Liu Poyung 15 march 2023

Disclaimer. this document does not express or reflect any opinion about the
issue.

DAC6 Directive and Lawyer’s Professional Secrecy, has general

interest of european citizen been sacrificed to please specific
professional sectorial economic interest ?

An Opinion about recent ECJ jurisprudence .

It was the first time that European Court of Justice judge on questions of
professional legal privilege related to the transposition of the DAC6
Directive in Belgium.
Usually private legal sector ( lawyer in general and attorneys in particular) is
opposed to the approach of the public authorities to make them public agents.
DAC6 required them to comply with reporting obligations on behalf of and in
the interest of the state and which could create a conflict of interest between
them and their clients.

We would like to make a brief « compare and contrast » approach on this

article. Indeed a comparaison can be made with the differents obligations to
fullfil V.A.T tax form for corporation, which also has an approach that make
them public agents in some respect.

Indeed, this configuration leads the corporation to file documentation about

their expenses for tax authority and therefore make them public agent in
collecting information and tax for V.A.T authority about their client in a
business to business point of view. Nobody has never protested against this
mechanism, and we never heard any actor from private legal sector complain
about fundamental privilege being waived when put in practice in a
democratic society, even more in public opinion point of view.

Therefore if in a democratic society, private legal sector and public opinion

largely agree that the mechanism of V.A.T information is legitimate and
follow a general interest purpose, there is no reason that for DAC 6 - that
follow an even more important general interest purpose - to exempt lawyers
from DAC 6 obligations ( that mean to exempt them from the obligation to
report a cross-border arrangement where such a reporting would be
contrary to the professional legal privilege applicable under the national law
of the Member State ). Indeed this argument put clearly specific interest of
private legal sector above the general interest of population of Member
State. By principle in a democratic society the general interest is above
specific interest (Alpha and Omega of all public law). Howewer ECJ
approach clearly contradict this principle. Exception exist when it is deemed
« necessary in a democratic society », but as previously compared with
V.A.T mechanism, this necessity doesn’t exist for general interest, but
indeed exist for specific sectorial interest (that mean private legal sector
prefer to protect one of their source of income even in contradiction of
general interest). If this specific interest is put above the general interest
then how can a country (Belgium) that pretend to defend rule of law in a
democratic society maintain his credibility from point of view of his own
public opinion and others europeans citizens ? If the credibility is not
maintain there will be more circumvent practice from their various actors,
and if there is more circumvention practice there will be even less public
fund for public service. Same line of arguments apply for all European
Union after this European Union Court of Justice Jurisprudence.

Therefore it seems difficult to be pretend to be surprised when the rise of

euroscepticism in European Union attain high level in public opinion.

On contrary, the General Advocate’s opinion was not followed by the Court
(ECJ), but seems a more fair approach, indeed he defended the idea that an
attorney who inform other intermediaries does not infringe the provisions of
Article 47 of the Charter of Fundamental Rights (fair trial) and “does not
infringe the right to respect for private life guaranteed by Article 7 of the
Charter of Fundamental Rights, provided that the name of that [attorney]
is not disclosed to the tax authorities in the context of the fulfilment of the
reporting obligation under Article 8ab…” of the Directive. Following our
comparaison, the same reason apply when practice V.A.T obligation, they
don’t infrige any of theses rights too.

Some counter-arguments says that the attorney works for clients to whom
the attorney owes a “duty to advise”, law that requires the attorney to
transmit information to the state (third party) to whom he is not bound by
any duty to advise, make them public agent. Looking after V.A.T
mechanism, the attorney already fullfill their V.A.T form and never has
anyone heard that their privilege have been endangered.

We also know that the objective of the DAC 6 is to create a dissuasive

mechanism, as the multiplication of reporting obligations and the resulting
conflicts of interest should lead stakeholders to renounce such schemes, this
renouncement will serve the general interest, without any additional cost
from public purse (indeed if there is no such scheme, state will need to make
less fiscal investigation and therefore will decrease his expense). Therefor
this permit to allocate this surplus of public fund for other public services
(e.g hospital and public health against futur international infectious
diseases seems to be in real need of this public fund).

All in All there is no real principle to sacrifice general interest to please a

specific sectorial interest, and indeed the specific sectorial interest has so
little to do to make a big impact in favor of general population that is seems
really unreasonable to maintain this privilege, especially after one big
economical crisis related to public health (Covid) and the second not yet
finished inflation crise related to Ukraine’s war.

Finally, to the question has general interest of european citizen been

sacrificed to please specific professional sectorial economic interest ? The
only reasonable answer in short term is « Yes, indeed».
P.S. : To the subdiary question how to fund hospital ? The answer will be
« There was, alas, no more money. »