30

Apr

“Intelligente Stromzähler nur mit intelligentem Datenschutz”

“Intelligent electricity counters,” so-called smart meters, but “only with intelligent data protection.” German data protection officer Peter Schaar (his official title is Federal Commissioner for Data Protection and Freedom of Information) praised some recent developments on the data protection front but criticized weaknesses remaining in protecting e.g. employee data and the data that can be gleaned from smart meters. Schaar has been warning against excessive technology-driven transparency of electricity consumers since at least 2011. His office produced a pro-consumer guideline in 2012 to supplement the 2011 Energiewirtschaftsgesetz (Energy Industry Act) amendments that enabled the smart meters which the smart grid will need for flexible management of renewable energy sources and which so-called “smart customers” are to be able to use to manage their own utility consumption. The guideline points are to flow into law eventually.

(In TELL ee GENT ah   SHTROAM tsay lah  noor   mitt   in TELL ee GENT em   DOT en SHOOTZ.)

11 years ago Short URL Comments

/////////

29

Apr

Cum-Ex-Geschäfte

“Cum/ex transactions.” A lucrative tax loophole that major German banks have been using. Spiegel reported the story on 28 Apr 2013, saying it had been broken by the Berlin Sunday version of Die Welt (Die Welt am Sonntag, WamS) but so far search results for it online are only turning up in Der Spiegel. The loophole, estimated to have cost the German government 12 billion euros so far, was created by corporate tax reform legislation of the SPD + Green Party coalition in 2002. Though discovered by officials shortly thereafter in 2002, and reported all the way up the chain of command, the loophole was not fixed by Hans Eichel (SPD) or his successor Peer Steinbrück (SPD, currently running against Angela Merkel for chancellor of Germany). Amendments to the law in 2007 made the situation worse, Spiegel reports that WamS reports. Wolfgang Schäuble (CDU) appears to have waited several years to fix the problem as well, though now the order appears to have gone out.

The problem was this: under certain circumstances capital gains tax could be reimbursed multiple times. After e.g. stocks or bonds were sold short but before they were bought back to conclude the transaction, German bureaucracy sometimes obscured to whom the stocks or bonds belonged: the person loaning the stock, the short seller or the end customer. The question would be trivial, say financial reporters, were it not for the fact that sometimes if the sale occurred right before a dividend the German IRS would erroneously issue more than one get-your-tax-back certificate for capital gains on the stock. Honest people would ignore the unearned get-your-tax-back certificate, but others would deliberately game the system to get the treasury to reimburse them these taxes even conceivably more than five times, said professor Heribert Anzinger of the University of Ulm.

This looks like the dividend stripping loophole HypoVereinsBank and others were reported in 2012 to have used to extract money from the German fiscus. Etymologically, Wikipedia contributors explain, when a company’s general assembly of shareholders decides to issue a dividend, the dividend is usually issued the day after the assembly meeting, called the “ex day” (“Ex-Dividende”). The day before the ex day is called the cum day, for arcane reasons.

(COOM   ECKS   geh SHEFF teh.)

11 years ago Short URL Comments

///////////////

28

Apr

Das neue Bankenpaket

The new package of bank regulations passed by the EU on 16 Apr 2013. It applies to all banks and is intended to strengthen their situation so they can’t bring down any more world economies. 1) Banks must set aside a higher percentage of reserve capital, a bigger “capital buffer,” to save them in times of crisis; 2) starting 2015 their total debt will be limited; 3) an upper limit was set for banker bonuses (max. 2x the annual salary).

(Doss   NOY ah   BONK en pock ate.)

 

11 years ago Short URL 2 Comments

////

27

Apr

Baumängel

“Construction deficiencies.” The factory building that recently collapsed in Bangladesh, in which thousands of people were working despite cracks in the walls having been spotted the day before, had insufficient steel in its framework, insufficient cement in its concrete, and whoever was responsible had added three extra stories to the number of floors allowed on its construction permit.

There were reports that, after the cracks were spotted, fire inspectors closed the building. But factory owners ignored them and ordered people in to work the next day.

(B OW! main gell.)

11 years ago Short URL Comments

/////

26

Apr

UAW-Datenbank

 

“Adverse events database” (unerwünschte Arzneimittelnebenwirkungen-Datenbank). BfArM (Bundesinstitut für Arzneimittel und Medizinprodukte, the regulatory German Federal Institute for Drugs and Medical Devices) has created an online portal providing free access to its database of all suspected side effects reported to BfArM for all drugs since 1995. The UAW-DB is for doctors, patients, scientists and the merely curious.

The suspected side effects were submitted by hospitals, physicans and patients themselves, but not from clinical trials. Unlike the confirmed ones listed in package inserts and expert information sheets, the side effects listed here may or may not have been proven to have been caused by the medications used.

(OO AH VEY dot en bonk.)

11 years ago Short URL Comments

//////

25

Apr

Datendrosselung

“Data throttling.” Deutsche Telekom, whose subsidiary T-Mobile stood out from other US telephone companies because it was never explicitly mentioned in the press as having given its customers’ data to the George W. Bush administration, has announced that starting May 1, 2013, it will slow down internet traffic for its flat-rate German customers above a low monthly data limit of 75 GB. There will be no appeal. People are furious. Critics say there may be a competition issue because Telekom’s own online content, such as from its entertainment channels, will not count toward the monthly data limit. If so, this might be a case for the Bundesnetzagentur, the German Federal Networks Agency for Electricity, Gas, Telecommunications, Post and Railroads (BNetzA).

Update on 30 Oct 2013: A Cologne court forbade Deutsche Telekom to slow down the data supplied to its flat-rate internet customers, in a lawsuit brought by the North Rhine-Westphalian Consumer Protection Agency [Verbraucherschutzzentrale Nordrhein-Westfalen e.V.]. Deutsche Telekom was planning to reduce these household internet connections to as low as <10% of normal surfing speeds.

Süddeutsche.de reported that the court said Telekom could slow down its customers’ internet access but not without changing its current marketing. Without fixing the problem, “Drosselkom” had tried several responses to the outrage sparked by these plans this year, including offering a second more expensive flat rate plan that really, they swore, this time, would not be subsequently decelerated. Competitors 1&1 and Kabel Deutschland have been capping their customers’ internet connections too, SZ reported. They quoted a pundit as saying the Cologne Landgericht’s verdict was important for starting to create limits to contracts that have been being arbitrarily changed by companies. Telekom plans to appeal.

(DOT en DROSS ell oong.)

11 years ago Short URL 2 Comments

//////////

24

Apr

Geschäftsführung und Aufsicht in einer Hand

“Management and management oversight in one hand.” Combining monitoring and management roles into one job held by one manager supposed to check themselves.

There can be overlap in groups as well. Apparently the board of directors running a German company and the supervisory board (Aufsichtsrat) that monitors the board of directors may not contain the same people, but this exclusion does not apply in the USA where, writes the F.A.Z., e.g. when the supervisory board approves the compensation of the management board, people who happen to be in both groups will at best merely abstain from voting.

(Geh SHEFTS foor oong   oond   OW! f sichht   in   eye ner   Hond.)

11 years ago Short URL 4 Comments

///////////

23

Apr

Niederländische Zwischenhändler

“Dutch intermediary dealers.” EU findings from a total of ~7000 genetic tests on food products to investigate mislabeled horsemeat were announced on 16 Apr 2013. 0% abnormal test results in the UK, 3.3% in Germany and 13.3% in France, where purchases from Dutch intermediaries turned out to be particularly mislabeled. A French Green Party member claimed it wasn’t even proper horse meat being mislabeled, but rather slaughterhouse wastes. On se demande encore comment est-il possible qu’il y ait tant de chevaux en Europe? Where are so many horses coming from, that horse meat could prove cheaper than farmed beef and mutton on the global market? Racetracks?

Particularly customers of the shadowy Dutch figure known as Willy Selten are affected. Yet again, Dutch is funny if you know English and German but not Dutch. Willy Selten’s large meat wholesaler delivered to ~500 companies in 16 EU countries.

The EU commissioner for consumers wants to change government food testing to verify truth in labeling from a national to a European matter. He said this is another problem whose scope exceeds the capacity of individual national government offices. Crowdsourced cheap DNA test kits for species-specific markers would also help.

(NEE derr lend ish eh   TSVISH en hend lah.)

11 years ago Short URL Comments

//////

22

Apr

Fantastillionen

“Lots of money,” an “unimaginable fortune,” but no one knows how much yet. The Münchener Abendzeitung reported reports, firmly denied, of account balances totalling several hundred million euros. Uli Hoeneß, the president of German soccer’s version of the NY Yankees, FC Bayern Munich, submitted a Selbstanzeige in January 2013 for unpaid taxes on funds in one or more Swiss bank accounts and has already paid an initial lump sum of about six million in unpaid taxes. He said he didn’t report himself before January 2013 because he was betting the tax agreement with Switzerland would be ratified that provided amnesty, anonymity and a low tax rate for “tax sinners.” Tagesschau.de reports that it’s still unclear where the untaxed monies came from, whether from his bratwurst factory or from other sources.

ZDF heute journal found footage of Hoeneß on talk shows such as the charming Günther Jauch’s in autumn 2012 recommending low taxes for rich Germans because otherwise, he said, they would move to Austria, Switzerland or “who knows where.”

CSU chair Horst Seehofer confirmed on Saturday, 20 Apr 2013, at a CSU meeting in a Munich Hofbräuhaus cellar, that the district attorney was looking into the matter. The CSU had been going to propose Hoeneß as a political candidate, and he probably would have been confirmed.

The Münchener Abendzeitung commented on 20 Apr 2013:

“The question remains whether Hoeneß can now hope for the same support from the Bavarian state government as Franz Beckenbauer, to whom Bavarian finance minister Ludwig Huber once gave tips about tax flight into Switzerland while Huber was still in office?”

Achtung: Focus Magazin’s publisher is on the board of FC Bayern Munich.

(FAHN tossed ill ee own en.)

11 years ago Short URL 2 Comments

////////////////////

21

Apr

Windhund-Verfahren

“Greyhound method” for first-come-first-serve allocation of press seats in the small state courtroom where the last surviving member of the neonazi serial-killing terrorist cell will go on trial this month. The foreign press didn’t find out about signing up until half an hour after local journalists had gotten the last seat. There has been serious shouting, ernsthafte Diskussion and a rapid decision by the constitutional court in Karlsruhe, and now the trial has been delayed a couple weeks and seats will be redistributed.

(VIND hoond fer FAR en.)

11 years ago Short URL Comments

//////

20

Apr

von Bodelschwinghsche Stiftungen Bethel in Bielefeld-Gadderbaum

The Bethel foundation for the mentally ill in Bielefeld-Gadderbaum, a Protestant institution founded in 1867 by a Pastor Bodelschwingh that is one of the most impressive institutions of its kind in the world, and one of the kindest. Treating about 185,000 patients each year, both inpatient and outpatient, with assisted living group apartments in varying degrees of autonomy; many of the ~16,000 caregivers live in the community (in very nice apartments).

(Fon   BOH dell SHVING sheh   SHTIFF toong en   BEY tell   in   BEE leh feld   GODDA bow! m.)

11 years ago Short URL Comments

///

19

Apr

Selbstanzeige

“Self reporting,” voluntary submission of an amended German tax return reporting money hidden in e.g. Switzerland. You can still report yourself to the German IRS, pay a low tax rate on the unreported funds, get immunity from prosecution and legally repatriate the money to Germany. The reason we know there are still Germans with Schwarzgeld, under-the-table or “black” capital, in Swiss bank accounts who have not taken advantage of the Selbstanzeige is because the German state governments, acting independently, buy CD’s of data about these accounts and use them to pursue tax sinners for fun and profits. The state of Rhineland-Palatinate recently bought another one, for the 500 million euros they expect to collect with its help and because no capital crimes were committed in the seller’s acquisition of it. ~200 apparently-related tax razzias took place on 16 Apr 2013. The RP finance minister is asking the other German states to show solidarity by contributing toward the purchase price because they too will be benefiting from the content. Lower Saxony has already announced they will contribute. Both states are ruled by SPD and Green Party coalitions.

The Selbstanzeige will soon be irrelevant because international negotiations are moving toward closing the loopholes, especially since publication of the “offshore leaks” financial data trove. Meanwhile, the Süddeutsche Zeitung writes in a wonderful history of bank account data sales to Germany, RP tax officials are “electrified” and say they’ve never had foreign bank account data this good before. “First class.” It sounds like enough years of transfers and other information are included that, after the tax authorities are done with it, the CD could form the basis of some interesting doctoral theses.

The top Rhineland-Palatinate tax agent now says he sees the recently failed tax agreement with Switzerland as disadvantageous, because it provides a partial amnesty and would destroy tax payment morale were it to be ratified now.

(ZELBST on ts eye geh.)

 

11 years ago Short URL 2 Comments

/////////

18

Apr

Offene, freimütige, furchtlose Beratung

“Frank and fearless advice,” what Phillip Adams thought diplomats and the media should give to leaders contemplating war and other violence.

(OH fennah,   fr eye MOOT iggah,   FOORCHHT loh zah   bare OTT oong.)

11 years ago Short URL Comments

////

17

Apr

Pumpspeicherkraftwerke

“Pump storage power stations.” Pumping water into a mountain lake when electricity is cheap, and allowing it to drain out through power-generating turbines when electricity is more expensive, is rather efficient contemporary energy storage (“80% efficiency” for short-term storage of a few hours). Excess electricity is hard to store in quantity and tends to be sold off to neighboring countries instead, so storage issues might be one reason why Germany has quadrupled electricity exports since-and-despite closing eight nuclear power plants in 2011. A more obvious reason would seem to be the success of the Energiewende, large-scale infrastructure investments Germany is making to switch to renewable power sources such as solar and wind.

Of course villagers, fish and tourists near mountain lakes don’t appreciate constant changes in water levels. But the switch to renewable energy sources has undermined the financial benefits of draining lakes every day at lunchtime. Power prices used to peak around noon, so Germany’s >30 pump storage power stations drain their lakes through turbines during daylight hours, pumping the water back up the mountain at night. That demand-driven price spike is now being offset by the daylight collected by solar panels, which private citizens have been encouraged to install on their roofs. Utility companies are starting to not expand, not build, not renovate and shut down their lake storage power stations, as they wait for new technologies.

Next-generation electricity storage options will have to store power not only for hours but also for months, to buffer seasonal fluctuations. Small storage options that, like photovoltaics, can be installed in quantity in e.g. private houses will aid the decentralization trend. Large storage options under discussion include gas chemistry and big hollow concrete spheres lowered to high-pressure depths on the ocean floor: to store energy they would be filled with air and then allowed to refill with seawater, driving turbines.

(POOMP shpy chh ah CROFT verk ah.)

11 years ago Short URL 1 Comment

/////

16

Apr

Das Crowdsourcing von Umweltanalysen

“Crowdsourcing environmental testing,” including sharing of software platforms used and the data resulting from the tests, for the efficiencies associated with wider availability and to prevent knowledge losses that can occur e.g. when you underfund and then destroy E.P.A. libraries. Many experiments with crowdsourcing chemistry and biology testing are ongoing right now. For example, for the past five years high school kids in Lower Saxony, ~10,000 students so far, have been learning to test food products for GMO’s in high school lab classes, often finding modified products in foods labeled GMO-free. The curriculum includes pro and con discussions that must be pretty interesting.

Silicon Valley companies and other communities are experimenting with creating open source software and hardware kits for crowdsourced environmental testing and pharmaceutical testing, according to an interesting new book by Institute for the Future director Marina Gorbis.

(Doss   CRRROWD sauce ing   fun   OOM veldt on ah LOO zen.)

11 years ago Short URL Comments

///////////////////

15

Apr

Die Oasen der Anderen

“The Oases of Others,” a playful film reference in post-leak financial news reporting averring that countries seem more concerned about lax tax rules abroad than they are about their own tax loopholes (i.e., the USA and the state of Delaware).

Der Spiegel reminds us that quality and variety are better bets for future growth than competing internationally in a race to the bottom. There will always be countries with lower wages, so you are better off investing in education for your people and diversifying your industries.

(Dee   oh OZ en   dare   OND er en.)

11 years ago Short URL Comments

////////

14

Apr

Der grosse Knüppel

The big stick (actually, a Knüppel is a blackjack or sap). This week’s breathtaking breakthroughs in offshore accounting EU reform initiatives are said to have only been made possible by help from the USA, which used its very big stick of threatening to cut off uncooperative countries from the financial Mecca that is Wall Street.

Before the offshore data leak was published on 04 Apr 2013, it was Luxemburg and Austria versus 25 EU Member States regarding offshore anonymity, and now Austria is standing alone, which EU countries describe as being “isolated” and fear more than US Americans might expect.

(Dare   GROSS ah   c’nupp ell.)

11 years ago Short URL Comments

///////////

13

Apr

Mumiensturm

“Storm of mummies.” Joschka Fischer was in the German Green Party the first time it managed to join a ruling federal coalition. He became foreign minister (Secretary of State). Years later it turned out the Foreign Office (State Department) had a cadre of elderly and/or retired diplomats who objected to the new government’s decision to stop publishing obituaries of colleagues who had been former nazis, egregious former nazis in the case they chose to start a ruckus over, in the foreign ministry’s small in-house magazine.

Joschka convened an international “Historians Commission” that spent five years researching the history of ex-nazis in the post-WWII German foreign service. They brought sunlight to a problem that had been made possible by, among other things, the fact that FO was the only cabinet ministry allowed to manage its own document archive and thus control and rewrite its own history; all the other cabinet ministries had had to submit their documents to a central federal government archive. Joschka was particularly irked by the following issue as well: there had been a few brave German diplomats during the 1930’s and 40’s who tried to resist the nazis; most were killed for their troubles; and they tended to be communists. After the war, many of the diplomats with a nazi past or who supported post-nazi colleagues pretended to have been in the resistance. Right wingers hiding behind the communists, Joschka called them. He also called their obituary-based revolution a “mummies storm” like in the Brendan Fraser movies.

(MOOM ee en SHTOORM.)

11 years ago Short URL 1 Comment

////////////

12

Apr

Der Mann ohne Gesicht

“The man without a face,” East German spy chief Generaloberst Markus Wolf. Whose son Franz now runs a complex web (a Geflecht or “weaving,” meshwork) of offshore companies supposedly from his registered residence in Gibraltar. The SZ calls his network an empire, stretching from the Caribbean to Russia. Companies in the network are involved in dozens of industries, including surprisingly water utilities (Wasserversorger, water suppliers). Speaking of water, the chains of companies also once helped hide ownership of the oil tanker Prestige after it sank off the coast of Spain in 2002 and its oil spilled onto Spanish beaches. The SZ said the Neue Zürcher Zeitung wrote that ownership was eventually traced to a Franz Wolf company which quickly disappeared.

(Dare   MONN   oh neh   geh ZICHH t.)

11 years ago Short URL Comments

/////////

11

Apr

Schneeballsystem

“Snowball system,” the house-of-cards finance company operated from 2006 until its collapse in 2011 by a guy now awaiting trial in the USA which ate $117 million of one Venezuelan businessman’s money and the at least $500-million pension fund, for 25,000 workers, of the Venezuelan state oil company PdVSA. Reporting the story on 04 Apr 2013, the ICIJ wrote that the financier appeared to have started the pyramid scheme after suffering a $5 million loss in 2005.

A bankruptcy administrator (Konkursverwalter) or receiver appointed by a US federal court said inter alia that a very well-connected Caracas stockbroker apparently got fees as high as $10 million per transaction for diverting large amounts of money into the pyramid scheme to keep it going, and an investments and insurance manager at the oil company collected $37.5 million for sending PdVSA pension money to Connecticut. The receiver has recovered $230 million from a bank in the Netherlands and is still hunting for the rest, writes the ICIJ. When the SEC started investigating in 2010, they discovered “intricate financial transactions and virtually zero bookkeeping.”

(SHNAY boll zyss dem.)

11 years ago Short URL Comments

////////

10

Apr

Generalsekretariat für Staatseinnahmen

“General Secretariat for Revenues,” a newly created department in the Greek government responsible for checking government income. Its head used to be in charge of the Greek General Secretariat for Information Systems (GSIS). In response to the “Offshore Leaks” data release last week, the Greek Revenues office will be investigating, among other things, a chain of offshore companies that have been providing military technology to Greece and the USA but whose actual ownership remains a mystery.

The Süddeutsche Zeitung reported: “Interoperability Systems International Hellas S.A. […] was co-awarded a 190-million euro order in 2003 for kitting out Greek F-16 fighter jets. The company also delivered hardware and software to the US Marines. In 2003, 33% of ISI belonged to Bounty Investments Ltd., which in turn owned part of another offshore company. Over that company there was a third veil as well. An attorney for ISI Hellas said Bounty Investments ‘fulfilled all requirements of the Greek tax authorities.’ Some experts think companies in the defense sector fundamentally ought not to be messing around in cloudy offshore waters.”

Update on 10 Apr 2013: This highly entertaining* SZ article about a British family that managed letterbox companies (Briefkastenfirmen) in New Zealand and includes Miami, Moscow, Pyongyang, Teheran and Vanuatu notes that it becomes impossible to trace ownership after only three to four “dummy companies” (Scheinfirmen). “After three, four dummy companies in a row the track gets lost in a thicket of commercial registers (Handelsregister, HRB).”

(Genn er OLL seck rett arr ee OTT   foor   SHTOTS eye nom men.)

 * highly entertaining until the deaths of two Russian reformers at the very end of the piece: Sergej Magnitskij (37) and Alexander Perepilitschnij (44).

 

11 years ago Short URL Comments

//////////

09

Apr

Pustekuchen!

Poppycock! In this video op-ed from the Süddeutsche Zeitung, a commentator says it might appear that the best way to reform the world’s tax oases would be to let each fix their own lax tax laws, one-by-one. But piffle! No! Those 40+ tax havens are in competition with one another. Max Planck Institute researchers said market pressures would mean the last holdouts would become too powerfully wealthy and resistant to change. The best way is the one that is most politically difficult: negotiating simultaneous agreements with all tax oases.

(POUSSE teh KOO chh en.)

11 years ago Short URL 1 Comment

///////

09

Apr

Bankgeheimnis

“Banking secrecy.” Luxemburg announced on 07 Apr 2013 that they intend to relax their banking code of silence, “no longer strictly refusing” to automatically share information about international accounts with other countries’ tax authorities, starting in 2015. EU countries have also been in negotiations with Switzerland about similar issues for several years, though individually as separate countries and not with the full power of the EU.

Until now, foreigners banking in Luxemburg have paid an anonymous tax of 35% on interest earned there. This will be changed in Luxemburg e.g so that account holders’ names will be included in the information shared with German tax authorities.

German critics say this is insufficient because other Luxemburg income, such as company profits, remains untaxed for foreigners. Also, Luxemburg isn’t the only European tax oasis. Jürgen Trittin of the Green Party criticized Austria, for example, where names of foreign account holders earning interest in Austrian banks are only shared after initiation of criminal proceedings. Green Party finance guy Gerhard Schick wrote that the G20 summit in 2009 actually agreed to end Bankgeheimnis; certainly some reforms were enacted that year though movement has been slow since, until the recent data leak. The ZDF report concluded by saying that economists have warned that if only some tax oases reform their laws, the ones that don’t will profit from acquiring fleeing customers.

Update on 09 Apr 2013: “In principle, Liechtenstein has separated itself from its tax haven past.” Speaking of Liechtenstein, it looks like they had an interesting idea for a new field for financial services experts in former tax oases to move into: ratings agencies that are independent of the big three on Wall Street. The nonprofit Carlo Foundation (carlofoundation.org), said to be the world’s first independent fund rating agency, was founded in Liechtenstein in July 2012.

Update on 22 May 2013: At their summit in Brussels all 27 EU leaders confirmed in principle their finance ministers’ decision to eliminate Bankgeheimnis for “foreign”-held bank accounts, insurance policies and investments starting in 2015. The leaders of the two last holdouts, Luxemburg and Austria, said they too would agree to the automatic exchange of data after the EU as a whole negotiated banking agreements with relevant third-party countries such as Switzerland, Liechtenstein or Monaco. Luxemburg’s prime minister Jean-Claude Juncker said his country is particularly concerned that the same competition conditions apply in finance centers inside and outside the EU. Negotiations with Liechtenstein, Monaco, Andorra, Switzerland and San Marino about automatic exchange of banking data are underway and expected to be concluded quickly, in “two to three months.” If all goes according to schedule, EU leaders could completely eliminate Bankgeheimnis at their meeting in December 2013.

Update on 20 Mar 2014: The 28 E.U. heads of government agreed to end Bankgeheimnis in the European Union, with comprehensive exchanges of tax data. This will also end banking secrecy for foreigners, though that might mean only for foreigners from other E.U. member states. Five third-party countries, Switzerland, Liechtenstein, San Marino, Monaco and Andorra, also agreed to exchange sufficient information to end banking secrecy de facto with regard to interest income, said Luxemburg’s prime minister, saying this fulfilled Luxemburg’s conditions for also agreeing to the new policy.

The O.E.C.D.’s standard for automatic data exchange will be the orientation point, and the E.U. hopes it will become the standard for tax information exchange regulations worldwide, said E.U. Council President Herman Van Rompuy. But today’s breakthrough E.U. policy agreement goes beyond the requirements of the O.E.C.D. standard:

“In future, the data exchange is supposed to apply not only to private persons but also to certain trusts and foundations. The guideline will also apply for stock profits and certain insurance profits, particularly from life insurance and investment funds. The banks are also to be obligated to collect more information in future about the actual economic owners of companies.”

(BONK geh HIGH mniss.)

11 years ago Short URL Comments

////////////

08

Apr

Partnermedium

Partner member of the media, what the Süddeutsche Zeitung is calling the other news organizations that received copies of the “Offshore Leaks” data trove. The SZ has posted a map showing the countries known so far to contain such media outlets and a list of the latest important discoveries.

(POT nah may dee OOM.)

11 years ago Short URL Comments

/////

07

Apr

Inländische Steueroasen

“Domestic tax oases” inside a country. The head of the largest opposition party to Chancellor Merkel’s government coalition has accused the states of Bavaria and Hesse of acting like tax paradises within Germany by hiring low numbers of tax officials, reducing tax auditing frequencies and bruiting that about in order to attract businesses. It’s probably no coincidence that Bavaria and Hesse recently filed a lawsuit seeking to break the decades-old post-WWII reconstruction “solidarity pact” in which German states that are doing well financially pay money to German states that are not.

US state Delaware was mentioned in a “Planet Money”-style ZDF report that said it has very low taxes, very business-friendly courts, 800,000 inhabitants and 900,000 companies and is where most of the world’s firms “organize their America business.”

(E’en LEND isch ah   SHTOY er oh OZ en.)

11 years ago Short URL 2 Comments

/////////

07

Apr

Durchgangssteueroase

“Pass-through tax oasis” or “flow-through tax oasis,” in a third country; also called a Vertragssteueroase (treaty tax oasis). The fierce discussion triggered in Germany by the publication of what is being called the  “Offshore Leaks” data trove on 04 Apr 2013 has moved from international tax avoidance by individuals, usually heirs in journalists’ examples, to international tax avoidance by companies, not least because these schemes do require a complex web of service providers and subsidiaries to move the money around. So, say your company earns income in a foreign country where your country has a double taxation agreement* with that country’s government not to tax it. As a first obfuscatory step, you can transfer this money to a Durchgangssteueroase, a third country that also has a nontaxation agreement with the country where you earned the income. The Netherlands is one of the world’s biggest pass-through tax oases because of agreements they’ve made with Asian countries that do a lot of manufacturing.

Income can thus be transferred out of high-tax countries to a pass-through tax oasis such as Mauritius to a zero tax oasis (Nullsteueroase) such as the Cayman Islands. Hans-Lothar Merten’s book “STEUEROASEN Ausgabe 2013: Neue Einblicke in die Offshore-Welt” explains that countries acting as pass-through tax oases justify being the first step in the chain by saying they are providing an important service in avoiding double taxation but, he says, what they are providing is in fact double nontaxation. ~20 trillion euros flowed through the Netherlands in this manner in 2012, Merten said [p. 29]. Ireland has provided useful related services.

German media are also reporting, or perhaps repeating each other’s examples of, perfectly legal situations where international companies’ foreign subsidiaries reduce their local net income by paying high licensing fees—for the rights to use their parent company’s brand—to subsidiaries in low-tax countries, perhaps while also deducting their expenses in high-tax countries.

(DOER chh GONGZ SHTOY er oh OZ iss.)

* Durchgangssteuerungsabkommen, “double taxation agreement,” “double tax treaty”: country A makes a (bilateral) agreement with country B to not tax income earned by country B people in country A. However, people who are residents of neither country can take advantage of the advantages by hiring an intermediary. The result is international flows of capital that are, writes Hans-Lothar Merten, inexplicable for any reason other than double taxation agreements and so-called “treaty shopping.” He cites the example of the island of Mauritius, which has double taxation agreements with ~50 other countries. Cyprus had them with ~45 countries, according to Wikipedia, with more in negotiation.

11 years ago Short URL Comments

///////////

06

Apr

Kapitalverschleierung über Steueroasen

“Using tax oases to veil capital.” Methods for doing this were disclosed by financial data about 130,000 people, in 170 countries, >120,000 “mailbox companies,” >260 GB in >2 million documents from a time range of ~30 years sent anonymously to the International Consortium of Investigative Journalists over a year ago. The story hit the world press on 04 Apr 2013. Greek and Filipino tax authorities announced that they will be investigating. The vice president of Mongolia‘s parliament will probably have to resign. Some of the still-legal methods to create tax opacity to be gleaned from the data were shown to have been used by the Deutsche Bank in Singapore, which had an intermediary agent (Trustverwaltungsfirma, “trust administrator company”) create >300 companies in so-called tax paradises (Steuerparadise).

In response: Gerhard Schick (Green Party) suggested Germany follow France’s example of levying an additional tax on all transactions with low-tax countries, disincentivizing tax flight (Steuerflucht) by neutralizing the advantages. Joachim Poß (SPD) proposed “an international anonymous NGO and a comprehensive information exchange, starting here in Europe.” The Leftists party proposed following the USA’s example of linking tax obligations to citizenship, so that every German residing abroad would be obligated to report “their total income every year, how much property they owned in total and what taxes they had had to pay for that in the Seychelles that year. And the difference between that and their German tax obligation” would then have to be paid in Germany, said Gregor Gysi (Die Linken).

The Süddeutsche Zeitung reported that they and NDR were the two German media outlets given access to the data (of “the biggest leak in world history”), and furthermore that a representative of Finance Minister Wolfgang Schäuble requested access to the data on Thursday, 04 Apr 2013, but the SZ would not grant that request. The data were protected under freedom of the press (Pressefreiheit), which includes protecting one’s sources, the Süddeutsche wrote. Sharing the data with government authorities might endanger those sources and obstruct the SZ’s ongoing research. NDR also refused the request to share the data. Now Focus magazine seems to have acquired the data somehow.

Update on 06 Apr 2013: “I have a certain degree of pleasure from the fact that this public scandalization in all countries has very much increased the pressure,” said German finance minister Wolfgang Schäuble with quiet satisfaction on 05 Apr 2013. “And now we have better chances to make progress faster than was possible in the past.”

Critics say the German finance minister has to be kidding because everyone’s known about this for years. If Schäuble were serious, they say, his office would be drafting new legislation. Income tax is regulated state-by-state in Germany, for example, and some people are calling for it to be centralized, made into a uniform federal-level taxation system with fewer “tax bait” niches. The OECD seems to be the locus for international negotiations in response to the new information; that group wants to issue a list of proposed actions in response to the “Offshore Leaks” data trove by July 2013.

(Cop ee TALL fer SHLY er oong   üüüberrr   SHTOY er oh OZ en.)

11 years ago Short URL Comments

///////////////

05

Apr

Vertrag zur Kontrolle des Waffenhandels

Arms control treaty passed on 02 Apr 2013 by the United Nations’ General Assembly after seven years of negotiations. The world’s first international agreement for controlling conventional weapons, “from pistols to panzer tanks,” it must still be ratified by fifty countries. States that sign the treaty agree not to export arms to countries where it appears that they might be used in crimes against humanity; one controversial point in the agreement is that it allows distribution of weapons to rebel groups if the shipments “serve to aid freedom and stability in the world.” The USA insisted on leaving that one in.

Update on 25 Sep 2013: The U.S. secretary of state signed the U.N. Arms Trade Treaty. Amnesty International praised this, noting that the U.S.A. is the world’s biggest weapons exporter, selling ca. 1/3 of the world’s arms trade to ~170 countries. 86 countries have signed the A.T.T.

(Fer TROG   tsoor   con TROLL eh   dess   VOFF en hon dellz.)

11 years ago Short URL Comments

///

04

Apr

Seelensorge

“Care for the soul.” The CyprusAID combination food bank distribution and free outdoor concert on 01 Apr 2013 was mostly to bring people together and show that they are cared for, that they’re not facing these problems alone.

(ZAY len ZORG ah.)

11 years ago Short URL Comments

////

03

Apr

Private Tageszeitungen

“Private daily newspapers.” On 01 April 2013, for the first time in fifty years, you could buy nongovernment newspapers on the streets of Myanmar. There are now four daily papers there to choose from.

The Myanmar government is planning a controversial new media law that may re-impose censorship.

11 years ago Short URL Comments

/////////

02

Apr

Leuchtfeuer: Richtfeuer: Oberfeuer, Mittelfeuer, Unterfeuer; Leitfeuer: Molenfeuer, Einfahrtsfeuer; Quermarkenfeuer; Torfeuer, Uferfeuer

“Light fires,” beautiful lighthouse signal lights used to guide ships in darkness or other low-visibility conditions. There’s a bewildering but quite satisfying variety in German.

  • Guide fire (Leitfeuer): single lights used in a sectors system to communicate safe passages to ships; can use color, blinking rhythm, &c. (LIGHT foy ah.)
  • Jetty fire (Molenfeuer), entryway fire (Einfahrtsfeuer): a guide light on the end of a harbor’s wall or breakwater. (MOLE en foy ah,   EYE n fah rtsfoy ah.)
  • Crossways fire (Quermarkenfeuer): sector lights perpendicular to the channel. As in the Leitfeuer system, the middle sector is the safe passage and the outer sectors indicate a course correction is necessary. (KVER mark en foy ah.)
  • Directional fires (Richtfeuer) mark navigable channels with a top fire (Oberfeuer) and bottom fire (Unterfeuer) and—more rarely—a center fire (Mittelfeuer), aligned so that to ships in the channel they appear directly behind one another. (RICHHT foy ah, OH berr foy ah, OON terr foy ah, MITT ellll foy ah.)
  • Gate fire (Torfeuer), bank fire (Uferfeuer): lights along a riverbank.

(LOY chh t foy ah.)

 

11 years ago Short URL Comments

///////

01

Apr

Gießkannenprinzip

“Watering can principle,” in which subventions are distributed evenly throughout a group without regard to individual needs or priorities, a principle some European arms exporters say they won’t follow if allowed to resume exporting weapons to Syrian rebels. They say they will only give guns to good guys. The UK and France don’t want to renew the EU’s embargo on Syrian arms shipments, which is about to expire.

Update on 27 May 2013: Because the member states could not reach a unanimous decision, the EU embargo on sending more weapons to Syrian rebels will expire. The UK indicated they were only proposing voting against renewal of the embargo because they want to increase pressure on the Assad family (which is currently fighting to the death, of all its members, unless they agree to a better solution at the upcoming peace talks in Switzerland). We shall see whether France and the UK now indeed export more weapons to that corner of the world.

(GEESE Cannes en prints EEP.)

11 years ago Short URL Comments

///////////

Blog at WordPress.com.