The Swiss and the United States governments have agreed to settle their dispute over suspected tax evasion involving Swiss bank UBS, ending weeks of negotiations.This content was published on August 19, 2009 - 14:11
A government attorney asked a court in Florida to suspend a trial set for next Monday, saying both sides had initialled a deal.
The statement came at the latest status review on Wednesday presided by the Miami district judge, Alan Gold.
He told a telephone conference between the parties in the conflict he would cancel the trial date of August 17.
"The parties have initialled agreements. It will take a little time for the agreements to be signed in final form," US Justice Department, Stuart Gibson said.
"When the final documents are signed the parties will file a stipulation of dismissal," he added.
The settlement was expected to involve the disclosure to US authorities of the names of thousands of wealthy American clients of UBS suspected of using offshore accounts at the bank to conceal assets and dodge US takes.
Washington's legal case against UBS, the world's number two wealth manager by managed assets, had strained relations between the two countries, because it challenged Switzerland's bank secrecy laws.
"I'm pleased to see that a compromise solution has been found. This is in the interest of Switzerland and the United States," Justice Minister Eveline Widmer-Schlumpf said.
The statement adds that the agreement still has to be signed by the representatives of both states. No further details of the out-of-court settlement were revealed.
In a similar vein, the Internal Revenue Service (IRS) welcomed the agreement saying it "protects the United States government's interests".
Kaspar Villiger, chairman of the UBS board, said in a statement: "The board of directors and the management of UBS are grateful that the two governments reached this agreement to resolve this issue, and we thank the Swiss government and the Swiss delegation that negotiated this settlement for their outstanding efforts."
At the request of the US and Swiss governments, UBS has agreed not to comment further pending the formal signing of the agreement.
Details of the accord will be released as early as next week, according to the IRS.
The US government and UBS said on July 31 they had reached an agreement in principle on major issues in the case, but negotiations have focused on the legal details of how to allow the transfer of substantial UBS client data to Washington while respecting Swiss bank secrecy laws.
The case has big implications not just for Switzerland, whose private banks manage around $2 trillion (SFr2.2 trillion) of foreign wealth, but for the entire offshore banking industry.
The court case was delayed three times before since negotiations began several weeks ago.
On Tuesday Finance Minister Hans-Rudolf Merz reiterated the government ruled out again invoking emergency laws to comply with the terms of the settlement.
In February UBS paid a $780 million fine and given information on 255 clients after admitting that some of its bank employees had helped US citizens evade taxes.
The handover of confidential bank data was ordered by the government despite Swiss banking secrecy laws.
Urs Geiser, swissinfo.ch
UBS and the US
On May 14, 2008, former UBS employee Bradley Birkenfeld and a Liechtenstein businessman were charged by the US authorities with helping an American billionaire avoid paying taxes on $200 million of assets deposited in Swiss and Liechtenstein bank accounts.
Birkenfeld turned whistleblower, giving details of UBS private banking practices to US prosecutors.
In July, a Miami court authorised the Internal Revenue Service to issue a summons on UBS demanding the release of confidential information on clients the agency suspected of tax evasion.
In the same month, UBS told a congressional hearing that it would stop offshore banking activities for US clients.
UBS agreed in February to pay $780 million and name some United States clients to resolve criminal fraud charges against it. However, this did not affect a separate demand from the IRS for the details of 52,000 UBS clients, in direct contravention of Swiss banking secrecy laws.
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