UK agrees company public registers for Overseas Territories

Daniel NesbittThe UK government has accepted an amendment to the Sanctions and Anti-Money Laundering Bill which requires the Overseas Territories to establish public registers showing the beneficial ownership of companies.

The amendment, introduced by Labour’s Margaret Hodge and backed by MPs from all the major parties, commits the government to assisting the Overseas Territories in setting up registers by 31 December 2020. If registers have not been established by the deadline, the UK will be required to legislate to impose them.

An amendment which would have extended similar provisions to the Crown Dependencies was not backed by the government and was subsequently withdrawn.

The developments come after a government amendment which would have only required public registers if the Financial Action Task Force recommended them, was not selected for debate by the Speaker.

Debates on the Bill are scheduled to finish on 1 May 2018, and following Royal Assent, it will become law.

STEP will continue to monitor the impact this amendment will have, and will provide further updates where necessary.

Daniel Nesbitt, Policy Executive, STEP 

EU finance ministers approve changes to blacklist

Daniel NesbittWhen the European Union announced its blacklist of jurisdictions judged not to be cooperative on tax in December 2017 it granted several nations in the Caribbean extra time to change their tax systems to meet EU standards. That revised deadline has now passed and the EU’s finance ministers have approved a number of changes.

The following jurisdictions have been added to the blacklist:

• The Bahamas.
• The US Virgin Islands.
• Saint Kitts and Nevis.

As well as approving the additions ministers have removed Bahrain, the Marshall Islands and Saint Lucia from the list.

American Samoa, Guam, Namibia, Palau, Samoa and Trinidad and Tobago will remain on the blacklist.

A further four Caribbean jurisdictions have been placed on the grey-list of countries that have pledged to alter their practices:

• Anguilla.
• The British Virgin Islands.
• Dominica.
• Antigua and Barbuda.

One further jurisdiction, the Turks and Caicos Islands, has been given until 31 March 2018 to respond to the EU’s concerns.

STEP will continue to monitor the development of both the blacklist and the grey-list and will provide further updates when appropriate.

Daniel Nesbitt, Policy Executive, STEP 

EU tax haven blacklist confirmed

Daniel NesbittAfter much debate and scrutiny, an EU blacklist of jurisdictions deemed not to be cooperative on tax matters has been agreed. The announcement came following a meeting of the EU’s Economic and Financial Affairs Council, attended by the finance ministers of each Member State.

The list, officially called the Common EU List of Non-Cooperative Jurisdictions, includes the following 17 territories:

• American Samoa
• Bahrain
• Barbados
• Grenada
• Guam
• Macau
• The Marshall Islands
• Mongolia
• Namibia
• Palau
• Panama
• Samoa
• South Korea
• St. Lucia
• Trinidad and Tobago
• Tunisia
• The United Arab Emirates.

Work on the list began in 2015. Originally 92 countries were screened for compliance with the EU’s transparency criteria, and earlier this year, 53 were warned that unless they changed their tax rules, they risked being included on the blacklist.

The full consequences for jurisdictions on the blacklist will be decided in the coming weeks, although the document outlining the blacklist suggest a number of defensive measures Member States could take against non-cooperative jurisdictions. States such as Luxembourg have been reported to favour not implementing any sanctions whilst others, including France, are thought to be advocating tough measures.

The list will be reviewed annually, with a report on the progress of jurisdictions expected before summer 2018. The EU has also announced that in the future the assessment criteria will be expanded to include the transparency of beneficial ownership information.

In addition to the blacklist, a so-called grey list of a further 47 territories has been drawn up. These jurisdictions have fallen short of the EU’s criteria but have also committed to raising their standards. If they fail to abide by their commitments they will face being placed on the blacklist.

STEP will continue to monitor the situation closely, particular in regards to what happens to those on the grey-list and any further sanctions, and will provide further updates when necessary.

Daniel Nesbitt, Policy Executive, STEP