Crown Dependencies announce that beneficial ownership registers will not be available to the public

Thursday, 14 December 2023
The Crown Dependencies of Guernsey, the Isle of Man and Jersey have jointly announced that they are withdrawing their previous commitments to allow general public access to their registers of company beneficial ownership.
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This follows a similar announcement made by the British Virgin Islands (BVI) on 8 December 2023 and is based on a November 2022 Court of Justice of the European Union (CJEU) decision. The CJEU stated that unrestricted public access to such registers poses a disproportionate threat to privacy and should be limited only to those with a 'legitimate interest' in the information. That judgment (WM & Sovim SA v Luxembourg Business Register, 2022 EUR-Lex - 62020CJ0037) had the effect that EU Member States are now obliged to provide access to their beneficial ownership registers only to law enforcement, financial services institutions and other persons with this legitimate interest. The extent to which access is provided on the last of these grounds varies across the EU and is currently being given further consideration by the European Commission and Member States.

The Crown Dependencies' and BVI's announcements replace the commitments they made in 2019, undertaking to introduce public registers of beneficial ownership information when this became a global standard.

'Having carefully considered the CJEU’s decision in WM and relevant ECtHR [European Court of Human Rights] case law, the governments of the Crown Dependencies are satisfied that it would not be compatible with the international obligations extended to them, including those enshrined in their domestic laws, to grant access to their beneficial ownership registers to the general public', says the Crown Dependencies' joint statement.

However, they have undertaken to work towards extending access to their registers 'having regard to relevant developments in the EU and international best practice'. They will enable access for 'obliged entities', businesses required to conduct customer due-diligence under anti-money laundering (AML) legislation, before the end of 2024. There will be 'appropriate safeguards to effectively manage any interference with privacy rights'.

They will also 'develop and deliver legitimate interest access in a leading timeframe'. The definition of legitimate interest is developed with due regard to international good practice, including finalisation of the EU Sixth Anti-Money Laundering Directive, which is anticipated in early 2024. The resulting proposals will be put to the Crown Dependencies' own parliaments by the fourth quarter of 2024 at the latest and will be implemented in a 'reasonable' timeframe.

 A similar policy is embedded in the Cayman Islands' Beneficial Ownership Transparency Bill 2023, passed by parliament on 23 November 2023. The Act contains a clause that would enable the jurisdiction's cabinet to make regulations to provide a limited form of public access to specified beneficial ownership information. Such regulations will have to be affirmed by parliament and would be subject to prior public consultation.

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