The Paris-based Accidental Americans Association today filed a complaint with the European Commission against the way France is using an inter-governmental agreement with the U.S. to enforce the so-called Foreign Account Tax Compliance Act, which, the AAA says, is in breach of European Union law.
The filing of the complaint comes less than three months after France's high court, the Conseil d'Etat, rejected a similar complaint brought by the AAA, which claims FATCA is causing serious harm to many dual U.S./French citizens.
At the time, AAA president Fabien Lehagre noted that "several" of the AAA's arguments had been completely ignored by the French court, including what he said was the FATCA IGA's lack of reciprocity, possibly due to the fact of the matter being "an extremely political subject," and vowed to continue to challenge the IGA's legality.
In its complaint, the AAA alleges that the U.S-France Intergovernmental Agreement (IGA) of Nov. 14, 2013, which sets out how France-based financial institutions, such as banks and insurance companies, are able to make use of French government agencies to comply with the 2010 U.S. anti-tax evasion law, violates EU law by obliging them to transmit the sensitive financial data of all of their American clients to the U.S. tax authorities.
Today, in a statement, the AAA, which is known in France as l’Association des Américains Accidentels, said: "The [AAA] considers that the IGA infringes the EU General Data Protection Regulation (EU) 2016/679 [GDPR] by authorizing the massive storage and transmission to the United States of the personal data of numerous individuals identified as 'U.S. persons'.
"The mechanism takes no account of the fact that most of these individuals have no links with the United States.
"It provides no safeguards on protecting personal data, and does not enable the individuals concerned to access their transmitted data or correct any errors that occur."
The statement then quoted Patrice Spinosi, a lawyer acting on the AAA's behalf in the matter, as saying: "This lack of safeguards, coupled with the disproportionate nature of the information transmitted to the IRS, clearly violates EU law on personal data protection.
“Moreover, as the European Court of Justice has ruled, the U.S. does not give adequate protection to individuals’ fundamental rights in the treatment of their data.”
The European Commission now has 12 months from today to assess the case and decide whether to initiate a formal infringement procedure against France.
Matter of the 40,000 French 'accidentals' accounts
In a statement accompanying the announcement of the filing of the AAA complaint today, Lehagre expressed "regret" that the French government had done nothing about the problem he and France's other dual American/French citizens are having with the problems caused by FATCA, particularly given that it "is well aware that banks in France might close the accounts of 40,000 French 'Accidental Americans' by the end of the year," when an existing arrangement whereby non-U.S. financial institutions have been allowed not to comply with a FATCA requirement to provide the Social Security Number of their American account-holders is due to expire.
About that problem, Lehagre added: "The government has not started negotiating a solution to that either."
Latest FATCA pushback
The AAA's European Commission complaint is the latest in a series of legal challenges to FATCA currently under way, and an even larger number that have been launched, several of which ended in failure.
As reported here earlier this week, two dual Canadian/U.S. citizen plaintiffs in a long-running legal effort to block Canada’s implementation of the U.S.’s Foreign Account Tax Compliance Act have launched an appeal in Canadian Federal Court in Ottawa, after their most recent attempt to challenge the law was dismissed in July.
Last month, an American who came to the UK 19 years ago announced that she was seeking to legally challenge what she said was the breach of her data protection and privacy rights by the UK's HM Revenue & Customs, which, like its French counterpart in France is doing under the U.S./French FATCA IGA, is forwarding her financial and personal details to the U.S. Internal Revenue Services under a U.S./UK IGA.
The American, who is known only as Jenny, has retained the Mishcon de Reya law firm to help her, and is currently in the process of appealing to fellow Americans around the world to help her by crowd-funding her, with a donation page set up on the CrowdJustice.com site.
- EU economic chief Gentiloni to Europe's 'accidentals': 'no evidence' FATCA infringes 'basic bank account rights'
- Accidental Americans, others react, as U.S. Treasury official's response to EU FATCA concerns emerges
- Accidental Americans' Lehagre to Mike Pompeo: 'Reduce exorbitant U.S. expatriation fee'
- U.S. Treasury belatedly reveals 'regulatory reform' talks with EU
- French finance minister reassures French banks over FATCA concerns, on eve of TIN reporting deadline