BVI News

UK votes against beneficial ownership register in BVI

Photo depicting sections of Tortola. Photo by Davion Smith/BVI News Journalist

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.

Pleased Premier

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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20 Comments

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  1. Albion says:

    The vote didn’t pass this time. But they will keep coming back. They always do. The BVI Government must give up the idea that if they just give in one more time to the UK, then that means they will finally go away and stop bothering us. They will never stop, and that is the mindset we need to be aware of when we discuss these things with them.

  2. A says:

    wise and far sighted vote we can live by and prosper, particularly in the current fiscal rebuilding mode.

    Secondly, the BVI has and will continue to handle its economic affairs quite well.

    Hope there are serious efforts and negotiations on the way to import at least two mega hotels and a few other industries.

    Let’s get to work NDP!!

  3. Hmmm says:

    More trouble. This place like it has a curse on it lately. The sooner we take the NDP out of office the sooner the curse will leave.

    • Time will tell says:

      Lol.. Do you really think any one inthe VIP or any other party that comes on stream has the knowledge or experience to deal with the issues of this country’s biggest revenue contributor? I kid you not – they don’t have a clue!!

  4. Reply says:

    This was a very close but important vote. The BVI dodged a bullet. Had the vote gone the other way, the financial services sector would have taken a direct hit and it’s future viability would have been imperiled.

    While the government claims that the financial sector operates in a transparent manner already, the truth is the financial sector flourishes in the ability of many of these offshore companies to operate in secrecy.

    Even the Queen reportedly has some off shore accounts as per The Paradise Papers:

    Read more at: https://www.oneindia.com/international/paradise-papers-leaks-reveal-queen-elizabeth-ii-s-offshore-investments-2576947.html

    Why else would the Premier be pleased with the outcome of the vote? Because he knows the minute the Caribbean sunlight hits the financial sector, he can kiss that sector goodbye.

    Anyway, there is a part of me that likes this outcome, because I simply do not like how the G20 and other countries are trying to control the financial world largely for their own interest.

    So chuck one up for the BVI financial sector. The little fish who was surrounded by hungry sharks, who just managed to swim away.

  5. Not2Sure says:

    What was interesting about the debate in Parliament is that there was a real sense of hostility to public registers – not just in BVI and other offshore territories – but in the UK as well. Politicians are starting to realise that so long as law enforcement has access to the information, there is no need to open up people’s private affairs to nosy members of the press.

    Hopefully this is an idea which has had its day and now it will die quietly away.

  6. Poison. says:

    Sorry chap it ain’t the ndp is bad minded ppl like yourself that make it difficult for the decent ones. Everyone from the great aunt looking a handout even those who could afford and don’t need it want a handout. Financial services suffered many attacks these past few years under this government but they have held their own and did well. I must commend them.

  7. Longshanks says:

    A very narrow defeat this time. But now it returns to the commons. Constitutionally there are a whole lot of questions, but right now the BVI is in an unfortunately weak position.

  8. Expat says:

    Is the UK parliament can make decision to for the BVI and those territory. Then we should have representation and a vote.

  9. Careful says:

    We got lucky.
    But ask yourself why these people are attacking the offshore sector. Is it because they are wicked people out to do us harm? Is it because they are envious of other people’s wealth? Or is there a serious moral issue that the BVI pretends does not exist – like the fact the whole set-up, whether ‘legal’ or not, (who makes the laws? The rich and influential), offers a perfect set of rabbit holes for all kinds of dirty money stolen from poor people in Africa and other nations, and a handy set of mechanisms for the rich – who are getting richer – to avoid paying taxes in their home countries. The poor don’t have the ability to dance past the taxman like they do, and are themselves getting poorer. 48 people own as much wealth as all the rest of the world now. A gap this size has never happened in history and we’re one of the main reasons it’s happening.
    Good that the BVI didn’t lose its crucial economic pillar. Lord knows we need it right now. But just because we rely on it, doesn’t mean financial services industry is an overall good thing for the little guy here, or anywhere else in the world.

  10. watcher says:

    Public registers are a disaster. Even the voters roll in the UK is the source for the double glazing and kitchen companies and other hustlers to ring up and harass householders. Who knows what grief the people on the proposed lists would suffer. And lets be right, there is nothing at all wrong with owning shares in a BVI company.

    Also not everyone realizes that you can create a UK company on line for $50 and that there is no check whatsoever on the names or addresses of the beneficial owners and certainly no public list. What is sauce for the goose should be sauce for the gander.

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    If you want to live in France and spend your life there you should select a proper house. French property is not cheap and you need to make a major investment. You must also know about the properties for sale in France at various locations. The houses for sale in France come in different prices depending on the location

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