Press release / May 12, 2016

Anti-corruption summit sees bold moves on property and travel, but a glaring blind spot in the tax havens

Global Witness spokespeople available at the Summit: +44 7545 645 406

Reaction

On company ownership: “Change is coming. Sixteen countries [1] have now committed to move towards public registers of the real owners of companies - this time last year there was just one. The UK is commended for leading on this issue, but as more countries with long histories of corruption come out of the shadows, it highlights the glaring lack of progress in our tax havens. They must be opened up if we’re to crack the global corruption problem,” [2] said Robert Palmer, Head of Global Witness’ Money Laundering campaign.  

On UK property: “The UK government has recognised the dirty money problem in its property market and announced clear measures to tackle it. If these are swiftly enforced and fully resourced, they will go a long way to ensuring UK property is no longer a dumping ground for dirty cash. It’s a huge step,” said Chido Dunn, Senior Campaigner at Global Witness. 

On denying entry to the corrupt: “Commitments to make it harder for the corrupt to travel and do business in the world’s financial system are very welcome. Looting state coffers is only worth doing if you have somewhere safe to put it and somewhere fun to spend it. But so far these are just promising words - they need to be backed up with action to make sure we’re no longer providing safe havens to the corrupt,” said Ellie Nichol, Head of Global Witness’ No Safe Haven campaign.  

On trusts: “The progress made on shining a light on company ownership is fantastic, but will be lost unless the ownership and control of trusts is also brought into the light.  It is therefore brilliant that France has led the world and committed to create the world’s first public registry of trusts.  Doing so puts pressure on the UK to do the same,” said Palmer.

Below are Global Witness’ calls for the Summit, and further reaction to the announcements so far. For our full brief of policy calls, see here:

  • The UK should require its tax havens to put the names of the people who own and control companies into the public domain, just as British companies are now required to do. However, only small steps forward have been agreed. All the UK havens except the BVI and the Turks and Caicos will share beneficial ownership information with law enforcement 40 participating countries; all UK havens will share information with UK law enforcement [3].    

Further reaction: “Research shows British tax haven companies are the favourite tool of the corrupt,” said Palmer.  “Some British tax havens committed to automatically share beneficial ownership information with law enforcement from a select number of other countries. But those digging their heels in, such as the British Virgin Islands, are where the problem is worst.  Sharing information with law enforcement is a small step forwards but what’s really needed is for the information to be public for all to see. Automatic exchange schemes are also problematic as they disadvantage developing countries,” said Palmer.  

  • Countries should commit to put the names of the people who own and control companies and trusts into the public domain for all to see.  Substantial progress has been made on this, with new commitments for company transparency from France, Nigeria, Afghanistan, New Zealand, Jordan, Indonesia, Ireland and Georgia [4], and with France [5] committing to make its register of trusts publicly available – a world first.  

  • The UK should legislate to prevent the corrupt from purchasing property in the UK, by requiring companies that own or buy UK property to make details of their beneficial owners public.  The UK government has committed to do this, not just for new purchases but also for people who have already bought property via a foreign company. 

Further reaction: “The government has listened on this issue, and acted decisively.  So much money is currently laundered through UK property, and an area of British land more than three times the size of Greater London is owned by secret companies in offshore jurisdictions. If today’s measures are swiftly enforced and fully resourced, they will really help keep the dirty money out,” said Eleanor Nichol, Head of Global Witness’ No Safe Haven campaign

  • Governments to refuse to roll out the red carpet to the corrupt, by not granting visas or citizenship to corrupt individuals.  As above. Global Witness welcomes the commitment to deny global mobility for the corrupt. These now need to be backed by action. 

 To arrange an interview with Global Witness, contact:

  • Oliver Courtney on +44 7912 517 147 or [email protected]
  • Robert Palmer, at the Anti-Corruption Summit, on +44 7545 645 406


/ ENDS

Notes to editor:

  1. Countries committing to publish public registers of company beneficial owners are: UK, France (including trusts), South Africa, Netherlands, Nigeria, Afghanistan, Norway, Kenya, Ukraine and Ghana. Countries committed to taking initial steps towards public registers of company beneficial owners are: Indonesia, Australia, Ireland, New Zealand, Jordan and Georgia.
  2. Research carried out by the Stolen Assets Recovery Initiative of the World Bank and UNODC showed that Overseas Territories companies are the favourite of the world’s corrupt, http://star.worldbank.org/star/sites/star/files/puppetmastersv1.pdf
  3. Jersey, the Isle of Man, Cayman Islands, Bermuda, Gibraltar, Anguilla and Montserrat announced that they would join the automatic exchange of beneficial ownership scheme.  Guernsey will do so soon.  The BVI and Turks and Caicos have not announced that they will join. 
  4. The Netherlands and Australia also committed to introduce public registers of company ownership and control; these are commitments that were announced recently.  Separately, South Africa also recently announced that it will create a public registry of company ownership and control. 
  5. New decree issued by the French government on 11 May 2016, https://www.legifrance.gouv.fr/affichTexte.do;jsessionid=662EFC8E8C0552CDCF7DEECCD49E264C.tpdila14v_3?cidTexte=JORFTEXT000032511026

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