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Building a Beneficial Ownership Registry Proposal for Chile

Construyendo una Propuesta de Registro de Beneficiarios Finales para Chile

Michel Figueroa|

One of the key challenges that states face is promoting sustainable economic growth through competitiveness and efficiency. Economists and businessmen have developed tools and strategies to address market distortions and maximize social wellbeing. But citizens and civil society have largely been absent from the process. 

Chile is no exception. It remains a challenge to create dialogue spaces and to reach a consensus that benefits the whole of society. But what happens when we create spaces that allow for different points of view to be confronted to solve economic inefficiencies? What happens when civil society and the public and private sectors discuss alternatives to well-being issues, taking into account the views of those who are closest to the issues and to the implementation of solutions? 

Through the co-creation of Chile’s fourth Open Government Partnership (OGP) action plan for 2018-2020, civil society organizations, such as Observatorio de Gasto Fiscal and Chile Transparente, highlighted the need to improve tools to prevent, monitor and prosecute corruption in the private sector. 

Disclosure of the beneficial owners of companies is in the common interest of governments and civil society to help them fight money laundering and the financing of terrorism. International recommendations by GAFILAT and UNCAC, which promote concrete solutions in a context of civil society advocacy and political will to respond to issues, led to the inclusion of beneficial owner transparency in the public agenda. 

This common interest and the interest by the Financial Analysis Unit (UAF in Spanish), the agency in charge of preventing money laundering, of leading a multi-stakeholder effort to improve information registries created a window of opportunity to collaboratively build a proposed policy on the creation of a beneficial ownership register in Chile’s fourth action plan. 

Once the commitment was drafted, the fiscal authority and the entity in charge of managing public acquisitions created an intersectoral committee to support its implementation. The committee, led by UAF, also held a public consultation on the creation of a register of real owners. 

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Beneficial owner registries are effective tools against corruption, so they need to be at the center of the open government agenda at all levels of society.

Transparency International Chile

Despite the challenges posed by the pandemic, UAF’s work did not just lead the process successfully but also ensured the inclusion of the opinions, perspectives and recommendations of the rest of the members of the committee. 

Following the creation of the committee, we began organizing a feasibility study of the beneficial owner register and identifying national and international sources of information that could help achieve the goals of the commitments. Stemming from this commitment and from the dialogue between public officers and civil society organizations, the first proposed regulation was created and was subject to public consultation to incorporate different views. 

The creation of the multi-stakeholder committee was key to the process since it included the opinions of key stakeholders and promoted the creation of a proposal that included the concerns and needs of key stakeholders. Key to the process was building partnerships that allowed the integration of different views and promoted collaborative work toward a common goal. These efforts need to align: 

  • Set shared goals among public and private stakeholders, and civil society. 
  • Build strong leadership with the ability to promote dialogue 
  • Open up spaces for inter-institutional coordination and collaborative work. 
  • Build consensus, rather than focusing on differences
  • Establish shared responsibilities and timelines for all relevant stakeholders
  • Use smooth communication channels

In December of 2019, the government of President Sebastian Piñera presented an “Antiabuse agenda” that seeks to promote a political and legislative agenda to fight corruption and help reduce power and information asymmetries between companies and the citizenry. The agenda focuses on promoting transparency in public procurement and disclosure of the beneficial owners of companies that provide services to the State and “identify and fight conflicts of interest and avoid excessive concentration of power in the provision of goods and services to the State”. This agenda recognizes and reflects some of the debates and agreements reached during the implementation of this commitment. 

The greatest innovation in the process is the ability of civil society and public stakeholders to join their views, build a collective learning process that allows to integrate their successes and failures into the development of a proposal to improve the competitiveness of public works, obstruct the mechanisms to facilitate corruption in companies, and put the people at the center of economic well being. 

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