Accidental Americans Association Urges Luxembourg Administrative Tribunal to Halt FATCA Data Transfers

The Association of Accidental Americans (AAA) has urged the Luxembourg Administrative Tribunal to halt the transfer of personal data to the United States (US) under the Foreign Account Tax Compliance Act (FATCA).

On 2 April 2021, the AAA filed an appeal with the Luxembourg Administrative Tribunal against the Luxembourg tax authorities' refusal to halt transfers of personal data under FATCA. In a recent press release, the AAA stated that it considers such transfers to be illegal and asks the Administrative Tribunal to submit several preliminary questions to the Court of Justice of the European Union (CJEU) on the compliance of these personal data transfers with the General Data Protection Regulation (GDPR).

Under FATCA, a US legislation with extraterritorial effect, financial institutions worldwide are obliged to transmit financial account information relating to customers who have been identified as US Persons, including accidental Americans, i.e. persons whom US law deems to be American citizens but who have only a tenuous connection with that country. Most countries have signed intergovernmental agreements (IGAs) with the US implementing FATCA. In most cases, the national tax authorities act as an intermediary for relaying information from banks to the US Internal Revenue Service (IRS).

The AAA stated that it considers these massive and automatic data transfers to violate European and national laws on personal data protection and privacy, including the GDPR. The association maintained that this violation of fundamental rights is particularly damaging to accidental Americans, who did not choose to be US citizens.

"The basic problem is that EU Member States must breach their own laws in order to comply with US law", exolained AAA president Fabien Lehagre. "This is just one example of the adverse effects of the extraterritoriality of American law".

In addition, the AAA is awaiting a decision from the European Commission on whether it will haul France before the CJEU after the French Council of State refused to recognise the illegality of FATCA-mandated personal data transfers. The AAA has also filed a lawsuit in Belgium and Luxembourg in order to put a halt to the transfers. 

Fabien Lehagre founded the Paris-based AAA in 2017 to defend accidental Americans against the undesirable effects of FATCA. The association now has 1,200 members.