The statement concludes by calling on the EU institutions, MEPs and Member States to take specific actions to ensure transparency of company and beneficial ownership registers.
As the Russian attack on Ukraine continues, there is a need to facilitate tracking the hidden wealth of Russian oligarchs and to ensure effective sanctions. To achieve this objective, 127 leading transparency, anti-corruption, open data and journalists organizations issued a statement on March 9 calling on European Union Institutions and Member States to act urgently to open company and beneficial ownership registers.
These organizations include Transparency International and its EU office as well as 22 national chapters. Transparency says that government leaders have for years pledged to end the abuse of anonymous shell companies and other opaque corporate structures. In practice, however, they have long resisted reforms.
The EU and its allies have rallied to support Ukraine, but without a robust system of transparent company and beneficial ownership data, detecting hidden Russian wealth is difficult, given that many use family members and networks of shell companies to conceal their assets.
Addressing the importance of transparent beneficial ownership, Maira Martini of Transparency International stated: “The Russian invasion of Ukraine must serve as a bitter wake-up call to Member States. It is time EU countries urgently fast-track key improvements to the Union’s beneficial ownership transparency framework. Information on the real owners of companies should be available for free, without restrictions and in open data format. This will enable civil society, journalists and law enforcement to track assets of Russian kleptocrats and hold them to account.”
The EU has shown that strength is in solidarity. It is time that the EU opens up company ownership registers, allowing civil society and investigative journalists to aid in the detection of corruption and unveiling of illicit assets.
The statement concludes by calling on the EU institutions, MEPs and Member States to take specific actions to ensure transparency of company and beneficial ownership registers, published as free of charge and open data, across the EU.
In 2019, Transparency International had asked the Financial Action Task Force (FATF) – an intergovernmental body and anti-money laundering watchdog – to fix the global standards on beneficial ownership transparency. It had specifically called for public, central registers as a key measure to end the decades-long abuse of anonymous companies around the world.
In October 2021, FATF finally agreed to propose much-needed amendments to the global standards. In the FATF Plenary in March 2022, the FATF agreed on tougher global beneficial ownership rules to stop criminals from hiding their illicit activities and dirty money behind secret corporate structures.
On March 4, 2022, the FATF adopted amendments to Recommendation 24 and its Interpretive Note which require countries to prevent the misuse of legal persons for money laundering or terrorist financing and to ensure that there is adequate, accurate and up-to-date information on the beneficial ownership and control of legal persons.
The FATF expects all countries to take concrete steps to implement these new standards promptly, and to determine the appropriate sequence and timeframe for implementation at national level.
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