Spain and Andorra have agreed to strengthen cooperation in the exchange of information and fiscal transparency.
The Memorandum of Understanding, General Friendship and Cooperation, was signed as a framework agreement encompassing areas such as foreign policy and European, Latin American, and consular affairs, education, culture, health, and the economy.
The Memorandum reflects the strong ties between the two countries, showing that about one third of the population of Andorra is Spanish and Spanish exports represent 62% of the Andorran foreign trade. The Agreement is a categorical breakthrough in Andorra’s process of fiscal approval with neighboring countries.
It is an Agreement that aims to avoid double taxation with respect to taxes on income and to prevent tax evasion between the two countries, as well as facilitate bilateral trade relations to prevent companies and individuals from being taxed for the same thing in Spain and Andorra. In summary, it aims to promote investments, reduce taxes, and increase legal certainty.
Spain may request information from Andorra about a group of residents in Spain that hold the same financial product in any Andorran bank without making a declaration before the Treasury Department.
The Treasury Department also intends to strengthen the signing of these types of agreements and extend the network of information exchange treaties. Some of the agreements initialed during this term include Bahrain, Austria, United Kingdom, India, Uzbekistan, Cyprus, Argentina, and the United States.
Also authorized were the signing of information exchange agreements with the dependencies of the British Crown of Jersey, Guernsey, and the Isle of Man. Furthermore, as pointed out by the Treasury Department, Spain leads a pilot project to develop a comprehensive and standardized information exchange system, based on the FATCA model agreement with the United States, alongside France, Italy, Germany, and the United Kingdom (G-5).
The implementation of a process to negotiate an association agreement between Andorra and the European Union “will contribute to the strengthening” of their relationship and their effective participation within internal markets.