French Supreme Court Decision in UBS Group Case

UBS Group has been spared from paying approximately $2 billion after the French Supreme Court partially overturned a previous ruling that had fined the bank in a lengthy tax-fraud case. However, the court upheld the decision that UBS had indeed assisted wealthy clients in France in evading taxes.

In an announcement made on Wednesday, the Supreme Court effectively lifted the financial penalties that had been imposed on UBS in December 2021. During that time, the Court of Appeal had fined the bank €3.75 million ($4.1 million), ordered the confiscation of €1 billion, and granted civil damages amounting to €800 million to the French state. UBS had appealed this ruling.

It should be noted that Wednesday's verdict cannot be appealed further, as it originates from the highest court in France. Nevertheless, the Supreme Court stated in its ruling that it would refer the case back to the Paris Court of Appeal to reassess potential penalties for the aspects of the case that were overturned.

UBS firmly asserts that it has always operated in compliance with all relevant laws and regulations. The bank maintains its stance and will vigorously defend itself during the upcoming trial.

UBS Faces Legal Setback in France

The highest court in France has affirmed a previous court decision against UBS regarding unlawful client solicitation and aggravated laundering of the proceeds of tax fraud. While UBS is pleased that certain important aspects of the legal case align with their position, they express disappointment with the verdict due to the existence of a treaty between Europe and Switzerland on the taxation of savings income, as well as the lack of specific evidence supporting the alleged facts.

UBS disclosed in its latest financial report that it has provisions of EUR1.1 billion related to the tax case on its balance sheet as of the end of September. This amount reflects the bank's best forecasts of potential financial implications from the case.

Despite this setback, UBS shares traded 2.3% higher at CHF22.61 as of 1602 GMT.