Britain’s decision this week to force its overseas territories to make company ownership public has drawn angry responses from jurisdictions around the world, with the CEO of Cayman Finance the latest to issue a damming rejection of the proposed new law.
Britain’s House of Commons backed an amendment to the anti-money laundering bill, which will force the country’s overseas territories to disclose the ownership of companies and assets registered in their jurisdiction.
In a strongly-worded statement Jude Scott, CEO of Cayman Finance, defended his jurisdiction’s “leadership” in championing transparency: “Cayman’s existing verified ownership regime remains in force – and remains superior to existing ownership regimes in the UK and around the world. This vote simply continues the legislative process for potentially requiring changes to Cayman’s ownership regime more than two years from now, during which time there will still be on-going dialogue with the UK.
Scott (pictured below) argued that by voting down a requirement to perform basic anti-money laundering checks on the hundreds of thousands of UK companies formed annually through Companies House, Parliament was guilty of “a remarkable display of double standards.”
‘A vain attempt’
“The House [of Commons] vote is a vain attempt to fight global problems like corruption and tax evasion by unfairly discriminating against a few jurisdictions – requiring public registers from Overseas Territories but not Crown Dependencies, for example. Global problems require global solutions and standards that apply to all jurisdictions,” he said.
Britain’s 14 overseas territories, or BOTs, responded yesterday with a mixture of perplexity and anger to Tuesday’s news that the UK is going to require them to adopt public beneficial ownership registers by 2020.
Crown Dependencies win excemption
The sense of shock was compounded by the admission that the three Crown Dependencies (Guernsey, Jersey and the Isle of Man) have been told they will not have to comply with the pending legislation. It is understood the Crown Dependencies won an exemption from the legislation thanks to last-minute lobbying by their representatives.
‘A world-class verified ownership regime’
Jude Scott spoke for many when he wrote: “The Cayman Islands is a transparent jurisdiction that already meets or exceeds the full range of globally-accepted standards for transparency and cross-border cooperation with law enforcement and tax authorities. Cayman became an early adopter of automatic data exchange by signing onto agreements such as the EU Savings Directive, the OECD’s Common Reporting Standard (CRS), FATCA, and country-by-country reporting principles under the BEPS process.
He pointed out that the Cayman Islands already has “a world-class verified ownership regime” that has been “in place for more than 15 years.” By contrast, Scott said, “only eleven out of 28 EU countries have a register at all.”
“For all of those reasons, the OECD’s Global Forum in 2017 assessed our jurisdiction to be “largely compliant” with the international standard for transparency and exchange of information, the same rating given Canada and Australia.”
Scott’s remarks echoed those of Eric Bush, the Cayman Islands’ representative to the UK, who told BBC Radio 4 yesterday the decision “shows a lack of trust, it shows a lack of respect, and disregard to the constitution and the agreements and the long-standing, mutual respect between the Cayman Islands and the UK.”