Company Beneficial Ownership Information (UK0048)
Action Plan Cycle: 2013
Lead Institution: Department for Business, Innovation and Skills, HM Treasury
Support Institution(s): CSOs: CAFOD, Christian Aid, Global Witness, ONE, Open Knowledge Foundation, OpenCorporates, Oxfam, Save the Children, Tearfund, Transparency International UK
Policy AreasAnti-Corruption, Beneficial Ownership, Fiscal Openness, Legislation & Regulation, Private Sector, Tax
A lack of knowledge about who ultimately controls, owns and profits from companies and legal arrangements facilitates their misuse for illicit purposes including tax evasion, money laundering, corruption and bribery.
The UK is committed to lead by example to implement international standards on transparency of ownership and control to tackle the misuse of companies and legal arrangements. In particular, the UK has committed to place a requirement on companies to obtain and hold adequate, accurate and current information on their beneficial ownership – defined as the natural person(s) who ultimately owns or controls a legal person or arrangement.
Company beneficial ownership information will be held in a central registry maintained by
Companies House. The UK sought views on whether information in the registry should be made
publicly accessible. A large number of respondents to the consultation supported this in the interests of promoting positive corporate behaviour and transparency, though concerns were also expressed, notably around competitiveness impacts and privacy. Having carefully
considered the arguments for and against, the UK has committed to making information on
individuals with significant interests in UK companies accessible publicly via Companies House, potentially using as a model the type of information already in the public domain on company shareholders.
As we further develop the policy we will give careful consideration to:
- how we can best protect individuals who might be at risk of harm through disclosure of this
- the sanctions that will apply if individuals or companies deliberately provide false
information, or fail to provide information
- how the registry will operate in practice
This will help ensure the robust implementation of the new requirements.
In parallel, the UK is taking forward related G8 commitments to enhance corporate transparency and has sought views on the following issues:
- the prohibition of new and existing bearer shares, which allow company shares to be traded anonymously
- enhanced transparency around the use of nominee directors, which can be used to conceal who really controls a company
- the prohibition of corporate directors, which can be used to create an opaque corporate structure
Furthermore, we continue to pursue the same level of ambition through the EU, G8 and the
G20. All G8 countries have published action plans on beneficial ownership. The G20 also
declared at St Petersburg this year that they too will lead by example on implementation of beneficial ownership requirements, and G20 leaders have tasked finance ministers to update the G20 next year on steps taken to meet the relevant international standards. In the EU, the UK is continuing to push for an ambitious approach in the context of proposals for a Fourth EU Money Laundering Directive.
Through the UK’s G8 action plan on beneficial ownership, the UK is taking forward a number of other commitments. We are currently undertaking the UK’s first ever national risk assessment of money laundering and terrorist financing threat to be completed in 2014. We also committed to improve the supervision and enforcement of those that facilitate company formation in the UK. HM Revenue and Customs (HMRC) are currently leading a review of supervision and enforcement of trust and service providers which will include consideration of additional measures to ensure company formation agents conduct effective due diligence including the identification and verification of beneficial owners. We will also take forward work in the context of the national risk assessment to assess the money laundering and terrorist financing risk posed by trusts, and through the Fourth EU Money Laundering Directive we will seek to ensure that trustees of express trusts are obliged to obtain and hold adequate, accurate and current information on beneficial ownership regarding the trust. Furthermore, we are working hard in the OECD to establish a new global standard on automatic exchange of information which the G20 has called for by February 2014. This will provide greater transparency over trusts than ever before, providing the authorities with more information to tackle the misuse of trusts.
Timescales: The government discussion paper relating to these commitments has informed this action plan. Implementation will now be taken forward through amendments to company law, led by the Department for Business, Innovation and Skills, and through: transposition of the Fourth EU Money Laundering Directive, which is currently being negotiated; amendments to the UK Money Laundering Regulations; and other relevant bilateral and multilateral agreements led by HM Treasury.