The United Kingdom (UK) has rejected a proposal for the British Virgin Islands to implement a public register that would reveal the names of beneficial owners of offshore companies registered in the territory.
A beneficial owner is effectively a person who enjoys the benefits of ownership in a financial services company even though the title of the company is in another name.
In a continuing fight against money laundering and tax evasion, a number of UK officials have been pushing the BVI to make the names of these beneficial owners public.
But, when the proposal for a public beneficial ownership register in the BVI and in five other British Overseas Territories was put to the UK’s House of Lords last week, majority voted against it.
The vote happened during a debate for an amendment to the UK’s ‘Sanctions and Anti-Money Laundering Bill’.
The final tally after the vote was 211 to 201.
The six Overseas Territories that would have been affected are Anguilla, Bermuda, the Cayman Islands, Montserrat, Turks & Caicos Islands, and the BVI.
According to international media reports, UK politicians who voted against the proposal argued that implementing a public register in these Overseas Territories can lead to identity theft.
They also reasoned that implementing public registers would put Overseas Territories at disadvantage to their financial services competitors.
Officials such as the UK’s Foreign Office Minister, Lord Ahmad said the BVI and other Overseas Territories have managed and regulated their respective financial services sector well.
Premier Dr D Orlando Smith was happy for the endorsement by Lord Ahmad and other UK officials who voted against the public register.
“The Minister’s supportive words are very welcomed. His robust defence of the standards set by the BVI reinforces the sound financial footing on which our business and financial services rest. As we continue to recover from the devastation caused by the hurricanes it is gratifying to see that our industry continues to be held in high regard by the UK Government. As always, we will remain engaged with the UK Government and global standards-setters to ensure that the BVI continues to maintain its position as a leading international business and finance centre,” Dr Smith said during a conference with members of the media last week.
The Premier added: “The UK government reasserted its view that such a move [for us to implement a public register] would be a backward step both from a constitutional point of view and because of the progress that has been made in co-operation with the Overseas Territories in recent years,” he added.
Over the years, there has been a debate on whether information on beneficial owners should be made available to the public, or strictly to ‘competent authorities’ such as law enforcers.
The BVI – which remains under international scrutiny because of allegations of being a tax haven – signed an agreement back in 2016 with the then David Cameron-led UK government to share certain information in relation to beneficial ownership.
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