The Government has this week formally joined the Beneficial Ownership Leadership Group as part of plans to drive transparency in the private sector.
It means the UK will adopt best practice beneficial ownership disclosure principles, such as disclosing who owns and controls British companies.
According to the Government, the move “builds business and market confidence”, “helps tackle corruption and criminal activities” and can “improve governance and public procurement”.
The scheme – launched by members of the G20 – will introduce a raft of new and existing international standards, including creating “free to access and publicly accessible registers”, across a “diverse range of countries and asset classes wherever possible”.
The best practice beneficial ownership disclosure principles include:
- Publishing company beneficial ownership data that is freely downloadable, searchable, and reusable by the public, without a fee, proprietary software, or the need for registration.
- Implementing progressively ambitious best practice in beneficial ownership transparency, across technical, legislative, regulatory, and administrative parameters.
- Contributing to the building of best practice, including by recognising the evolving illicit finance threat and considering implementing beneficial ownership transparency beyond companies to a wider group of assets classes.
- Structured, machine-readable format compliant with the Beneficial Ownership Data Standard, which provides a technical model for beneficial ownership data that enables the data to be linked transnationally.
- Protocols for identifying and investigating red flags in the data, including collaboration and accountability between registrars and law enforcement.
- Granular, high-quality, and consistent enough to enable effective red flagging. Members should take reasonable steps on the following issues:
- Closing loopholes left open by high thresholds, banding, lack of historical data, and inconsistent use of identifiers for people and entities.
- Representing the full chain of beneficial ownership, from the ultimate beneficial owner to the target company, including all domestic entities in between.
- Ensuring high compliance with requirements to report and update data.
- Authentication of individuals reporting beneficial ownership data.
- Good validation of reported beneficial ownership data.
- Exemptions regime that protects vulnerable individuals but does not allow abuse, as set by best practice.
Click here to learn more about the Beneficial Ownership Leadership Group.
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