Earlier this year, MPs passed an amendment to the Sanctions and Anti-Money Laundering Bill to impose, by 2020, a transparent register of beneficial ownership of companies on the British Overseas Territories, such as Bermuda, Cayman and the British Virgin Islands.
It is feared that the move will undermine their financial services industries, where client confidentiality is highly valued.
The Crown Dependencies – Jersey, Guernsey and the Isle of Man – escaped a similar fate after a similar clause concerning them was dropped at the last minute.
Senior ministers in the Overseas Territories have complained that the move was ‘unconstitutional’ and ‘discriminatory’ because they were targeted and not the Crown Dependencies.
Lorna Smith, the executive director of BVI Finance, has, according to media reports in the Caribbean jurisdiction, said that firms are already considering leaving the affected territories because of Parliament’s decision.
‘People are already saying: “Why don’t I move my business to a Crown Dependency – to the Isle of Man or to Jersey instead of the British Virgin Islands? Why don’t I move it now rather than waiting for 2020?”,’ she said.
‘So that’s a serious consideration and one which [makes] you really wonder whether the United Kingdom parliament thought of those kinds of consequences as a result of this decision.’
Jersey currently does not have a publicly available company beneficial ownership register. It does, however, provide its register to tax and law enforcement authorities in other jurisdictions on request.
Industry leaders also say that the Island’s register is more accurate and detailed than public registers that have been introduced elsewhere, such as in the UK.
Labour MP Dame Margaret Hodge and her Conservative counterpart Andrew Mitchell MP are planning to visit Jersey in the autumn to try to persuade the Island’s leaders to introduce a transparent register here. This week Conservative MP John Glen, who is the Minister for the City of London and responsible for the UK’s financial services industry, said that the Crown Dependencies had ‘committed’ to introducing transparent registers when they become the global standard and that the UK was pushing for this to be the case by 2023.
The External Relations Department has denied that the Island has made such a commitment, however, and said that the Island would only ‘consider’ introducing a fully transparent register if it became the international norm.
