they have received all the relevant information, regardless of the source, provided on February 18, 2009 or at a later date, about 10,000 accounts reported, open, or closed, of UBS AG. The United States will regularly inform the AFC on the number of cases in which the information was provided.
5. subject to the provisions of art. 4 by UBS AG and subject to art. 5, the United States will withdraw the JDS unconditionally to 370 days after the signing of this agreement for the accounts involved in the request for administrative assistance.

In this paragraph, the expression "regardless of the source" covers them information provided (i) in the application of information, (ii) in the context of the voluntary disclosure program of the IRS, (iii) as a result of the permissions provided to UBS or the AFC as the transmission of information to the IRS, or (iv) in part of the Deferred Prosecution Agreement entered into between UBS AG and the Feb 18 United States. 2009. in addition, the IRS will include, to the extent possible, information on relevant accounts obtained through statements FBAR fulfilled after the signing of this agreement and for which she was able to determine that they were attributable to the fact that the Parties have reached this agreement.

Art. 4 obligations of UBS 1. In the agreement separated agreement with the IRS, UBS AG is committed to comply with the request of the AFC on the transmission of information in the request for administrative assistance, within the following time limits: - within 60 days after that UBS AG will be informed by the AFC that it has received the application, it shall submit the first 500 cases; - within 180 days after that UBS AG will be informed by the AFC that it received such request, it shall submit the remaining cases referred respectively to the by. 2.A.b and 2.B.b of the annex; and - within 270 days after that UBS AG will be informed by the AFC that it has received the application, it will submit him all the remaining cases.

2. in the agreement separated agreement with the IRS, UBS AG is committed to continue its support to the voluntary disclosure program.
3. the federal Office of justice (FOJ), with the support of the federal supervisory authority of financial markets (FINMA), ensures the strict observance by UBS AG of its commitments.

Art. 5 verification of the progress of the process, consultations and other measures 1. The AFC, the FOJ and the IRS meet once per quarter with UBS AG in order to check the status of the procedure established under this agreement, by evaluating the effectiveness of the voluntary disclosure program put in place for American UBS clients and deciding other measures that the Parties can reasonably adopt to support the legitimate interests of the IRS in the application of the tax in the United States.
2. the Parties may at any time request further consultations relating to the implementation, interpretation, application and the modification of this agreement. These consultations (made either orally, or in writing) will be held within 30 days of receipt of such a request, unless the Parties decide otherwise.
3. If one of the Parties fails to its obligations under this agreement, the other party may request immediate consultations to adopt appropriate measures to ensure the application.

4. If, 370 days after the signature of this agreement, actual and anticipated results differ considerably from what may reasonably be expected on that date in the light of the purpose of the latter and if the Parties cannot remedy agreed (1) by adopting measures of consultation in the sense of by. 2 and 3 of this article or (2) by amending the agreement according to the procedure laid down in art. 9, each of them may take proportionate measures to restore a balance between the rights and obligations created by this agreement. These measures, however, should not go beyond what is necessary to safeguard the legal situation prevailing for each part right up until they are adopted.
5. the measures adopted under this section do not bond financial, or new obligations of extra-financial order to UBS AG.

Art. 6 confidentiality the first public statements will take place simultaneously on 19 August 2009 at 15:30. In order to avoid hampering the tax administration both in the United States and Switzerland, the Parties agree not to reveal the terms of the annex to this agreement and not publish this last 90 days after the date of signature. However, nothing precludes the AFC to explain to the holders of the accounts involved the specific criteria on which its final decisions will be based. Said holders of accounts will incur a penalty under Swiss criminal law if they reveal these criteria to third parties before the date of publication of the annex.

Annex will be brought to the attention of UBS AG, which must comply with the same requirements as to confidentiality.

Art. 7 third party rights this agreement confer any right or benefit to third parties other than those who are vested in UBS AG.

Art. 7aConflit of standards in case of conflict of standards and for the purpose of processing the request for administrative assistance, the agreement and its annex shall prevail the Convention, its Protocol and the mutual agreement of 23 January 2003.

Introduced by art. 1 ch. 4 of the prot. March 31, 2010, applied on a provisional basis as of March 31, 2010 and in force since 17 June 2010 (RO 2010 1459 2909).

Art. 8 entry into force this agreement comes into force upon signature.

Art. 9Modifications this agreement may be amended by written agreement between the Parties. If Swiss law provides an additional approval procedure, the Parties may decide to apply the text amended on a provisional basis until its approval.

New content according to art. 1 ch. 5 of the prot. March 31, 2010, applied on a provisional basis as of March 31, 2010 and in force since 17 June 2010 (RO 2010 1459 2909). According to art. 3 c. 1 of the said Protocol, the amendment of the agreement does not affect not the validity of the request for administrative assistance, final decisions already issued and all the measures of law and of fact taken by UBS and the AFC under the agreement.

Art. 10 validity and denunciation this agreement remains in force until the Parties have confirmed in writing that they have met the obligations arising therefrom.
In faith of what, the undersigned, duly authorized to that effect by their respective Governments, have signed this agreement.
Done in duplicate at Washington DC on 19 August 2009 language English.

Annex criteria to provide mutual administrative assistance as part of the request for information from the IRS-1. A request for administrative assistance in principle involves identifying clear and accurate of the persons concerned. However, given (i) the misconduct highlighted in some U.S. taxpayers, holders of accounts not reported on Form W-9 (non-W-9) from UBS SA Switzerland (UBS) in their own name or on behalf of an offshore company without operational activities which they were beneficial owners, and (ii) the specificity of the Group of people concerned, described in section 4 of the statement of facts of the Deferred Prosecution Agreement (DPA) signed between the United States and UBS on February 18, 2009 It is not necessary to mention the names of American clients of UBS in the request for administrative assistance. Thus, in accordance with section 4 of the statement of facts of the DPA, the general condition regarding the identification of individuals covered by administrative assistance is considered as completed for the following people: a. the UBS clients domiciled in the United States who, for a period between 2001 and 2008, were direct holders and beneficial owners of securities accounts undeclared (no-W-9) and deposit accounts of UBS with a value of more than a million francs and whose There are serious reasons to believe they have committed "fraud or similar crimes", forgotten the source. citizens (regardless of their home) economic beneficiaries of accounts of offshore companies based or operating between 2001 and 2008 that there are serious reasons to think they committed "fraud or similar offences.

2. the criteria agreed to establish 'fraud and similar offences' in this application of sfta in reference to the Convention are the following: a. on securities accounts undeclared (no-W-9) and the accounts of deposit within the meaning of point 1(a) of this annex, the existence of States of fact for which there is serious reason to think taxpayers domiciled in the United States were engaged in the following activities : a. alleged activities address fraudulent conduct, including activities resulting in concealment of assets or failure of certain income through a false construction or the communication of false or inaccurate documents; When such facts have been established, the people who held accounts whose assets were less than a million francs (with the exception of less than 250 000 francs assets) during the reporting period are also integrated into the Group of Americans subject to the request for administrative assistance; forgotten the source. actions representative of lasting and serious crime for which the Swiss Confederation can information in accordance with its legislation and administrative practice. According to the interpretation of parts, these actions include also cases where (i) the taxpayer resident in the United States did not provide a W-9 form for at least three years (including one year at least covered by the request for administrative assistance) and (ii) the account at UBS has generated revenues of more than CHF 100,000 on average per year for any period of three years, including one year at least covered by the request for administrative assistance. The analysis takes into account the gross income (interest and dividends) and capital gains (equivalent, as part of the request for administrative assistance, to 50% of the gross proceeds of sales on account during the reporting period).

B. concerning the accounts of offshore companies in the sense of section 1.B of this annex, the existence of States of fact for which there are serious reasons to believe that the beneficial owners US engaged in the following activities: a. alleged activities address fraudulent conduct, including activities resulting in concealment of assets or failure of certain income through a false construction or the provision of false or inaccurate documents , with the exception of the entitled economic American accounts of offshore companies having detained less than 250 000 francs assets during the period under review; forgotten the source. actions representative of lasting and serious crime for which the Swiss Confederation can information in accordance with its legislation and administrative practice. According to the interpretation of the Parties, these actions also include cases where the American National has not proved, following notification of the AFC, that it has complied with its obligations to report related to the interest it owns in accounts of offshore companies (allowing the AFC to ask the IRS for copies of FBAR returns for the reporting period). Without such proof, the AFC provides information insofar as (i) the account of the offshore company has existed for an extended period (i.e. at least three years of which one year covered by the request for administrative assistance) and (ii) the revenue generated amounted to more than 100,000 francs on average per year for any period of three years, including one year at least covered by the request for administrative assistance. The analysis takes into account the gross income (interest and dividends) and capital gains (equivalent, as part of the request for administrative assistance, to 50% of the gross proceeds of sales on account during the reporting period).

The Swiss Confederation and the United States of America are, the signing of the agreement concerning the request for information from the IRS about UBS SA, August 19, 2009 in Washington, DC, the following statements, which are an integral part of the agreement: statement of the Swiss Confederation


The Swiss Government says it will be held at the disposal of the IRS to review and process additional requests for administrative assistance under art. 26 of the double taxation agreement if these applications are based on a set of circumstances and facts equivalent to those of the UBS AG case.

Statement of the United States of America in the United States declare that they will take into account all the circumstances and take into account the observation by UBS AG of the provisions of the agreement, as well as willingness to cooperate, to determine if rebalancing measures within the meaning of art. 5, by. 4, are proportionate.
Done in two copies at Washington on August 19, 2009 language English.

Update according to art. 1 c. 6 to 8 of the prot. March 31, 2010, applied on a provisional basis as of March 31, 2010 and in force since 17 June 2010 (RO 2010 1459 2909).
Such "false constructions" can exist when, according to the information provided by the Bank documents, the economic beneficiaries have used (i) false documents; (ii) a procedure described in the case studies in the schedule to the mutual agreement on the application of art. 26 of the Convention (e.g. by resorting to legal or physical persons acting as intermediaries or beneficiaries to repatriate funds or transfer in another way on account of the offshore company); or (iii) calling cards to disguise the origin of the trade. These examples are not exhaustive and, depending on the facts and the circumstances of the case, other activities may be considered by the AFC as a false construction.
For deposit accounts, there are, according to the interpretation of the Parties, serious reasons to think that it is such criminal behavior if the American national in question does not prove, following notification of the AFC, that it has complied with its obligations to report under the tax law related to the interests it has in such accounts (allowing the AFC to ask the IRS for copies of FBAR returns for the reporting period).
Such "false constructions" can exist when indications provided by bank documents, the economic beneficiaries have directed and controlled in a sustainable way, fully or partially, the management and investment of the assets of the account of the offshore company or have, in another way, not respected the forms or the content of what was supposed to be the property of the company (which means that the offshore company was working as an intermediary (, company or representative of the American economic right screen): (i) taking investment decisions contrary to indicate documentation related to accounts or tax forms submitted to the IRS and to the Bank; (ii) using phone cards or special phones to conceal the origin of trade; (iii) using cards debit or credit in order to repatriate funds fraudulently or transfer in any other way to meet personal expenses or payments of routine personal bills of credit cards from assets of the account of the offshore company; (iv) by electronic transfers or other payments from the account of the offshore company to accounts owned or controlled by the American beneficial or one of his relatives in the United States or in another country, in order to conceal the true origin of the person making these payments; (v) by resorting to legal or physical persons acting as intermediaries or beneficiaries to repatriate funds or transfer in another way on account of the offshore company; or (vi) providing loans to the beneficial owner American or one of his relatives from assets directly from the account of the offshore company, guaranteed by this account or paid from this account. These examples are not exhaustive and, depending on the facts and the circumstances of the case, other activities may be considered by the AFC as a false construction.

State on June 17, 2010

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