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The role of judicial cooperation in the fight against tax evasion and tax avoidance in the CEMAC zonepar Frank Patrick MEUTCHEDJI FONGANG Institut des Relations Internationales du Cameroun (IRIC) - Master II 2018 |
C-Tax AvoidanceTax avoidance is the legal means used by a taxpayer to pay less tax by using the loopholes of the tax system.32(*) In other words, it is the legal usage of the tax regime in a single territory to one's own advantage to reduce the amount of tax that is payable by means that are within the law. It is therefore technically defined as all the legal actions of the taxpayer aimed at reducing the amount of the levies which he must normally pay.33(*) The OECD describes tax avoidance as arrangement of a taxpayer's affairs that are intended to reduce his tax liability and that although the arrangement could be strictly legal it is usually in contradiction with the intent of the law it purports to follow.It involves operating within the letter, but not the spirit, of the tax law. Tax evasion is as old as tax, and as earlier mentioned, it has been facilitated by globalization, the increasing complexity of international finance, bank secrecy and digital advances affecting all the regions of the world without leaving out the CEMAC zone. D-The CEMAC ZoneHaving replaced the Customs and Economic Union of Central Africa (UDEAC), CEMAC is a sub-regional entity made up of six (6) countries: Cameroon, Central African Republic, Congo-Brazzaville, Chad, Gabon, and Equatorial Guinea.In reality, the constitution of this sub-regional grouping has its roots from the colonial period, a period during which the Central African Republic, Congo, Gabon and Chad constituted an integrated geo-economic entity, under the appellation of «Afrique Equatorial Française»34(*) (AEF), created in 1910. On 29th June 1959, these countries created the l'Union Douanière Équatoriale35(*) (UDE).Having become autonomous and then independent by 1960, they opted for the consolidation of the links tied under the colonial regime and for the strengthening of their customs union.36(*) In 1962, Cameroon joined the UDE. In confirmation of this regrouping process, on the 8th of December 1964, the Heads of State of these five countries signed in Brazzaville the Treaty establishing UDEAC. This Treaty entered into force on 1st January 1966.37(*) Following a disagreement concerning the distribution of the Union's receipts, in 1968, Chad withdrew from it, before reintegrating in 1984, the year in which Equatorial Guinea joined the union. After a mixed assessment of UDEAC, and according to the guideline of the Lagos Action Plan of 1988 reaffirmed in 1991, a new treaty was signed on the 16th of March 1994 in N'djamena establishing CEMAC. It entered into force in June 1999 (Conference of Heads of State of CEMAC in Malabo).38(*) Taking over from UDEAC and being made up of two Unions that is, the Economic Union of Central Africa (UEAC) and the Monetary Union of Central Africa (UMAC), CEMAC's main missions and objectives are: the establishment of close ties between the peoples of the Member States so as to strengthen their geographical and human solidarity, the promotion of national markets by eliminating barriers to inter-community trade, the coordination of development programs, the harmonization of industrial projects, the development of solidarity among member countries for the benefit of disadvantaged countries and regions and the creation of a real African common market.39(*) From the above definition of key terms, it transpires that tax evasion and tax avoidance are important causes of illicit financial flow within the sub region thereby preventing member state from resources, which could have been used for their development as well as the realisation of the objectives and missions of CEMAC zone. The definition of the key terms being done, it will be necessary at this point to outline the interest of our work. The interest of our study is both practical (B) and Academic (A) Our study on the academic domain will help to enlighten researchers and students interested in carrying on studies on judicial cooperation generally and specifically the contribution of such a cooperation to the fight against tax evasion and tax avoidance. This will help to throw more light on the effectiveness of the cooperation in the CEMAC zone before bringing out its limitations as well as possible recommendations that could be brought forth in order to address such limitations. Our work will therefore contribute to enrich doctrine in the aforementioned domain notwithstanding the fact that it has to be blended with practice for a better understanding.This didactic approach fits perfectly with the thought of Immanuel KANT according to which "Experience without theory is blind, but theory without experience is mere intellectual play".40(*) Kwame NKRUMAH followed this line of though in his political Consciencism (1964) by holding that «theory without practice is empty, practice without theory is blind.» This study will enable the leaders and administrations of the CEMAC sub-region to be aware of the limited role of judicial cooperation plays within the framework of the fight against tax evasion and tax avoidance. Through the recommendations and suggestions made therein, they will be able to improve and update the various texts governing the said cooperation as well as create if need be institutions in charge of supplementing judicial authorities within the framework of the fight against tax evasion and tax avoidance. The above interest could be outlined thanks to the literature review. Literature review can be defined as a synthesis of the research and readings that help to highlight the relevant elements of a hypothesis in the writings of one or more authors. It is use to support a theory. Therefore, we shall retain the ideas reflecting the progress of research on our theme, for a more in-depth study. Professors Guy Isaac and Marc Blanquet in their book titled Droit général de l'Union Européenne, are of the opinion that, judicial cooperation within the European Union is principally based on dialogue between the community jurisdiction (European court of justice) and the jurisdictions of member states. That is why, «preliminary ruling provided for by Section 267 of the Treaty on the Functioning of the European Union (TFEU) is the first and principal mechanism of judicial cooperation in the Union».41(*) These authors further present judicial aid between national jurisdictions as the second mode of judicial cooperation within the European Union.42(*) However, it is worthwhile noticing that, these authors present the various modes of cooperation within the union without really making an appraisal. Furthermore, Juliette HUVET, Joelle PAMART, Tania RACHO and Hélène VERBRUGGHE in their work on EUROJUST titled « La pertinence de la coopération judiciaire au sein de l'Union européenne » are of the opinion that, Judicial cooperation under EUROJUST ranges from its metamorphosis, through its relationship with other crime-fighting bodies, to the expectations since the Lisbon Treaty43(*). However, all four authors seem to limit the notion of judicial cooperation to mutual legal assistance between courts within the European Union leaving out other aspects such as extradition, investigation of corruption, economic and financial crime as well as money laundering etc.They further argue that judicial cooperation is limited to criminal matters. This is an erroneous conception of judicial cooperation reason being that it extends to other domains such as civil, commercial, administrative and tax etc. This is evidenced by the various international agreements and treaties signed both at the bilateral and multilateral levels governing judicial cooperation in the above-mentioned domains. Théophile NGAPA in his Masters' thesis titled La coopération judiciaire pénale dans la zone CEMAC brings out the political and judicial scope of judicial cooperation. For the author, judicial cooperation in the CEMAC zone is a problem of norms and practice. However, he limited his analysis of judicial cooperation only to criminal matters leaving out the other aspects of the cooperation. Furthermore, Martial Fabrice ETEME ONGONO, in his master thesis titledLa coopération judiciaire pénale dans les communautés économiques régionales en Afrique : cas de la CEEAC et de la CEDEAO extends the analysis of judicial cooperation at the African level notably within regional economic communities such as ECCAS and ECOWAS. But contrary to Théopile Ngapa he looks at judicial cooperation within the above mentioned regional economic communities from the judicial and institutional aspects, then proceeds to examine their similarities and differences. However, he does not propose solutions to the negative aspect that impedes judicial cooperation within ECCAS and ECOWAS. According to Pierre BELTRAME, a tax is a "pecuniary benefit, required from natural or corporate persons, according to their contributory faculties, by way authority on a definitive basis without any specific consideration, with the view of covering public charges or for the purposes of intervention by the public authorities»44(*) . This definition implies that taxes and other levies have as their main purpose the development of the countries in which they are levied and consequently the regional and sub-regional communities as well as international organisations to which these countries belong. To this end, the OECD has duel a lot on the need to protect these taxes through the fight against tax evasion and tax avoidance. The OECD constitutes a pool of statistical information of primary importance. This organization drafts reports and formulates recommendations on tax matters, which are sometimes used as models for administrative assistance. These information exchange agreements are generally based on the OECD Model Tax Convention on Income and Capital (OECD-MTC). It has also be very instrumental in the fight against illegal tax heaven thus, its expertise is evident in the field of assistance. The OECD, through its Committee on Fiscal Affairs, is a veritable laboratory in the fight against international tax delinquency.Edoardo TRAVERSA and Matthieu POSSOZ have further highlighted the work of the OECD in publication titled «l'action de l'OCDE en matière de lutte contre l'évasion fiscale internationale et d'échange de renseignements: développements récents.»45(*)These authors throw more light on the specific role of the OECD in fighting against international tax avoidance through exchange of information using its projects such as the Base Erosion and Profit Shifting projects (BEPS) and other project which complete its actions in fighting against tax avoidance such as the standard for automatic exchange of information relating to financial accounts. However, the loadable works of the OECD and that of the authors mentioned supra does take into consideration the judicial aspects of the fight against tax evasion and tax avoidance. Bernard Castagnède in his book titled Précis de fiscalité international presents the various ways by which tax administrations can cooperate in other to recover due taxes. This cooperation can be bilateral or multilateral and it is conditioned by the presence of a tax treaty between the respective parties. Furthermore, the author also highlights some measures that could be used to fight against international tax evasion and avoidance. In so doing, the author divides them into general measures and specific measures.46(*) Alexandre MAITROT DE LA MOTTE in his book Droit Fiscal also highlights the pertinence of tax treaties in the fighting against tax evasion and tax avoidance through the mechanism of exchange of information and assistance in the recovery of taxes.47(*) The above mentioned authors seems to limit their analysis of the fight against tax evasion and tax avoidance to the administrative dimension of the cooperation leaving out the judicial aspect. Félix ATECK A DJAM in his book Droit du Contentieux Fiscal Camerounais talks about the criminal repression of tax evasion. In doing that, the author brings out the material and intentional elements of the tax evasion before delving into the procedure of the fight against the said evasion48(*). The author has not analysed tax avoidance when we know how related it is to tax avoidance. He has further not looked at how Cameroonian jurisdictions can cooperate with jurisdictions of CEMAC member's states to fight against tax evasion when we know that Cameroon economy alone constitutes more than 40% of CEMAC's GDP. Most research works on the fight against tax evasion and tax avoidance are essentially based on administrative cooperation, which principally entails the exchange of information from one tax administration to the other. Furthermore, judicial cooperation on its part is more active in criminal matters notably via the mechanisms of rogatory commissions and extradition. The important weight of sovereignty claims, systemic corruption, banking secrecy, the timid harmonisation of sanctions among CEMAC member States as well as the rule of conditional extradition in tax matters are amongst other things factors limiting the role of judicial cooperation in preventing tax evasion and tax avoidance. This research work is therefore motivated by the necessity to throw more light on the contribution that judicial cooperation within the framework of the fight against tax evasion and avoidance could bring if it was enhanced. The problem statement can be defined as the theoretical approach or perspective that one decides to adopt in other to deal with the problem posed by the initial or central question. It is a way of questioning the phenomena studied. It constitutes a pivotal stage of the research49(*)or all what is built around central question and the research hypothesis. All this making it possible to treat the chosen topic. The difficulties inherent in the fight against tax evasion, tax avoidance as well as illicit financial flow in the CEMAC sub-region warranted member States to join their efforts in other to curtail the effects of the above mentioned challenges on their economies. In so doing, judicial cooperation come up amongst other forms of cooperation used by States. This studies therefore aims at assessing the role and effectiveness of the said cooperation within a context were the fight against tax evasion and avoidance is more tilted towards administrative rather than judicial cooperation. Coupled with the fact, the literature on the judicial cooperation within the fight against tax evasion and avoidance is practically absent. The above developments therefore give rise to the following central question: Whatrole does judicial cooperation plays in the fight against tax evasion and tax avoidance in the CEMAC zone? To the above mentioned principal question, we can add secondary questions such as: - What are the factors limiting the role of judicial cooperation in preventing tax evasion and tax avoidance in the CEMAC sub region? - How can judicial cooperation within the framework of the fight against tax evasion and tax avoidance in the CEMAC zone be enhanced? Hypothesis generally designates a provisional answer to a question that has been asked, provisional because it needs to be confirmed or infirmed from research and subsequent developments.50(*) In other words, the hypothesis is a temporal answer to the central question. After an intensive reading on the topic, it comes out that there is little or no research on judicial cooperation in fight against tax evasion and tax avoidance in the African continent as a whole and more specifically in the CEMAC sub region, most of the writings and research being centered on judicial cooperation in criminal matters. Furthermore, it is worthwhile noticing that in practice, the fight against international tax evasion and tax avoidance is oriented towards administrative rather than judicial cooperation. This leads us to the following central hypothesis: - Judicial cooperation within the framework of the fight against tax evasion and tax avoidance in the CEMAC zone supplements administrative cooperation. The aforementioned principal hypothesis, gives rise to the following first secondary hypothesis: - The current form of judicial cooperation in the CEMAC zone does not permits an effective fight against tax evasion and tax avoidance. This is principally due to institutional and structural deficiencies. This leads us to the following second secondary hypothesis: - The adoption of a new approach on judicial cooperation will help to enhance its role in the fight against tax evasion and avoidance. These hypotheses will be demonstrated by a defined methodological approach. VII- The theoretical and methodological framework of the study The hypothesis above will be verified using specific methods (B) and theory (A). The term theory comes from the Greek «theorein» which means to observe with wonder what happens in other to describe, identify and to understand it. Theory makes it possible to account for social facts from a predefined model.51(*) For Marcel Merle, theory is a means of better apprehending reality.52(*) Thus, it is theory that gives an explanation or an understanding to a phenomenon. Within the framework of our study, our choice will be focus on analysing liberalism and neoliberalism which is a revised version of the latter. Liberals believe that international institutions play a key role in cooperation among states. With the correct international institutions, and increasing interdependence (including economic and cultural exchanges) States have the opportunity to reduce conflict.States interact in various ways, through economic, financial, judicial and cultural means; security tends to not be the primary goal in State-to-State interactions; and military forces are not typically used.53(*) Liberals also argue that international diplomacy can be a very effective way to get States to interact with each other honestly and support nonviolent solutions to problems.With the proper institutions and diplomacy, Liberals believe that States can work together to maximize prosperity and minimize conflict.54(*) Liberalism as an international relation theory will help us to understand the how CEMAC member states can cooperate (on the judicial and administrative domains) in other to fight against tax evasion and tax avoidance in the sub region. Neoliberalism share many assumptions as neorealism (namely, that the international system is anarchic, States are the main actors, and states rationally pursue their self-interest), but draws different conclusions from those assumptions. In contrast to neorealist scholarship which is skeptical of prospects for sustainable cooperation, neoliberalism argues that cooperation is feasible and sustainable. Neoliberals highlight the role of international institutions and regimes in facilitating cooperation between States. The main reason why international organizations facilitate cooperation is that they provide information, which reduces collective action problems among States in providing public goods and enforcing compliance.55(*) Robert Keohane (1984) book After Hegemony used insights from the new institutional economics to argue that the international system could remain stable in the absence of a hegemon, thus rebutting hegemonic stability theory. Keohane showed that international cooperation could be sustained through repeated interactions, transparency, and monitoring.56(*) B- The methodological framework Method is defined by Professor Madeleine Grawitz, as all intellectual operations by which a discipline seeks to reach the pursued and demonstrated truth.57(*)The method can further be defined as an approach consisting in following with application a path which leads to a fixed goal while respecting the intermediate stages.58(*) Using method is good, but using the correct one is better. Below are few selected method to be used in our study. Ø The hypothetic and deductive method The hypothetic and deductive method is a scientific method that consists of formulating a hypothesis in order to deduce and observable future consequences (prediction) as well as past ones, making it possible to determine its validity. In other words, it entails the formulation of a hypothesis, data collecting and testing of results obtained to refute or support the hypotheses. Within the framework of this method, a principal hypothesis alongside secondary ones shall be formulated and their validity tested in the course of our progress in this research work. Ø The legal method The legal method consist in searching for legal texts and confronting them with facts and law. It further entails a study and exposure of legal texts as well as different documents relating to the subject matter while looking for the applicable law.59(*) Within the framework of our study, this method will help us to analyse the various legal texts governing judicial cooperation in general and the fight against tax evasion and tax avoidance in particular. Here, we are referring to are both national and international legal instruments of which the interpretation will be of great help during this study. Ø The analytical method This method beyond the analysis of legal texts relating to judicial cooperation relating to the fight against tax fraud and evasion in the CEMAC sub-region, will enable us to identify the different challenges facing the above mentioned cooperation and eventually propose solutions aimed at solving the said challenges. Ø The comparative approach This approach takes into account the comparative law notably, the legislations of some communities spaces such as ECOWAS and the European Union as well as some bilateral tax conventions which could serve as model to improve community mechanisms in fighting against tax evasion and tax avoidance. Ø The technic of date collection The technique used at this juncture shall be documentary. Meaning that, we shall proceed to scrupulously exploit the books, notes, scientific articles and other digital files relating to our topic. After the methods, we will continue with the announcement of the plan. Based on the above developments, the first part of our work shall be devoted to the analysis of the role of judicial cooperation within the framework of the fight against tax evasion and tax avoidance in the CEMAC zone. The objective here shall be to present the generalities of tax evasion and tax avoidance and the various mode of cooperation devised by CEMAC member States to solve the problem of tax evasion and tax avoidance (Part I). The second part shall be based on the problems inherent in preventing tax evasion and tax avoidance in the CEMAC zone and the necessity of adopting a new approach to enhance judicial cooperation. The aim here being the adoption of mechanisms that could help in revitalising sub regional judicial cooperation instruments within the framework of the fight against tax evasion and tax avoidance (Part II). * 32 Évasion, fraude, optimisation fiscale : quelles différences ? » [ archive], sur financespubliques.fr, Ministère de l'Économie et des Finances (consulté le 22 décembre 2019) * 33Antoine Malgoyre, Montages juridiques et habileté fiscale, Issy-les-Moulineaux, Lextenso, 2017, 240 p. ( ISBN 978-2-297-06043-1, lire en ligne [ archive]), p. 17 * 34Federation of Equatorial French Africa * 35 Equatorial Customs Union * 36 Ange BANGO, l'élaboration et la mise en oeuvre de la fiscalité dans les pays de la CEMAC, Thèse : Doctorat en Droit,Université Jean Moulin Lyon 3, 2003, page 4. * 37 Ibid. * 38 Ibid. * 39 Ibid. * 40This is declared to be
"an old Kantian maxim" in General Systems Vol. 7-8 (1962)ý, p. 11, by
the Society for the Advancement of General Systems Theory, but may simply be a
paraphrase or summation of Kantian ideas * 41 Guy ISAAC et Marc BLANQUET, Droit général de l'Union européenne, 10e éd., Sirey, 2012, p. 635. * 42 Ibid. * 43 http://www.lepetitjuriste.fr/wp-content/uploads/2011/06/Memoire_Eurojust2.pdf accessed on 23/06/2022. * 44Pierre BELTRAME et MEHL, Techniques, politique et institutions fiscales comparées, Thémis, PUF, 1997, P.36 * 45TRAVERSA, EDOARDO et POSSOZ, Matthieu. L'action de l'OCDE en matière de lutte contre l'évasion fiscale internationale et d'échange de renseignements: développements récents. Revue Générale Du Contentieux Fiscal, 2015, p. 5-24. * 46 Bernard CASTAGNEDE, Précis de fiscalité international, 4éd, PUF, Paris, 2002, p. 282 & 431. * 47 Alexandre MAITROT DE LA MOTTE, Droit Fiscal, PUF, Paris, 2011, p. 101. * 48 Felix ATECK ADJEM, Droit du Contentieux Fiscal Camerounais, 2éd, Harmattan, Paris, 2017, p.367 & 368. * 49 QUIVY Raymond et VAN CAMPENHOUDT Luc, Manuel de recherche en sciences sociales, 2e éd., Dunod, Paris, 1995, p. 85 cited by Martial Fabrice ETEME ONGONO, La coopération judiciaire pénale dans les communautés économiques régionales en Afrique : cas de la CEEAC et de la CEDEAO, Mémoire : master en droit publique international et communautaire, université de Yaoundé II, 2013. * 50 Madeleine GRAWITZ, Méthodes des sciences sociales, 8e éd., Dalloz, Paris, 1990, p. 34. * 51 Dario Batistella, Théories des relations internationales, Paris, Presses des sciences politiques, 2e édition, 2002, p.226. cited by Jean Cottin Gelin KOUMA, Le facteur culturel dans la coopération sino-camerounaise:le cas de l'implantation de l'institut Confucius a l'institut des relations internationales du Cameroun(IRIC), Mémoire : master II en relation international option diplomatie, Universite de Yaounde II-Soa , 2010. * 52Marcel Merle, Sociologie des relations internationales, Paris, Dalloz, 1974, p.3. * 53Shiraev, Eric B, International Relations. New York: Oxford University Presses, 2014, p. 78. * 54 Ibid. * 55Keohane Robert, After Hegemony: Cooperation and Discord in the World Political Economy, Princeton University Press, 1984. * 56 Ibid. * 57Madeleine GRAWITZ, op.cit. * 58Jacqueline FREYSSINET-DOMINJON,Méthodes de recherche en sciences sociales, Montchrestien, Paris, 1997 p.11. * 59 Madeleine GRAWITZ, op.cit. |
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