Data transfer to US authorities: bank employees' right to receive copies of delivered documents

29. Oktober 2014 – In a data protection dispute, the Swiss Federal Supreme Court held that the claimant (a Swiss bank) in a second instance proceeding before the Zurich Court of Appeal (see news) was not given an adequate opportunity to be heard and thus the second instance decision violated principles of due process (see decision of the Swiss Federal Supreme Court, BGer 4A_215/2014). The Swiss Federal Supreme Court remanded the decision to the Zurich Court of Appeal.

The background of this decision is the tax dispute between the USA and multiple Swiss banks. Banks – which are authorised to cooperate with US authorities – may transfer requested data to US authorities, provided they comply with data protection and employment law provisions. The Zurich Court of Appeal held that the Swiss bank had a duty to provide the bank employee concerned with copies of the documents transferred to the United States.

The Swiss bank filed a complaint against this decision with the Swiss Federal Supreme Court. In the second instance procedure, after the employee concerned had filed an answer to the complaint, the Swiss bank requested to be given the opportunity to file an additional statement. However, without further explanations, the second instance court did not grant such opportunity and immediately rendered a decision. The Swiss Federal Supreme Court held that this violated principles of due process and remanded the decision to the Zurich Court of Appeal for reconsideration and granting the claimant a right to be heard.

Therefore, the Zurich Court of Appeal will now have to reconsider what the claimant had to say and render a new decision as to whether bank employees must be provided with copies of the transferred documents or not. It will be interesting to see if the additional arguments of the claimant will have an impact and might possibly change the prior decision of the Zurich Court of Appeal.