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96 • Fifty Shades of Tax Dodging<br />
Special Purpose Entities (SPEs)<br />
According to the Ministry of Finance, Sweden does not allow<br />
for the establishment of Special Purpose Entities (SPE), as<br />
there are no legitimate entities designed to keep foreign<br />
investments separate from domestic economic activities. 1098<br />
Patent box<br />
Sweden does not currently have a patent box and has no<br />
plans to introduce one. 1099<br />
Tax treaties<br />
In 2015, Sweden only signed one new treaty with the UK,<br />
but this is not yet in force. 1100 The MoF has not given out<br />
any information about planned negotiations for other new<br />
treaties, as it is not part of Swedish policy to do so. 1101<br />
According to the MoF, there are large differentiations within<br />
and between the existing treaties. Officials did not reveal any<br />
information regarding whether the treaties primarily follow<br />
the UN model in allocating tax rights or the OECD model,<br />
instead noting that “tax treaties are a result of bilateral<br />
negotiations.” 1102 All tax treaties are subject to ratification by<br />
the Swedish Parliament, which ensures their involvement,<br />
according to the Ministry. 1103<br />
Swedish negotiations of bilateral treaties include lowering<br />
charged tax payments for transfers between countries,<br />
allowing a grey zone where money could be moved in and out<br />
of Sweden easily without incurring the normal tax levels. 1104<br />
Financial and corporate transparency<br />
Sweden has signed information exchange agreements with<br />
several low-tax jurisdictions in the past year, including<br />
Panama, Bahrain, Belize, Hong Kong, Macau and Grenada. 1105<br />
At the beginning of 2015, an agreement for information<br />
exchange on request with Liberia also entered into force. 1106<br />
However, there is no further information available regarding<br />
whether Sweden would be willing to automatically exchange<br />
information with developing countries.<br />
Public reporting for multinational corporations<br />
The MoF has reported that it intends to follow the<br />
recommendations by the OECD BEPS project on country by<br />
country reporting. This means that the reporting will not be<br />
made public and only very large multinational companies<br />
with an annual turnover of more than €750 million will be<br />
required to comply with this type of reporting. 1107<br />
By indicating a preference for confidential reporting,<br />
Sweden is missing a major opportunity to promote<br />
corporate transparency. Furthermore, should Sweden<br />
choose to implement country by country reporting with<br />
the OECD’s threshold of €750 million, only a fraction of<br />
relevant multinational companies will be captured. The<br />
OECD threshold will only cover 56 of the listed multinational<br />
companies headquartered in Sweden, while the threshold<br />
currently proposed by the European Parliament would cover<br />
224 companies. 1108<br />
Nonetheless, Sweden does have a legal requirement on<br />
reporting of transfer pricing and carry forwards of losses. 1109<br />
The Swedish Tax Authority is responsible for handing<br />
in additional reporting on company structures, but the<br />
information is not accessible to the public. Sweden has fully<br />
adopted the EU requirements for public country by country<br />
reporting for banks and investment firms. 1110<br />
Ownership transparency<br />
A money laundering scandal at Swedish banks indicates<br />
the need for strong anti-money laundering (AML) rules in<br />
Sweden. The Swedish financial watchdog has fined two of<br />
the larger banking groups, Nordea and Handelsbanken, to<br />
the tune of millions of euros because of major deficiencies in<br />
their approach and work regarding money laundering. The<br />
lack of an effective system of preventing money laundering<br />
or activities linked to terrorism by the Swedish banks was<br />
not only heavily portrayed in media, with a negative effect on<br />
the stock market, but also forced the banks to increase their<br />
resources to comply with the regulations. 1111<br />
The new Swedish government would like to see a swift<br />
adoption of the Anti-Money Laundering Directive (AMLD)<br />
and therefore appointed a public inquiry in December 2014.<br />
The inquiry was supposed to present proposals on how to<br />
implement the AMLD in Swedish legislation, but it has been<br />
postponed until 15 December 2015. 1112 The proposals of the<br />
inquiry will be followed by a consultation and then by the<br />
work of producing the legislative proposals at the MoF. Given<br />
the legislative process, there are no firm timelines that<br />
may be conveyed at this point, but the government aims to<br />
present the proposal to Parliament as soon as possible. 1113<br />
As the AMLD requires a central register of beneficial owners,<br />
an investigation appointed by the government will include an<br />
analysis regarding how the AMLD should be implemented in<br />
Swedish law. 1114 Sweden is undecided about whether to allow<br />
wider access to the registers of beneficial owners than those<br />
stated in the AMLD. The inquiry is targeting issues related,<br />
for example, to the implementation of a central register. At<br />
this time, the government is unable to provide any answers<br />
on the details. 1115