Extremist French Committee Attacks Luxembourg

by Ulrika Lomas, Tax-News.com, Brussels

24 January 2002

Luxembourg yesterday became the latest European financial centre to be branded a haven for tax evasion and money laundering by a notorious French parliamentary committee dominated by extreme left-wing deputies which has attacked Monaco, Gibraltar, the City of London and Switzerland, among other well-known centres of international criminality.

The committee issued a scathing report on Luxembourg's tax regime, its banking secrecy laws and its record on co-operation in cross-border financial investigations. Arnaud Montebourg, the parliamentarian who complied the report, reserved venom for Luxembourg financial trusts that allow the owners of a company to remain anonymous.

Vincent Peillon, the committee's chairman, said Luxembourg had yielded to international pressure in recent years. "But they must go further and ... faster."

The report also drags out again allegations over supposed malpractice at Clearstream, the Luxembourg-based securities clearing house half-owned by Deutsche Borse, which led to the resignation of its ceo - but several extensive enquiries by Luxembourg and international authorities failed to uncover any substance to the allegations.

Luc Frieden, Luxembourg's justice minister, rejected the report, saying it was intended for a French domestic audience. Indeed, the Deputies responsible for the report need not be taken too seriously - although not exactly disowned by the French Government, they are regarded as harmless. After the renegade deputies issued their report on Gibraltar, a prominent minister said: "The French MPs appear simply to have embarked on a general campaign against finance centres based on prejudices and preconceptions that they have been unwilling to discard even when faced with the facts."

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