1 00:00:00,380 --> 00:00:13,920 *Music* 2 00:00:13,920 --> 00:00:19,430 Herald Angel: So, they say that the only certainties in life are death and taxes 3 00:00:19,430 --> 00:00:23,900 and even hackers have decided that death is easier to cheat. 4 00:00:23,900 --> 00:00:27,669 [Pause] Life is about to get, way more interesting 5 00:00:27,669 --> 00:00:32,920 for more than 60 million Europeans, and we're going to find out why here is the 6 00:00:32,920 --> 00:00:36,040 taxman with the international exchange of tax information. 7 00:00:36,040 --> 00:00:37,850 Why don't we give him a huge round of applause? 8 00:00:37,850 --> 00:00:45,310 *Huge applause* 9 00:00:45,310 --> 00:00:48,140 Taxman: C3 rocks! Yeah, thanks for being 10 00:00:48,140 --> 00:00:54,541 here I deal with this stuff every day and I'm happy that some other people are 11 00:00:54,541 --> 00:01:00,050 interested in this because I have the impression the subject hasn't really made 12 00:01:00,050 --> 00:01:05,530 its way into the public. There's a lot of ignorance out there even among 13 00:01:05,530 --> 00:01:10,500 specialists. So, thank you very much for listening to what I have to go through 14 00:01:10,500 --> 00:01:18,920 nearly every day. What am I going to talk about? First, what are FATCA and CRS? 15 00:01:18,920 --> 00:01:27,350 FATCA is the Foreign Account Tax Compliance Act. CRS, Common Reporting 16 00:01:27,350 --> 00:01:34,290 Standard. From now on don't remember what it stands for. It's FATCA and CRS. I'll 17 00:01:34,290 --> 00:01:39,420 give you some practical advice how FATCA affects you and what you can do about it. 18 00:01:39,420 --> 00:01:45,729 And, at the end, since we're on the political section here at CCC I would like 19 00:01:45,729 --> 00:01:54,520 to venture 2 or 3 thoughts on what FATCA and CRS means for, let's say, society as a 20 00:01:54,520 --> 00:02:02,390 whole. Let's see, here we are! This is the most important slide of my talk, so, if 21 00:02:02,390 --> 00:02:10,270 you got this one you can go home. What is going... What's going on here? You, the 22 00:02:10,270 --> 00:02:17,990 listeners, we're the pink dudes. [Pause] 23 00:02:17,990 --> 00:02:22,020 *Rattling sounds* ...with bank accounts, financial 24 00:02:22,020 --> 00:02:28,890 institutions and the parlance of FATCA and CRS. Banks will collect information from 25 00:02:28,890 --> 00:02:34,781 us, forward it to the local tax administration. In this case, the 26 00:02:34,781 --> 00:02:41,070 Luxembourg flag suggests we're in Luxembourg. The Luxembourg tax 27 00:02:41,070 --> 00:02:46,370 administration will collects this information and forward it to the 28 00:02:46,370 --> 00:02:52,200 designated countries. On the top, we see a foreign tax administration that doesn't 29 00:02:52,200 --> 00:03:00,010 have a flag. Imagine there's an American flag there. FATCA deals with forwarding 30 00:03:00,010 --> 00:03:06,590 information from - the German, Luxembourg, French, etc, tax administration's - to the 31 00:03:06,590 --> 00:03:16,170 United States. CRS the Common Reporting Standard took the idea, the model of the 32 00:03:16,170 --> 00:03:25,150 American's, copied it and convinced about a 100 nations to sign up. Here in the 33 00:03:25,150 --> 00:03:32,340 example, we see Germany, France, but China is among the nations that will receive and 34 00:03:32,340 --> 00:03:39,340 provide information. Russia is there, Chile is there, just imagine the list of 35 00:03:39,340 --> 00:03:46,620 signatories to the MCAA another abbreviation to the convention that was 36 00:03:46,620 --> 00:03:54,980 signed on the 29th of October 2014 grows every day. 101 Nations is already pretty 37 00:03:54,980 --> 00:04:03,870 big. If you look at this schema or at this structure there's something funny. They 38 00:04:03,870 --> 00:04:11,500 want information about you but they're not gonna ask you. Who are they gonna ask? 39 00:04:11,500 --> 00:04:18,620 Your bank. Banks are gonna get fined, banks are gonna get in trouble. But they 40 00:04:18,620 --> 00:04:26,240 gonna forward your information. One of the problems with FATCA and CRS is that the 41 00:04:26,240 --> 00:04:33,570 terms are rather vague and ill-defined. You think "yeah I've got a bank, I can 42 00:04:33,570 --> 00:04:40,860 handle my bank no problem" but have you ever thought that your lawyer might need 43 00:04:40,860 --> 00:04:47,979 to forward your information? Meaning you're a foreign -- you're a foreigner the 44 00:04:47,979 --> 00:04:53,550 lawyer in his ordinary course of business accepts deposits -- in this case retainers 45 00:04:53,550 --> 00:04:58,819 and client funds -- and has to forward this information. 46 00:04:58,819 --> 00:05:04,700 Many lawyers are not aware of this, I believe the law is ambiguous, the reason 47 00:05:04,700 --> 00:05:13,419 why I take lawyers as an example FATCA and CRS are pretty identical. Under FATCA the 48 00:05:13,419 --> 00:05:18,999 Germans negotiated that lawyers don't have to report any information, under CRS we 49 00:05:18,999 --> 00:05:26,650 don't have this exception. So, vague terms, ill-defined terms and a 50 00:05:26,650 --> 00:05:33,681 huge amount of data being thrown around in the world. I was introduced with the 51 00:05:33,681 --> 00:05:41,680 example of PayPal, PayPal in Luxembourg. My guesstimate is -- according to SEC 52 00:05:41,680 --> 00:05:47,009 filings, PayPal has about 150 million accounts, Europe is an important market, 53 00:05:47,009 --> 00:05:52,130 60 million accounts in Europe -- the tax administration's are going to receive 60 54 00:05:52,130 --> 00:05:58,949 million notifications about PayPal balances and that's not all I mean think 55 00:05:58,949 --> 00:06:07,399 about your bank whether your hold shares, whether you have the normal -- how do you 56 00:06:07,399 --> 00:06:13,069 call it -- deposit, a deposit account, a savings account all this information is 57 00:06:13,069 --> 00:06:18,840 going to be forwarded. Who is particularly affected? People with connection to 58 00:06:18,840 --> 00:06:26,020 foreign countries. The guy in pink will be a person with the contact, with the 59 00:06:26,020 --> 00:06:30,550 relationship, to a foreign country, I will show you what this relationship can look 60 00:06:30,550 --> 00:06:41,789 like. Okay we're at CCC, XML schema, nothing new for you, it's a tree. Don't 61 00:06:41,789 --> 00:06:47,460 worry, the more interesting stuff is going on here; the ambiguities in the schema. 62 00:06:47,460 --> 00:06:53,060 It is promoted by the OECD, the Organization for the Economic Cooperation 63 00:06:53,060 --> 00:06:57,479 and Development. Cooperation and development sound so good and at the end 64 00:06:57,479 --> 00:07:04,440 they just pass our tax information around. Some of the problems here, one of the 65 00:07:04,440 --> 00:07:12,029 problems, transliteration; a hundred and one nations as of December signing up. 66 00:07:12,029 --> 00:07:15,750 What about the information we're going to get from China? Are they gonna send 67 00:07:15,750 --> 00:07:23,530 Chinese characters? And imagine there's a German in China. A friend of mine, Robert, 68 00:07:23,530 --> 00:07:31,159 his name in China is 罗伯特, how is this information gonna come back? If you look 69 00:07:31,159 --> 00:07:37,979 at Bulgaria you have Cyrillic, Cyrillic, if you transliterate it to German is 70 00:07:37,979 --> 00:07:43,939 transliterated in a special way, the Germans have a DIN, a norm, to 71 00:07:43,939 --> 00:07:48,379 transliterate Cyrillic. That norm is not identical with how the French 72 00:07:48,379 --> 00:07:55,740 transliterate Cyrillic characters, so if the Germans ask about suspicious character 73 00:07:55,740 --> 00:08:00,639 Anton Chekhov and ask the French authorities, they might not talk about the 74 00:08:00,639 --> 00:08:05,550 same guy, because the spelling is slightly different. 75 00:08:05,550 --> 00:08:14,521 the ambiguities in this schema are in a way more irksome because here I just have 76 00:08:14,521 --> 00:08:20,900 three nodes, the header, the financial information-- financial institution and 77 00:08:20,900 --> 00:08:29,759 the person or account information. The OECD went overboard and has meta 78 00:08:29,759 --> 00:08:37,510 information on each of those nodes, describing what type of information is 79 00:08:37,510 --> 00:08:43,340 supposed to follow. So what's going to happen -- or how is anybody to interpret 80 00:08:43,340 --> 00:08:49,640 information where in the header you say it's new, on the FI node you say it's 81 00:08:49,640 --> 00:08:55,640 corrected and then the person/ account info you say it's gonna be deleted. How 82 00:08:55,640 --> 00:09:03,960 are we going to resolve this? For me an example of lawyers and technology, meaning 83 00:09:03,960 --> 00:09:11,030 anybody who works with this, will have some pain and suffering. 84 00:09:11,030 --> 00:09:18,370 Okay, practical advice. First of all, what type of information is going to be 85 00:09:18,370 --> 00:09:24,210 reported. You see here the name, address, the 86 00:09:24,210 --> 00:09:29,651 jurisdictions of residence, TINs, that's a tax payer information number, and the date 87 00:09:29,651 --> 00:09:33,600 of place of birth. So at one point I was trying to make the 88 00:09:33,600 --> 00:09:41,160 presentation a little more visual and I was looking for images for place-- place 89 00:09:41,160 --> 00:09:47,220 of birth and I found somebody who wrote to this-- to this request to provide this 90 00:09:47,220 --> 00:09:52,330 information -- home delivery. No that's not what is meant when the OECD asked for 91 00:09:52,330 --> 00:10:01,440 the place of birth it's the date of birth is important. If you have two Pierre 92 00:10:01,440 --> 00:10:08,990 Dupont that's the way to keep them apart, meaning your birth date information is 93 00:10:08,990 --> 00:10:15,610 relevant to keep you apart from other people having your name. The information 94 00:10:15,610 --> 00:10:22,810 itself is fairly technical, there's nothing really going overboard. The idea 95 00:10:22,810 --> 00:10:29,750 of FATCA and CRS was to catch individual tax cheats. We're not talking about 96 00:10:29,750 --> 00:10:37,520 corporations dodging taxes or anything. We are trying to-- or FATCA is trying to 97 00:10:37,520 --> 00:10:42,870 catch people who evade taxes. How did Americans in particular evade taxes in the 98 00:10:42,870 --> 00:10:51,060 past? They had a trip to the Bahamas with the suitcase full of money and deposited 99 00:10:51,060 --> 00:10:56,240 the money in an account there. Maybe they got a credit card and used the credit card 100 00:10:56,240 --> 00:11:02,310 in the United States to live off the interest that the account accumulated. 101 00:11:02,310 --> 00:11:09,720 Since Bahamas, Cayman Island, Turks, Caicos didn't have any exchange in regards 102 00:11:09,720 --> 00:11:14,500 to this information with the United States. These Americans went home free 103 00:11:14,500 --> 00:11:19,930 thus cheating the taxman. Later on they became a little smarter, instead of 104 00:11:19,930 --> 00:11:27,440 signing up for an account themselves they created corporations or trusts. So it's no 105 00:11:27,440 --> 00:11:32,790 longer in the name of your own name but in the name of your trust that you hold these 106 00:11:32,790 --> 00:11:41,860 funds. So the information that the banks are forwarding, is actually -- how to say 107 00:11:41,860 --> 00:11:48,000 -- it's fairly technical, they are not going overboard. That having said you 108 00:11:48,000 --> 00:11:53,220 might disagree with the whole idea of tax exchange-- of exchanging tax information 109 00:11:53,220 --> 00:12:01,450 but this is basically what you expect to see when you're looking for tax cheats. 110 00:12:01,450 --> 00:12:09,310 Number 5, not only your account balance as of the 31st of December so you still have 111 00:12:09,310 --> 00:12:15,570 a chance to change that today and tomorrow, if you take all the money out 112 00:12:15,570 --> 00:12:21,810 then nothing is gonna be reported, and your dividends and gross proceeds of-- 113 00:12:21,810 --> 00:12:28,040 gross proceeds for the sale of shares or other financial assets is going to be 114 00:12:28,040 --> 00:12:36,760 reported. That's-- that's a lot. Okay how do banks 115 00:12:36,760 --> 00:12:47,280 find out whether you are a potential tax cheat? I listed the three main criteria 116 00:12:47,280 --> 00:12:53,070 they're looking for. They ask you-- or if they know whether you're resident of 117 00:12:53,070 --> 00:12:59,760 reportable jurisdiction; if you are an American your birth certificate is 118 00:12:59,760 --> 00:13:05,351 sufficient. I've seen it with other banks that they come around now to ask "Show me 119 00:13:05,351 --> 00:13:09,950 a birth certificate", if you're an American, your information is gonna be 120 00:13:09,950 --> 00:13:17,810 reported to the United States, to the IRS. If you give the-- a mailing address or a 121 00:13:17,810 --> 00:13:25,760 residence address in a country abroad, that similar will trigger the bank to look 122 00:13:25,760 --> 00:13:31,120 a little more carefully at your account. What banks typically do is when they find 123 00:13:31,120 --> 00:13:38,800 this information they send you a self- certification. They ask you "Please 124 00:13:38,800 --> 00:13:48,940 certify this information". They basically ask you "Were your tax resident and is the 125 00:13:48,940 --> 00:13:56,300 mailing address correct?". And think about number three: Phone numbers. The phone 126 00:13:56,300 --> 00:14:03,130 number the bank has on record will trigger this additional search or sending out the 127 00:14:03,130 --> 00:14:09,260 self-certification form. Meaning, you've got a Google number with a zero zero one 128 00:14:09,260 --> 00:14:14,780 country code your bank is gonna ask you and if you don't respond, they're gonna 129 00:14:14,780 --> 00:14:22,990 send this information to the United States. Your tax account information. 130 00:14:22,990 --> 00:14:31,380 What can you do about it? Be local. Meaning check with your bank, whether all 131 00:14:31,380 --> 00:14:37,760 the information the bank has on file about you reflects a local residence. I have 132 00:14:37,760 --> 00:14:42,650 heard -I cannot verify it- that certain countries make this a business by 133 00:14:42,650 --> 00:14:50,400 providing easy resident certificates, meaning you can go to countries so easily 134 00:14:50,400 --> 00:14:58,310 obtain a certificate of residence then go to your bank and open an account. When the 135 00:14:58,310 --> 00:15:04,320 bank is reviewing the information it sees taxman local guy. 136 00:15:04,320 --> 00:15:08,820 This information doesn't have to be forwarded to another country because he 137 00:15:08,820 --> 00:15:18,040 supposedly is paying his taxes locally. Is there a legal option; is there a legal 138 00:15:18,040 --> 00:15:25,880 opportunity or is there a case for lawyers here? It's a little doubtful. 139 00:15:25,880 --> 00:15:32,850 In Germany, the Germans changed the law in the fiscal code regarding the 140 00:15:32,850 --> 00:15:40,500 consultation. Typically, or before the automatic exchange of tax information, the 141 00:15:40,500 --> 00:15:47,390 Germans asked you, consulted you, gave you a chance to voice your objections, before 142 00:15:47,390 --> 00:15:52,390 they would forward your information to another country. For automatic exchange of 143 00:15:52,390 --> 00:16:00,301 information like FATCA and CRS, this is no longer the case. Nevertheless, there has 144 00:16:00,301 --> 00:16:08,811 been a case in Germany decided by the fiscal court in Cologne, where the German 145 00:16:08,811 --> 00:16:14,170 tax administration wanted to forward information to the Turkish government in 146 00:16:14,170 --> 00:16:18,960 regards to some payment, a German company has made. 147 00:16:18,960 --> 00:16:27,050 So, the German company thought, their contact and Turkey would be burnt and they 148 00:16:27,050 --> 00:16:37,070 provided an expert opinion, that turkey does not safeguard tax information. The 149 00:16:37,070 --> 00:16:42,820 Turkish finance minister claimed the country, but the court was not convinced. 150 00:16:42,820 --> 00:16:50,090 So the court in Cologne said: "German tax administration, you can not forward this 151 00:16:50,090 --> 00:16:59,050 information to a country that doesn't follow data privacy laws!" Let's look at 152 00:16:59,050 --> 00:17:04,480 FATCA and CRS. We're talking about 60 million; hundred million accounts being 153 00:17:04,480 --> 00:17:12,919 distributed all over the world. The courts are not -I believe- not going to shoot 154 00:17:12,919 --> 00:17:20,409 down CRS and FATCA. They will not ask the tax administration to hear you, before 155 00:17:20,409 --> 00:17:27,470 your information is being passed on to another country. However, if you can come 156 00:17:27,470 --> 00:17:34,769 up with an expert opinion and say: "My information is gonna hurt me in Turkey or 157 00:17:34,769 --> 00:17:43,149 wherever", I believe the fiscal courts in Germany would issue an injunction, would 158 00:17:43,149 --> 00:17:51,110 prevent the German tax administration in Bonn, to forward the information. Think 159 00:17:51,110 --> 00:17:57,709 about turkey. Turkey, nothing incentive, but it's a third world country. Compared 160 00:17:57,709 --> 00:18:04,610 to any other third world country in the world, you can most likely obtain an 161 00:18:04,610 --> 00:18:10,600 expert opinion from -regarding any third world country- that they are not 162 00:18:10,600 --> 00:18:18,090 protecting data; that they are not protecting tax information in the country. 163 00:18:18,090 --> 00:18:26,690 They're gonna use it to shame you, so even though I'm not really convinced, that the 164 00:18:26,690 --> 00:18:33,940 legal solution is a good one, it will be interesting to see what the courts say in 165 00:18:33,940 --> 00:18:41,370 this regard. A little ray of hope was, that for another 166 00:18:41,370 --> 00:18:49,959 tax information exchange, the French, their Conseil d'État, recently decided, 167 00:18:49,959 --> 00:18:54,490 based on a law signed -oh, it wasn't a law, it was a decree by Louis XVI. 168 00:18:54,490 --> 00:18:57,490 *Laughter* This was, I means, 169 00:18:57,490 --> 00:19:02,039 it must have been weeks before he was beheaded 1791, that they didn't want 170 00:19:02,039 --> 00:19:06,550 to participate in this other tax information exchange, which is a country- 171 00:19:06,550 --> 00:19:13,620 by-country reporting regarding companies. So maybe -we have not heard the courts 172 00:19:13,620 --> 00:19:22,889 yet- maybe, there's still something to come. Ok, let's look at the consequences 173 00:19:22,889 --> 00:19:29,510 of this. I'm very concerned about CRS and FATCA. 174 00:19:29,510 --> 00:19:37,250 On the one hand, anybody who is a little international, might run into problems. 175 00:19:37,250 --> 00:19:42,919 For FATCA, Americans have problems opening bank accounts in Europe, because the 176 00:19:42,919 --> 00:19:48,870 European banks think, it's not worth the trouble. So Americans are complaining 177 00:19:48,870 --> 00:19:57,979 about not being able to bank outside the United States. With CRS this is a little 178 00:19:57,979 --> 00:20:05,789 different, because a hundred nations; they can't always refuse foreigners. But you 179 00:20:05,789 --> 00:20:14,110 see, that the target of FATCA and CRS are individuals like you and me, who are a 180 00:20:14,110 --> 00:20:20,820 little mobile and travel and work across the globe. Our life is a little more 181 00:20:20,820 --> 00:20:28,929 difficult with this. The other thing is: If you think that you want to create a 182 00:20:28,929 --> 00:20:38,799 start-up in the space, the compliance burden is very high. This type of law 183 00:20:38,799 --> 00:20:43,570 prevents starts of innovation in the space. 184 00:20:43,570 --> 00:20:51,140 That's it already. I hope you have some questions, so I can elaborate a little 185 00:20:51,140 --> 00:20:57,320 more on individual details, that you might be interested in. Thank you very much. 186 00:20:57,320 --> 00:21:04,260 *Applause* 187 00:21:04,260 --> 00:21:07,230 Herald: Great! So, questions. If you have a question: Again, 188 00:21:07,230 --> 00:21:10,331 please, the microphones are here and here in the aisles, so 189 00:21:10,331 --> 00:21:14,160 already in the back. Person 1 from audience: Yeah, hi! I was 190 00:21:14,160 --> 00:21:18,110 wondering, if it was possible to know, if the information has already been traded or 191 00:21:18,110 --> 00:21:21,210 sent to other countries or things like that. 192 00:21:21,210 --> 00:21:28,480 Taxman: FATCA was originally implemented in 2010. The first exchange, I mean banks 193 00:21:28,480 --> 00:21:36,170 were required to submit the information, on the 30th of June 2015. So we've already 194 00:21:36,170 --> 00:21:41,459 seen two rounds of exchanging data with the United States. For the Common 195 00:21:41,459 --> 00:21:47,140 Reporting Standard, CRS, we're going to see the first exchange next year. Until 196 00:21:47,140 --> 00:21:53,099 the 30th of June, banks were required to submit the information, until the 30th of 197 00:21:53,099 --> 00:21:57,280 June. The tax administration itself has three more months, until the 30th of 198 00:21:57,280 --> 00:22:03,740 September, to forward the information to the respective countries. 199 00:22:03,740 --> 00:22:06,680 Herald: Great! Do we have a question from the internet? 200 00:22:06,680 --> 00:22:12,100 Angel: Yes. Somebody on IRC wants to know, because when you have an American social 201 00:22:12,100 --> 00:22:17,330 security number or someone, you can commit identity theft. Is the problem the same 202 00:22:17,330 --> 00:22:21,619 for German tax IDs or are they more immune to that? 203 00:22:21,619 --> 00:22:28,370 Taxman: To be honest... Okay, 2 parts to the answer: a) I'm not an expert on German 204 00:22:28,370 --> 00:22:34,529 tax numbers and identity theft, in the United States social security number is a 205 00:22:34,529 --> 00:22:39,039 lot more important. So, once you have social security number, you get loans and 206 00:22:39,039 --> 00:22:44,929 everything else. Typically when you apply for a loan with a car or wherever, you 207 00:22:44,929 --> 00:22:48,580 don't -- at least according to my experiences, which is very limited -- you 208 00:22:48,580 --> 00:22:55,269 don't provide your German social security number. The encryption of the information 209 00:22:55,269 --> 00:23:01,490 etc. is something I would not be worried about. I mean encryption in this space is 210 00:23:01,490 --> 00:23:08,029 a solved problem and the tax administration, they'll follow best 211 00:23:08,029 --> 00:23:15,660 practices, so that the information is going to be used by third party, I 212 00:23:15,660 --> 00:23:22,429 believe, is not a major problem. The other thing is, however, that everybody is 213 00:23:22,429 --> 00:23:26,140 basically considered... everybody who has connection with a foreign country is 214 00:23:26,140 --> 00:23:31,049 basically considered a tax cheat and will be treated differently from local 215 00:23:31,049 --> 00:23:37,860 residents. That is a problem I see. Herald: All right. From up front. 216 00:23:37,860 --> 00:23:41,370 Person 2 from audience: So, I've had the displeasure of having to file an F bar 217 00:23:41,370 --> 00:23:45,929 and, as part of the F bar, it asked for the highest amount of money in my account 218 00:23:45,929 --> 00:23:51,250 at any point in time in the year. And I filled all that out and so forth, as 219 00:23:51,250 --> 00:23:57,389 condescending as it was, but now you're saying the fact, actually, now wants to 220 00:23:57,389 --> 00:24:01,410 report my amount of money at the end of the year. The two are completely 221 00:24:01,410 --> 00:24:04,860 incongruent! Like how... I mean you're kind of spelling out that there's going to 222 00:24:04,860 --> 00:24:09,019 be a giant data mess. Is this going to factor into that? Do have any thoughts on 223 00:24:09,019 --> 00:24:14,690 this? Taxman: As I mentioned about FATCA, the 224 00:24:14,690 --> 00:24:21,380 date to report information is the 31st of December; that's for account balances. For 225 00:24:21,380 --> 00:24:30,539 sale of shares, any time during the year. For information regarding interest and 226 00:24:30,539 --> 00:24:37,309 dividends, any time during the year. Talking about "data mess": Yes, I'm pretty 227 00:24:37,309 --> 00:24:45,259 much convinced this will be a huge data mess. Think about for Germany: German 228 00:24:45,259 --> 00:24:55,341 public servants receiving 20 million records -- and this is only PayPal, we're 229 00:24:55,341 --> 00:25:01,009 not talking about credit cards, we're not talking about bank accounts. This is just 230 00:25:01,009 --> 00:25:08,110 one measly little company. So, and it's not only the Germans, and, by the way, 231 00:25:08,110 --> 00:25:12,799 American tax administration was completely overwhelmed by the implementation of 232 00:25:12,799 --> 00:25:19,590 FATCA. You could see it that they changed the technical requirements by changing the 233 00:25:19,590 --> 00:25:25,029 FAQs on the website. So, you went to the website a week later and found out "Oh, 234 00:25:25,029 --> 00:25:30,889 there're 10 new special characters we can't use", so the tax administrations 235 00:25:30,889 --> 00:25:35,720 across the globe, they are overwhelmed, and what's going to happen with these 236 00:25:35,720 --> 00:25:44,159 data... It will depend on each country and the data privacy standards. I mean, the 237 00:25:44,159 --> 00:25:50,850 Germans take this very seriously, but think about a small country whether it's 238 00:25:50,850 --> 00:25:59,049 Luxembourg or some country in the Caribbean, Panama: These guys, they lack 239 00:25:59,049 --> 00:26:03,340 certain practices; they haven't been, so to speak, under attack; they haven't been 240 00:26:03,340 --> 00:26:11,789 able to develop the defenses. So, a lot of data will float around the internet in the 241 00:26:11,789 --> 00:26:15,739 end, I believe. Herald: Okay, we have time for one short 242 00:26:15,739 --> 00:26:20,330 one and a very short answer, so can we go to the front here? 243 00:26:20,330 --> 00:26:24,600 Person 3 from audience: Yeah, one question: In which country are you tax 244 00:26:24,600 --> 00:26:29,369 resident when you are living in several countries for quite a long time in the 245 00:26:29,369 --> 00:26:32,799 year? For instance, 3 countries, four months. How is it decided? 246 00:26:32,799 --> 00:26:38,519 Taxman: Very good question and banks are supposed to figure this out, but banks ... 247 00:26:38,519 --> 00:26:43,230 *quiet laughter* Yeah, I mean the bank has to report, so banks are overwhelmed, so 248 00:26:43,230 --> 00:26:51,519 that makes you an expert in the different laws of each jurisdiction you're in. For 249 00:26:51,519 --> 00:26:59,119 Germany, I believe it's 183 days residence here. In the United States and Eritrea... 250 00:26:59,119 --> 00:27:04,480 Hey, something Eritrean and the United States have in common, place of birth is 251 00:27:04,480 --> 00:27:12,710 enough. In Eritrea, I was told, paying taxes more of an option, but okay. 252 00:27:12,710 --> 00:27:17,970 *laughter* So you are... the bank will ask you on the self-certification "Where are 253 00:27:17,970 --> 00:27:23,560 your tax resident?" and you are supposed to know, which is a little painful. I 254 00:27:23,560 --> 00:27:27,660 mean, you're for 4 months in the country. Are you tax resident? You don't know the 255 00:27:27,660 --> 00:27:33,480 funny tax laws everybody has. So, the burden is on you. I mean, the bank tries 256 00:27:33,480 --> 00:27:38,870 to put the burden on you, because you're not going to get fined, the bank is going 257 00:27:38,870 --> 00:27:43,610 to get fined. Herald: Great. Let's give the taxman a 258 00:27:43,610 --> 00:27:54,169 warm round of applause. [Applause] 259 00:27:54,169 --> 00:28:14,879 [Music]