The decision identifies only one of the four categories - Category 2. "Category 2 includes accounts held by a domiciliary company with a U.S. beneficial owner with U.S. securities and with which Form W-9 is not associated." The Court decided that the category did not fall under the "tax fraud or the like" required under treaty as the Swiss interpret the treaty. Rather, the category request as framed "includes persons, who at the utmost could be suspected of having committed tax evasion." Tax evasion is lesser conduct than tax fraud required by the Swiss interpretation of the treaty. The Court further concludes that
the “search criteria” are not sufficiently tailored to enable the bank to identify with a high degree of probability those clients who are suspected of fraudulent conduct triggering administrative assistance and to simply leave the task of examining whether the transmitted data are suitable to confirm the suspicion of fraudulent conduct to the SFTA. Such a procedure is inconsistent with the principle of proportionality, which – as a general principle of administrative law – also applies to proceedings regarding administrative assistance.
The Court reaffirms its case law that under the DTC USA-Switzerland 96 administrative assistance shall not be granted for presumed tax evasion, even if high amounts are at stake. It also confirms that the mere failure to declare a bank account may be qualified – at the utmost – as a tax evasion, which is not subject to administrative assistance.This result could be changed under the negotiated protocol now awaiting U.S. Senate approval. But see my prior blog Swiss Continue Their Behavioral Patterns - Black is not White (4/9/12), here.
Klaus Wille and Giles Broom, Swiss Court Rejects Disclosure of Credit Suisse Client Data (Bloomberg 4/11/12), here.