GENEVA, (Reuters) – The World Trade Organization’s appellate body yesterday threw out a complaint from Panama about Argentina’s efforts to combat alleged tax evasion and avoidance.
The case brought by Panama, now under global scrutiny because of a huge leak of secretive offshore accounts data from Panama-based law firm Mossack Fonseca, was the first WTO row over steps taken against “harmful tax practices”.
Panama accused Argentina of discriminating against suppliers of financial services based in “countries not cooperating for tax purposes”, and it won a partial victory in a ruling last September.
WTO member countries are not allowed to discriminate between suppliers from different suppliers. But Panama said in 2012 that Argentina discriminated in eight ways against countries, including itself, that did not exchange information with Argentine authorities for the purposes of fiscal transparency.
Argentina countered that its measures were in line with recommendations by the OECD and the Financial Action Task Force, which combats money laundering and terrorist financing.
The appeal ruling found Argentina’s measures did not break WTO rules. But it did not go so far as to say Argentina was definitely within WTO rules, either. Instead, it decided there had been insufficient analysis of Panama’s original complaint, leaving the way open for similar disputes in future.
