ANZ Ordered that it must provide bank records to the ATO even though the accounts were opened off-shore (in Vanuatu). | Irish Bentley Laywers
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The ATO’s attack on off-shore tax havens continues, and this latest extension of Project Wickenby raises many interesting issues.

The ANZ are no doubt concerned that this decision is likely to lead to Australians only using foreign banks (not Australian banks) when transacting overseas.

In essence, the Full Federal Court has upheld the validity of a s 264 notice requiring the ANZ Bank (ANZ) to provide the Commissioner with information about Vanuatu account holders.

The court held that s 264(1)(a) abrogates any right not to be compelled to contravene the law, including a foreign law. There was no “fundamental right” of a recipient of a notice not to be compelled to contravene a foreign law that purported to have extraterritorial operation.

The court held that there was no requirement that the notices must be limited (expressly or otherwise) to information directly relating to the assessable income of Australian taxpayers. That would have effectively precluded an exercise of the investigatory power for the purpose of ascertaining whether persons may have assessable income. The Commissioner could “fish” in a “pool” that contained (or might contain) persons who are subject to an Australian tax liability — that was sufficient to attract the purpose necessary to exercise the power.

The court also held that a s264 notice must have sufficient certainty, and then declared that a second notice was unenforceable for uncertainty because it required ANZ to provide in the case of non-natural persons “any identifiers of the officers of the customer including name, date of birth, gender, telephone number, address, address for correspondence”.

The court held that the use of the word “officers” gave rise to uncertainty as it required ANZ to examine the definitions of “officer”, “director” or “agent” by reference to applicable Vanuatu legislation. Had the notice defined “officer” as being any person designated in the GIW as a director, secretary and/or servant of the customer, there may well have been sufficient certainty and no difficulty.

The court held that the second notice was also uncertain because it did not sufficiently delineate, by criteria provided in the notice and by reference to information known by ANZ, the information that ANZ was to produce.

The court held that ANZ should not be put to the task of disentangling the valid and invalid components of the second notice and so the second notice was invalid in its entirety.

Australia and New Zealand Banking Group Limited v Konza 2012 ATC ¶20-347

For professional advice on all matters concerning taxation issues, contact the team at Irish Bentley Lawyers.

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