ABSTRACT
The Indonesian Minister of Finance signed the Multilateral Competent Authority Agreement (MCAA) on Automatic Exchange of Financial Account Information on 3 June 2015. The MCAA is a multilateral instrument that facilitates the implementation of the Automatic Exchange of Information (AEOI) of financial accounts globally using the Common Reporting Standard (CRS). The grounds for signing the MCAA were that thousands of trillions of rupiah belonging to Indonesian citizens had been indicated as being hidden in tax haven countries. Through the AEOI system, the treasures hidden in foreign countries can be tracked much more easily. However, Article 1 point 28 of Law Number 7 of 1992 concerning Banking as amended by Law Number 10 of 1998 (Republic of Indonesia, 1992, 1998) provides that details of a depositor’s financial circumstances shall be included in the scope of bank secrecy. Disclosing any information within the scope of bank secrecy is a criminal offence. To protect banks from any liability, the Financial Services Authority (FSA) stipulates that customers should provide written letters of attorney that authorise banks to provide details of their financial circumstances in the context of AEOI using CRS. This causes a legal dilemma: What is the legal impact of the signing of the MCAA from the perspective of banking law? This legal research employs a qualitative doctrinal legal method. The provision that requires bank customers to give their prior consent to the banks in providing such financial information, in normal circumstances, is contrary to the code of the Banking Act. According to the code of the Banking Act, the consent should be given on the basis of the free will of the depositors. It would be unlawful to require the depositors to give their consent under any duress. Moreover, the enforceability of the signed MCAA instrument is lower than that of the Banking Act. As a result, this may cause the signing of the MCAA and the issuance of the FSA Regulation to be null and void.
