Freedom in the World
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Civil Liberties (1 = best, 7 = worst)
Political Rights (1 = best, 7 = worst)
In February 2009 parliamentary elections, the Patriotic Union’s Klaus Tschuescher was elected prime minister and subsequently formed a coalition government with the Progressive Citizens’ Party. As the economic crisis continued to worsen, Liechtenstein agreed to ease bank secrecy laws, allowing for the country’s removal from the Organization for Economic Cooperation and Development’s list of uncooperative tax havens.
Liechtenstein declared in 2006 that it would make no further changes to its banking-secrecy laws. However, its European neighbors renewed their tax-related complaints in 2008 as the economic crisis prompted new concerns about tax havens. In December 2008, Liechtenstein and the United States came to an information-sharing agreement on tax evasion investigations. Liechtenstein agreed in March 2009 to adopt Organization for Economic Cooperation and Development (OECD) transparency and information-sharing standards, including a commitment to exchange data on clients in both tax fraud and tax evasion investigations by foreign governments.
Liechtenstein is an electoral democracy. However, the unelected monarchy won greater authority in 2003, making it the most politically powerful in Europe. The unicameral Parliament (Landtag) consists of 25 deputies chosen by proportional representation every four years. These freely elected representatives determine the policies of the government, but the monarch has the power to veto legislation, dismiss the government, and appoint judges. Voting is compulsory.