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Today’s Top Headlines

French Government Forces Banks To Increase Transparency

by Ulrika Lomas,, Brussels

23 June 2009

Intensifying the pressure on its banks, the French government is introducing a new measure requiring all French banks to disclose information regarding their links to tax havens. Indeed, eager to make this compulsory measure widespread, the French government is expected to try to convince other countries to follow suit at the next G20 summit meeting.

Following a vote last week on the law pertaining to the merger of the Caisse d’Epargne and the Banque Populaire, creating the country’s second largest bank, credit institutions in France are now legally obliged to publish information in their annual accounts regarding their activities in jurisdictions deemed “uncooperative” in tax matters.

The move marks a significant departure, since until now banks were only accountable in terms of their transparency to the “commission bancaire” or national regulator.

President of Transparency International France Daniel Lebègue welcomed the decision, while acknowledging that the measure is in no way intended to condemn the presence of French banks in these territories.

Pressure on French banks has mounted since the start of the global financial crisis. Last week, Budget Minister Eric Woerth indicated that the links between the banks and tax havens needed to be clarified, while back in April, French President Nicolas Sarkozy urged all credit institutions to behave in an “exemplary” manner in this matter.

Although the precise details of the measure are as yet unclear, a ministerial order is expected to follow in October.

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