The Ministry of Finance has defended its position on the requirement to sign 12 Tax Information Exchange Agreements (TIEAs), saying that it is on course to meet the deadline of September.

It follows Shadow Finance Minister Bob Richards' comments in yesterday's paper, questioning exactly what and when Government knew about the need to sign the TIEAs, asking how long the Ministry of Finance had known about the deadline for the TIEAs to be signed and how Crown dependencies, such as the Isle of Man, Jersey and Guernsey, had managed to get their act together.

Bermuda was included on the Organisation for Economic Co-operation and Development's (OECD) "grey list" of jurisdictions which have not been considered to meet international tax transparency standards they have already committed to.

Earlier this month, UK Prime Minister Gordon Brown sent out a letter to all British territories considered financial centres, which urged them to sign 12 TIEAs by September or face the possibility of sanctions.

But, the Ministry of Finance said the 12 TIEA standard was set in late 2008 for consideration for the full OECD Global Forum that was expected to meet in late 2009, adding that Bermuda was well-positioned to meet this recommendation if adopted by the Forum, as well as meeting the last-minute deadline set by the Group of 20 countries (G20) or by Mr. Brown.

The Ministry said that Mr. Richards should have been aware that the publically available G20 Communiqué dated April 2, 2009, stating that a review of its communiqué would occur at its Finance Minister's meeting in November 2009 in Scotland.

It claimed that the first knowledge the Ministry had of the UK's imposed earlier deadline of September 2009 was when it received Mr. Brown's letter.

Finance Minister Paula Cox said Bermuda had signed 11 TIEAs and was poised to sign a further three with Germany, the Netherlands and Mexico soon, while confirming that meetings had been held with representatives of another OECD member and formal talks had started with Canada in line with the Finance Ministry's business plan objectives for 2009/10.

"There are very few countries who have such a track record of continuous and diligent efforts made to conclude and now sign TIEAs with a wide range of countries," she said.

"Although some may only reflect on the numbers that seem to match Bermuda's the fact remains that Bermuda has in fact engaged with many more countries from various regions."

The Ministry of Finance pointed out that there was no The Ministry of Finance pointed out that there was no OECD/G20 criteria of 12 TIEAs until a few months ago and was an arbitrary number given as a recommendation of a sub-committee of the OECD Global Forum, which was yet to be ratified by all participating members.

"Under pressure from the G20, the OECD prepared a status report based on 12 TIEAs but this criteria was taken up by the G20 as the basis for black and grey-listing for meeting other political purposes, and as the case turned out, carelessly separating the wheat from the chaff," it said in a statement.

"In many respects the process was hijacked. The fact that a superpower or foreign government or regulator moves arbitrarily to make decisions that counter our efforts does not diminish the effort that was made.

"While any stakeholder who lobbies EU, OECD, or US Congress whether Government of Bermuda or industry associations or any one else the fact that the superpower or foreign government or regulator opts to make a decision that is counter to our national interests does not invalidate quality of representation made by the Government of Bermuda or our industry associations.

"The actions taken that have affected Bermuda are contrary to the principle of the level playing field but there is no question that Bermuda has been forthright with its efforts to conclude TIEAs in a timely fashion based on measured and quality representation."

The Ministry of Finance cited Jeffrey Owens, director of the Centre for Tax Policy Administration at the OECD, who favourably mentioned Bermuda as one of the jurisdictions which upheld its obligations under TIEAs, adding, at that time, only seven centres, one of which was Bermuda, were fully compliant with OECD transparency standards.

"Rather than rashly sign treaties with no intention of being willing or capable to respond to any requests for information made under these treaties, Bermuda has over 20 years experience exchanging information under its treaty with the United States, and has put this experience in a working relationship to good stead with the TIEAs we have in effect with other countries such as Australia and United Kingdom," it said.

"There is no doubt by our treaty partners that we are committed to tax information exchange and are not just signing papers that are worthless in practice but valuable politically."