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Summary

  1. MEPs questioned Nobel Prize-winning economist Joseph Stiglitz over the Panama Papers leaks
  2. Mr Stiglitz quit an advisory panel to Panama's government set up after the scandal
  3. He said he had not received guarantees the panel's final report would not be published
  4. The committee of MEPs is due to present its final report before June next year

Live Reporting

By Paul Seddon

All times stated are UK

Sitting ends

Panama Papers inquiry committee

European Parliament

Brussels

And with that, today's committee hearing with Joseph Stiglitz comes to an end. 

Stiglitz: 'Good idea' to link trade and tax transparency

Panama Papers inquiry committee

European Parliament

Brussels

French Socialist Emmanuel Maurel asks whether the EU could use trade agreements as a means to get countries to comply with more stringent transparency requirements. 

He suggests that the bloc could for example deny preferential trading terms to countries that refused to implement transparency rules on tax reporting or beneficial ownership. 

Prof Stiglitz replies that he thinks this "would be a good idea".

He says such an approach could "advance the principle of transparency enormously". 

Emmanuel Maurel
BBC

UKIP MEP questions 'total isolation' for tax havens

Panama Papers inquiry committee

European Parliament

Brussels

Raymond Finch
BBC

UKIP MEP Raymond Finch asks Joseph Stiglitz about his recommendation that non-cooperative tax havens could be cut off from the global financial system. 

He says he "seems to be implying a total isolation" for such countries - and asks whether this should be considered immoral if it has a detrimental economic effect there.   

In reply, Prof Stiglitz says that citizens in such countries need to pressure their own governments not to "get away with imposing costs on others".

He does not offer a specific reply to Mr Finch's request for him to comment on the relationship between Hillary Clinton and multinational corporations. 

MEP asks for 'essential criteria' for tax haven blacklist

Panama Papers inquiry committee

European Parliament

Brussels

Maite Pagazaurtundua Ruiz
BBC

Spanish Liberal MEP Maite Pagazaurtundua Ruiz gives her backing to the idea of a common EU-wide list of countries defined as tax havens. 

She asks Joseph Stiglitz what the "essential criteria" could be for including countries on the list. 

Prof Stiglitz replies that a 0% corporate tax rate "should be criticised" from a tax competition point of view.

He also says that tax agreements between governments and companies "should be publicised" so that the public can find out whether individual firms are getting "special deals". 

MEP questions sovereignty worries

Panama Papers inquiry committee

European Parliament

Brussels

Joseph Stiglitz
BBC

Polish centre-right MEP Dariusz Rosati asks what EU countries might do in order to "reduce the incentives" of tax havens. 

He also asks how the EU countries might push for global agreement in this area without running into the charge they are infringing other nations' sovereignty. 

Prof Stiglitz says that "responsible sovereignty" should preclude policies "which hurt other countries". 

He says that countries that refused to comply with global norms could have their right to have European and American banks as "interlocutors" cut off.

MEP asks for recommendation on tax avoidance 'enablers'

Panama Papers inquiry committee

European Parliament

Brussels

Jeppe Kofod
BBC

Danish social democrat Jeppe Kofod, who is one of the "co-rapporteurs" of the committee's report, asks Professor Stiglitz what sanctions could be put on the "enablers" of tax avoidance - such as banks and lawyers who construct complex tax structures. 

Prof Stiglitz replies that in his report he advocates "very strong sanctions" against both countries and firms that do not comply with increased transparency requirements. 

He says that for firms, this could include removing their business licence to operate.

Stiglitz: 'Zero tolerance' needed on tax secrecy

Panama Papers inquiry committee

European Parliament

Brussels

Joseph Stiglitz
BBC

Prof Stiglitz continues that tackling secretive tax structures will require a "comprehensive global approach", and a "zero tolerance" stance towards tax secrecy. 

However, he says that Europe on its own can still have a "very significant impact" and could "make a very big difference". 

He says that there has been "some response" from the US Treasury to the Panama disclosures, but that he is "not hopeful" this will continue under Donald Trump, whom he describes as a "tax evader" himself.  

He says that the one issue he would like to highlight is the issue of beneficial ownership - which allows individuals to create a "complex web" of shell companies to hide their involvement. 

He tells MEPs that he therefore advocates establishing "publicly searchable registries" of beneficial owners available to tax authorities and the media. 

Tax havens 'the darker side of globalisation'

Panama Papers inquiry committee

European Parliament

Brussels

Joseph Stiglitz kicks the sitting off with a short speech, in which he tells MEPs that secretive tax structures have a "pernicious effect on the global society".

He says that the Panama Papers leaks brought home how "secrecy havens" are used to conceal a "whole range of nefarious activities ". 

He adds that he originally agreed to join the Panamian government's panel to help show a "model of what could be done" in this area - particularly in the United States.  

Secretive tax havens are, he says, the "darker side of globalisation".

Joseph Stiglitz
BBC

Background on the Panama Papers committee

Panama Papers inquiry committee

European Parliament

Brussels

The 65-member committee was set up in June following a data leak earlier in the year from Panama-based law firm Mossack Fonseca.

The documents revealed the hidden assets of hundreds of politicians, officials, current and former national leaders, celebrities and sports stars.

MEPs will investigate whether EU governments and the European Commission failed to properly implement EU anti-tax avoidance and financial transparency rules.

They will also consider whether governments were in breach of their treaty commitment of “sincere cooperation” by not taking action against secretive tax avoidance structures.

Their final report is due to be published before June next year.

Mossack Fonseca sign
AFP/GETTY

Apologies

Panama Papers inquiry committee

European Parliament

Brussels

Apologies - but our video stream is not working at the moment - we are trying to rectify this as soon as possible. 

In the meantime, the committee is being broadcast on the EBS website here

Good Morning

European Parliament

Brussels

Hello and welcome to coverage of the European Parliament’s inquiry committee into the Panama Papers affair.

This morning the committee will be taking evidence from Nobel Prize-winning economist Joseph Stiglitz, who in August quit an advisory panel to Panama's government set up after the scandal.

Mr Stiglitz and Swiss anti-corruption expert Mark Pieth said they were concerned that the panel's final report would not be published.

"We can only infer that the government is facing pressure from those who are making profits from the current non-transparent financial system in Panama," Mr Stiglitz told Reuters at the time. 

The Panamian government said it was committed to transparency, and attributed the resignations to “internal differences”.

Yesterday Mr Stiglitz and Mr Peith published their own report, which advocated cutting non-cooperative tax havens off from the global financial system.