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UK tax havens more exposed than ever after EU moves to end company secrecy

17 December 2014 - The UK’s tax havens came under new pressure today to end their extreme financial secrecy after the European Union moved to shine a light on who really owns millions of companies.

“Europe’s decision to create national registers of companies’ real owners greatly increases the pressure on UK-controlled tax havens such as the British Virgin Islands and the Cayman Islands to follow suit,” said Joseph Stead, Senior Economic Justice Adviser at Christian Aid.

“As Europe and the UK itself take major steps towards transparency, it makes the extraordinary secrecy of the UK’s tax havens look more indefensible than ever. It also makes things more embarrassing for David Cameron, who told the Overseas Territories in April to make quick progress on transparency, only to be ignored.”

Last week Cayman Islands Premier Alden McLaughlin announced that all the Overseas Territories and Crown Dependencies will ignore David Cameron and continue to allow the owners of shell companies registered in their jurisdictions to hide in the economic shadows.

Mr Stead added: “Premier Alden McLaughlin claimed that the Overseas Territories would not move until other countries did.  We now have the 28 members of the EU committed to creating central registries with a degree of public access, so that excuse doesn’t work anymore.”

Christian Aid’s welcome of the EU decision is  qualified by the fact that although European countries have agreed to create national registers of the people who own and control companies, public access will be restricted to those with a ‘legitimate interest’.

The registers are important for catching up with criminals who use anonymous shell companies for crimes including tax evasion, corruption, fraud, money laundering and even terrorist financing.

Joseph Stead said: “While the European agreement is not perfect, not least because the chance to restrict public access will reduce the registers’ crime-fighting power, this is still a significant step forward in the increasingly inevitable move towards public registers of companies globally”. 

The European move against company secrecy is the result of an agreement between the European Parliament and Council of Ministers, reached yesterday. . The deal will be implemented through an amendment to the EU’s Anti-Money Laundering Directive.

The colour red dominates a recent ‘traffic light assessment’ of UK tax havens’ progress towards company transparency, released by Christian Aid and Global Witness last month.

For more information please contact Rachel Baird on 0207 523 2446 or rbaird@christian-aid.org  24 hour press duty phone – 07850 242950


Notes to editors:

1. Christian Aid works in some of the world's poorest communities in around 50 countries at any one time. We act where there is great need, regardless of religion, helping people to live a full life, free from poverty. We provide urgent, practical and effective assistance in tackling the root causes of poverty as well as its effects.

2. Christian Aid’s core belief is that the world can and must be changed so that poverty is ended:  this is what we stand for. Everything we do is about ending poverty and injustice: swiftly, effectively, sustainably. Our strategy document Partnership for Change explains how we set about this task.

3. Christian Aid is a member of the ACT Alliance, a global coalition of more than 130 churches and church-related organisations that work together in humanitarian assistance, advocacy and development.  Further details at http://actalliance.org

4. Follow Christian Aid's newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit http://www.christianaid.org.uk

 

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