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MARCO WERMAN: I'm Marco Werman, and this is The World, a co-production of the BBC World Service, PRI, and WGBH Boston. Switzerland has agreed to relax its banking secrecy laws. The Swiss decision coincides with similar moves by Liechtenstein, Andorra, Austria, and Luxembourg. All were under pressure to disclose information to foreign tax authorities regarding clients suspected of tax evasion. But as The World's Gerry Hadden reports, the reforms these European countries have announced don't go as far as US officials would have liked.

GERRY HADDEN: It was an unexpected move. Today, Switzerland's President and Finance Minister Hans-Rudolph Merz announced that the country would loosen a key part of its cherished banking secrecy laws. He said, “We will no longer differentiate between tax evasion and tax fraud.” Tax fraud is when you deliberately misrepresent your income. Evasion is when you don't declare it. The difference is like the difference between lying outright and lying by omission. Switzerland's change of heart now opens the way for European and US tax authorities to chase what they say amounts to hundreds of billions of dollars in hidden taxable wealth. European officials expressed satisfaction on the news of the Swiss concession. Maria Assimakopoulou is a spokeswoman for the European Commission.

ASSIMAKOPOULOU: We hope that those kind of decisions, they will help and they go in the same direction that the Commission is trying for many years to achieve, which is a better tax governance.

HADDEN: Switzerland's decision to open its banks, and their lists of clients, to closer scrutiny came only after mounting international pressure. The OECD, a group of the world's richest countries, was threatening to add Switzerland to a banking black list. Earlier, the US had threatened officials from Swiss bank UBS with criminal charges for helping Americans hide money. It dropped the charges only after UBS paid a huge fine and handed over the names of 300 of its American clients. So far today, US officials haven't commented, and that may be because while they've scored a victory against tax evaders, they didn't get carte blanche access to Swiss banks. The US Justice Department is pressuring UBS for the names of 52,000 more Americans it believes hold accounts with the bank. But Swiss member of Parliament Ulrich Schleer says those names will never see the light of day.

SCHLEER: We do not have bank secrets to protect the banks. We have bank secrets to protect the clients of the bank.

HADDEN: Schleer says Switzerland will still demand that any foreign investigation be handled on a case by case basis. Schleer is with the Swiss People's Party, which holds the most seats in the Swiss Parliament. And Swiss public opinion is strongly behind him on this point. For The World, I'm Gerry Hadden.

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