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UK MPs try to force Crown Dependencies to adopt public beneficial ownership registries

Monday, 4 March, 2019

A group of more than 50 UK MPs are attempting to force the Crown Dependencies (CDs) of Jersey, Guernsey and the Isle of Man to create publicly available registers of company beneficial ownership.

The MPs have tabled amendments to the Financial Services (Implementation of Legislation) Bill, now passing through the UK parliament, that would require the government to 'help' the three Crown Dependencies and 14 British Overseas Territories (OTs) set up their national registries by the end of 2020. The government has suspended this evening's scheduled debate on the Bill, because of the risk that the amendment would be carried.

Many of the same MPs proposed a similar amendment to the Sanctions and Anti-Money Laundering Act (SAMLA) last year, with the threat that they would be imposed by orders in council if not voluntarily adopted. That amendment, which applied only to the OTs, was reluctantly accepted by the UK government. Foreign office minister Alan Duncan told the Commons at the time of the SAMLA vote that the UK does not have powers to enforce orders in council on Jersey, Guernsey or the Isle of Man, whose constitutional settlement with the UK is different from that of the OTs.

SAMLA 2018's imposition of public registers on the OTs caused significant resentment, and the Foreign and Commonwealth Office has subsequently announced the registers won’t have to be operational until 2023. Now, the CDs have reacted angrily to the MPS' latest initiative. A joint statement issued by the three governments says the proposed amendments are 'contrary to the established constitutional relationships' between the UK and CDs and, if passed, would produce 'inoperable legislation'.

'We are not represented in the UK parliament, and it is a respected constitutional position that the UK does not legislate for the Crown Dependencies on domestic matters without our consent', said the statement.

Guernsey Finance's chairman Lyndon Trott, who was formerly the jurisdiction's chief minister, called the proposals 'misguided and wrong'. He said public scrutiny of beneficial ownership registers was 'irrelevant to their effectiveness and undermines the normal standards of privacy of personal affairs in a way that is as unreasonable as it is ineffective'. What was important, he said, was that registers are maintained and the data verified in real time, and that the data is available to appropriate tax, law enforcement, and security authorities in a timely manner. 'Guernsey's register meets all of these criteria to standards in excess of the UK's register and clearly complies with accepted international standards.'