(9a)

In order correctly to apply and verify the Member States’ different tax regimes, adequate information is needed on taxable activities carried out in other Member States. Of the different options, the automatic exchange of data seems to be the most effective way of communicating the current information required for accurate taxation, in particular in cross-border cases. In order to ensure the effectiveness of such automatic exchange of information, it is necessary to determine the categories and define the fields to which its application is mandatory. In addition, there should be the possibility of establishing a double limit depending on the categories for which information is communicated and/or the amount that triggers the mechanism.

(10)

The Member States should exchange automatically any information where a Member State has grounds to believe that a failure of compliance with tax laws has been committed or is likely to have been committed in the other Member State, where there is a risk of inappropriate taxation in the other Member State, or where tax has been or may be evaded or avoided for any reason in the other Member State, and especially where there is an artificial transfer of profits between enterprises in different Member States or where such transactions are carried out between enterprises in two Member States through a third country in order to obtain tax advantages.

(10)

The Member States should exchange automatically any information , while ensuring the protection of customer privacy, where a Member State has grounds to believe that a failure of compliance with tax laws has been committed or is likely to have been committed in the other Member State, where there is a risk of inappropriate taxation in the other Member State, or where tax has been or may be evaded or avoided for any reason in the other Member State, and especially where there is an artificial transfer of profits between enterprises in different Member States or where such transactions are carried out between enterprises in two Member States through a third country in order to obtain tax advantages.

(11a)

Such information should also be protected under Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (1)1 and under Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (2). The Member States and the Commission should respect the obligations relating to transparency and information with regard to the interested parties in cases involving retrieval of the personal data. An appropriate level of protection, limited storage period, and accountability of the data keeper institution or body should be ensured.

(11b)

In the cases described in recitals 9, 10 and 11, the information exchange envisaged should not result in individuals or companies being burdened with additional reporting requirements;

(12)

It is important that officials of the tax administration of one Member State are allowed to be present in the territory of another Member State and may exercise the powers of inspection conferred on officials of the requested Member State .

(12)

In order to boost cooperation between Member States’ tax administrations, it is important that officials of the tax administration of one Member State are allowed to be present in the territory of another.

(17a)

In order to enhance the applicability and effectiveness of this Directive, the same level of obligation should apply both to the communication of information already available by the requested authority and to conducting the administrative enquiries necessary to obtain such information.

(19)

However, a Member States should not refuse to transmit the information because it has no domestic interest or because the information relating to a resident of the other Member State is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.

(19)

However, a Member State should not refuse to transmit the information because it has no domestic interest or because the information is held by a bank or another financial institution, or by a nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.

(20)

It should also be made clear that where a Member State provides a wider cooperation to a third country than is provided for under this Directive, it should not refuse to provide such wider cooperation to the other Member States.

(20)

It should also be made clear that where a Member State provides wider cooperation to a third country than is provided for under this Directive, it should not refuse to provide such wider cooperation to the other Member States. Any transfer of personal data to a third country should be made in accordance with Directive 95/46/EC.

(22)

An evaluation of the effectiveness of administrative cooperation should be made, especially on the basis of statistics.

(22)

In order to strengthen and deepen administrative cooperation, an evaluation should be made of the effectiveness of the implementation of this Directive, based especially on statistics. It is also necessary to monitor cases where the Member States have refused to communicate information or conduct an administrative enquiry.

(23a)

The Commission should be empowered to adopt delegated acts in accordance with Article 290 of the Treaty on the Functioning of the European Union in respect of technical improvements to the categories of income and capital that are subject to the automatic exchange of information and to the thresholds of income and capital above which the information exchange must be carried out. In view of the specific nature of the administrative cooperation, the empowerment should be for an indeterminate period of time.

(d)

any legal arrangement, including partnerships and trusts, whose income or capital are subject to any of the taxes covered by this Directive;

(d)

any other legal instrument or arrangement, regardless of its nature or form and whether or not it has legal personality, that may own and manage assets, including income therefrom, that are subject to any of the taxes covered by this Directive;

8.

‘by electronic means’ means using electronic equipment for the processing, including digital compression, and storage of data, and employing wires, radio transmission, optical technologies or other electromagnetic means;

8.

‘by electronic means’ means using electronic equipment for the processing, including digital compression, and storage of data, and employing wires, radio transmission, optical technologies or other electromagnetic means , where such means can be conducted while guaranteeing secure protection of information ;

(a)

income from work;

(b)

directors’ emoluments;

(c)

dividends;

(d)

capital gains;

(e)

royalties;

(f)

life insurance products not covered by other Union legal instruments on the exchange of information and other similar measures;

(g)

pensions;

(h)

ownership of immovable property and income derived therefrom.

(a)

the categories of income and capital to be covered

(a)

clarify any specific condition or restriction within the categories referred to in paragraph 1;

(b)

the type of information to be exchanged;

(b)

specify for each category of income and capital the threshold above which the information exchange must be carried out.

(c)

any specific condition or restriction within the categories referred to in point (a);

(d)

the frequency of the exchanges;

(e)

the practical arrangements for the exchange of information.