UK companies will have to list their “beneficial owners”, business secretary Vince Cable has said.
This confirms earlier reports that such plan was in the works, in conjunction with other G8 governments, as part of an effort to combat tax evasion and money laundering.
Earlier this year, The European Parliament approved draft anti-money laundering rules that would require the ultimate owners of companies and trusts to be listed in public registers in all EU countries.
Last year, UK prime minister David Cameron announced that 10 of Britain’s overseas territories and crown dependencies needed to begin to make beneficial ownership information about the companies in their borders more readily available “to law enforcement [agencies] and tax collectors”, saying, "put simply…we need to know who really owns and controls each and every company".
In March, as reported, companies and organisations with a presence in the Cayman Islands weighed in on that island's plans to introduce such a registry, with most expressing criticism of the plan. The Isle of Man has also been looking into the matter.
Parliamentary approval required
The new registry outlined by Cable would require parliamentary approval. All those with a 25% or greater share of a company’s ownership or voting rights would be named, and the list would be updated annually.
According to published reports, Cable said that forcing companies to list their owners publicly would deal with the “darker side of capitalism, and the smoke and mirrors which have existed for too long”.
“No longer will UK companies be able to use complex structures and trails of paperwork to hide information and keep the public in the dark,” Cable said.
The government is also said to be planning to abolish “bearer shares”, which permit partial stakes in companies to be transferred without the need to register the transfer.
Last year, Baker Tilly’s George Bull noted that the decision to make the list of beneficial owners public would set a benchmark against which other countries would be judged in the battle to combat tax evasion.