A Belgian court has asked the EU’s highest court to decide if FATCA-driven data transfers to US tax authorities violate GDPR and the fundamental rights of EU citizens.

A new chapter for “accidental Americans”

Belgium’s Court of Markets has asked the Court of Justice of the European Union (CJEU) to rule on whether Belgium can lawfully transfer the tax data of “accidental Americans” to US authorities under the Foreign Account Tax Compliance Act (FATCA). The Association of Accidental Americans (AAA) called the referral a “historic moment” after eight years of campaigning against what it sees as unlawful and discriminatory data sharing.

AAA president Fabien Lehagre described the decision as a victory of “law over politics,” arguing that European institutions can no longer avoid clarifying how far they may go in enforcing a US law that conflicts with EU privacy rules. For thousands of dual nationals in Europe, the CJEU’s eventual ruling could determine whether they must continue living under the constant threat of cross-border data transfers and US tax claims.

Who are “accidental Americans”?

“Accidental Americans” are people who acquired US citizenship simply because they were born on US soil, even though they often left as children and have no meaningful ties or economic presence in the United States. Despite this, they remain subject to the US system of citizenship-based taxation, which requires them to file US tax returns and potentially pay tax, regardless of where they live.

Under FATCA, banks around the world must identify customers who qualify as US persons and pass their account information to US tax authorities, either directly or via local tax administrations. In Belgium, this means the Belgian tax authority has been acting as an intermediary, collecting and forwarding the financial data of these individuals to the US Internal Revenue Service (IRS).

FATCA vs GDPR: the legal fault line

FATCA was designed as an anti–tax evasion measure, but in the EU it collides with the General Data Protection Regulation (GDPR), which imposes strict limits on what personal data can be collected, how long it can be kept, and where it can be sent. Since 2017, AAA has argued that FATCA implementation in Europe breaches GDPR principles such as proportionality, data minimisation, transparency, and the rules on international data transfers.

Belgium’s own Data Protection Authority ordered the government in 2023 to stop sharing this data with the US, labelling the practice unlawful under EU privacy rules. That decision was annulled by the Brussels Court of Appeal, only to be overruled again in early 2025, when Belgium was once more ordered to halt the transfers—an institutional tug-of-war that set the stage for the current referral to the CJEU.

Why the CJEU referral matters

By turning to the CJEU, the Court of Markets has effectively asked the EU’s highest court to define the boundaries of tax-related data collection and cross-border exchange inside the Union. AAA’s legal counsel, Vincent Wellens, called the move “a major step forward” because it forces a legal answer to questions that affect not only FATCA but “any large-scale tax-related data-collection mechanism.”

Among the core issues is whether EU states can maintain mass data-collection and transfer systems for tax purposes when those systems do not fully comply with GDPR, especially regarding international transfers and the requirement that data be limited to what is strictly necessary. The court is also expected to consider whether the EU–US Data Privacy Framework has any bearing on FATCA transfers, and whether collecting detailed financial information without any suspicion of fraud or evasion can ever satisfy the GDPR principle of data minimisation.

A turning point for EU fundamental rights

The CJEU’s answers will resonate far beyond the community of accidental Americans in Belgium. Any ruling that tightens GDPR scrutiny on tax data flows could ripple across Member States’ cooperation with third countries, especially in regimes built on bulk, preventive data sharing rather than targeted enforcement.

For EU institutions, the referral poses a stark question: can the fundamental rights of EU citizens be compromised to uphold a “imbalanced” bilateral agreement with a non-EU state, as Wellens suggests. Whatever line the CJEU draws between privacy and tax enforcement will help define how far Europe is willing to go in accommodating foreign tax demands when they collide with its own constitutional commitment to data protection and non-discrimination.

Source: : Maïthé Chini, “Top EU court to decide if Belgium can share ‘Accidental Americans’ tax data with US”, The Brussels Time