The register will reveal the beneficial ownership behind legal structures, such as shell companies.
Kelly O’Dwyer, Australia's minister for financial services, said: “Improving transparency around who owns, controls and benefits from companies will assist with preventing the misuse of companies for illicit activities; including tax evasion, money laundering, bribery, corruption and terrorism financing.”
The government first announced plans to set up a register in May last year at the UK Anti-Corruption Summit.
Panama Papers push
There has been increasing public pressure for policymakers to crack down on multinational tax avoidance and corporate corruption following the Panama Papers scandal.
The Australian government reaffirmed its commitment to a consultation on the details, scope and implementation of a register, as part of the Open Government Partnership National Action Plan, released on 7 December 2016.
The consultation is looking for feedback on the type of information that should be collected, and how it should be stored and kept up to date.
The opposition party had accused Australia’s coalition government of dragging its feet on the issue. However, parts of the corporate sector still oppose a register, considering it an over-reaction to the problem.
The use of registers of this kind has precedent. The UK, for example, created a national register of beneficial ownership through the Small Business, Enterprise and Employment Act 2015.
This requires small businesses and partnerships to keep a register of people with a major beneficial interest (defined as holding more than 25% of the share capital or voting rights).
In November 2016, a UK parliamentary report said: “There are longstanding concerns that, when companies, land or real property are bought through shell companies, so disguising their true ownership, the resulting lack of transparency may allow corruption or crime to flourish.”
The Australian government’s consultation paper closes on 13 March 2017.