The British Virgin Islands government has officially announced its commitment to the implementation of public registers of beneficial ownership in the territory, despite "reservations".
Premier Andrew Fahie said: "Your government commits to working in collaboration with Her Majesty's Government towards a publicly accessible register of beneficial ownership for companies, in line with international standards and best practices as they develop globally and, at least, as implemented by EU Member States by 2023 in furtherance of the EU Fifth Anti-Money Laundering Directive (AMLD5)."
"It is of paramount importance that your government emphasises that this commitment is made with all due regard to the protection of, and proportionate safeguards for, all rights secured under our territory's constitution, and without prejudice to any interpretation of our constitution expounded by a court of law, whether in the past, pending, or in the future," Fahie explained.
There is need for concern that publicly accessible registers could be of more use to the prurient and ill-intentioned than those we seek to assist"
Beneficial owners are persons who own property rights to a company even though the legal title of the property is in another person's name. The aforesaid registers seek to make the identities of these ‘secret owners' public and other overseas territories are said to have already decided to implement them.
Premier Fahie made the statement in the House of Assembly where he said that despite his commitment, he still has a number of reservations on several of the UK's existing policies which he believes need to be changed.
"There is need for concern that publicly accessible registers could be of more use to the prurient and ill-intentioned than those we seek to assist, and in the BVI we do not believe that outsourcing supervision of corporate ownership to the public is a sustainable or legitimate policy," he stated.
"While it is a noble objective to seek the prosecution of terrorists, tax evaders and money launderers, the net that will be cast by the model of publicly accessible registers, as is being presently proposed, is disproportionate, since it can be used to breach the rights of the law-abiding and tax-paying individuals who are far greater in number than the targeted law-breakers," Fahie added in a letter to the UK minister responsible for Sustainable Development and Overseas Territories.
The decision follows a warning from the Governor Augustus Jaspert said the absence of a decision could hurt the BVI.
"Others will be better placed than me to talk about the financial services industry but there is a risk, for me, that BVI becomes an outlier rather than being one up there [at] the front of the pack." "We have successfully, throughout our years in financial services, shown that we are confident, we are innovative, that we get ahead of global trends rather than wait … and that has served us well in the last 25 years or more of our financial services industry," he added.
Eight of the UK's overseas territories had already committed to introducing publicly accessible registers of company beneficial ownership within the next three years as part of attempts to improve financial transparency, leaving the British Virgin Islands (BVI) as the only significant financial centre still to do so.
Premier Fahie said he will provide a statement in the House of Assembly with a further update on the subject within 12 months of the AMLD5 Implementation Review which is scheduled for January 2022.