Global Forum Peer Review Process
Without provision of
a ‘smoking gun’ to trigger new investigations, there is no curbing of vast
illicit financial flows and little or no impact on global portfolio investment patterns. The peerreviews are therefore setting the bar way, way too low to serve any useful purpose.The OECD-standard is satisfied if
of foreign companies is recorded, but there isno requirement to record ultimate beneficial ownership for such companies.
No comprehensive statistics are provided
about the volumes or types of information beingexchanged. It is impossible to assess whether or not the whole exercise is anything more thanwindow-dressing.In contrast to World Bank, IMF or UN processes,
has no involvement in the Global
Forum peer review process, which looks to outsiders as an exercise of “chaps talking withchaps”.
The Global Forum promotes and carries out
peer reviews instead of expert reviews
. Theprocess is likely to be more effective if outside experts without conflicts of interest were involvedin all stages of reviews.The Global Forum allows its members to
charge money for information.
In some cases moneyis demanded in return for information exchange, and the GF-peer review does nothing to preventthis. This adds further to the costs of countries seeking to curtail tax evasion.Participation in the Global Forum brings
costs but unclear benefits
for developing countries.There is a risk of diversion of resources because as a member, a developing country will need toundergo peer review of OECD-standards. These standards only look at non-residents investing ina (developing) country, and whether this country can access information about foreign investorsto hand over to foreign tax authorities: how many Europeans or North Americans evade taxthrough bank accounts in developing countries? Therefore, a developing country undergoing peerreview poses a highly hypothetical scenario which is hardly of priority for strengthening its taxsystem or combating poverty.The Global Forum secretariat staff and the peer review process
depend on the OECD.
Theprocess is biased towards standards that align with the interests of OECD member states, someof which are secrecy jurisdictions or have dependencies that are secrecy jurisdictions.There is little or no information on
contained in the peer review reports is
and largely relates
to the OECD’s (flawed) information exchange standard. There is no systematic analysis of routine
reporting, public registries, etc. There are no comparative tables except for narrow standardsbased on a flawed assumption.