Guernsey: Triumph For Transparency Or Snooper's Charter?

Last Updated: 6 July 2015
Article by Sean Cheong and Ian Kirk

In March of last year, the UK Parliament enacted the Small Business, Employment Act 2015 which contains amendments to the Companies Act 2006. These amendments, once in force, will require companies registered in the UK to maintain registers of individuals who have significant control over a company and will also provide for the introduction of a publicly accessible central register from 2016.

The Department of Business and Skills in the UK published its 65 page consultation paper on 19 June. The focus will be on the creation of a workable register of people with significant control ("PSC Register"). Baroness Neville-Rolfe in the foreword said this:

"...the development of the [PSC Register] has been driven by one question: 'how can we keep this simple?' The final scheme strikes a balance between information that can be supplied quickly and without undue burden but that is still enlightening and meaningful."

She explains "Trust is one of the most important commodities in the investment market. If you do not know who is behind a company, how can you be sure who you are doing business with, what motivates them and what they might be trying to achieve?"

"Obscure company ownership structures can facilitate tax evasion, money laundering and even terrorist financing. Clamping down on these practices is an imperative of this Government."

Indeed. The PSC Register is the product of the pronouncements at the G8 meeting in 2013. It's about financial crime and ensuring that UK companies are not instrumental in the activities of criminals. Will a PSC Register succeed in balancing the interests of businesses, investors and the public?

Guernsey's Policy Council recently published its own consultation paper entitled "Transparency of Beneficial Ownership of Companies in Guernsey" inviting comments no later than close of business on 10 July 2015.


Towards the back end of last year, Collas Crill consultant, Ian Kirk, was invited to give an offshore perspective at a City Debate hosted by Mishcon de Reya on the issue. The panel included Jonathan Djanogly (Conservative MP for Huntingdon) and representatives of charities promoting the concept of a public registry.

At the start of the debate the audience was asked whether a public registry was a good idea. The vote was 44% in favour of and 56% against the idea.

At the outset, Mr Djanogly's view was clear that a public registry was a bad idea. In his opinion, it would have no discernible impact on fighting crime and would adversely impact on the right of privacy in corporate affairs in the UK. He thought it could well deter foreign investment in the UK by those who wanted to keep their shareholdings private.

Unfortunately Mr Djanogly was called to the House of Commons for a "three line whip", leaving our esteemed representative of the offshore community to make Mr Djanogly's case! A second vote was taken at the conclusion of the event; 77% against a public register and 23% for (a swing of 21%).


Public opinion will always be divided on this prickly subject. The over-simplistic view in support of a register is that those with nothing to hide have no fear of a public register. Where have we heard that one before?

It is tempting to assume that anyone who objects to such a sensible measure must surely be assisting those with criminal intent. Arms dealers and tin pot dictators should have nowhere to hide, onshore or offshore.

Will a register deter criminals? Will it also compromise the privacy of (law-abiding) private individuals? Some would claim that the loss of privacy to a few is a small price to pay to keep the bad people out.

As Mr Djanogly pointed out, such a register may be totally ineffective as a crime fighting tool. Criminals will generally find a way around the requirements. We may simply end up penalising the rest for no real benefit. We risk creating an environment which is hostile to those with legitimate privacy concerns.

As has often been said "there is a difference between the public interest and what interests the public." This will surely provide fresh fodder to journalists on the tabloids, well known for their exercise of restraint when targeting celebrities.


For better or worse, the UK government has adopted this position notwithstanding there are other mechanisms which can be put in place to ensure that details of beneficial ownership are accessible to the relevant authorities such as the police, customs and regulators which should not unduly compromise the privacy of those carrying on lawful activities.


It may come as a surprise to some (UK politicians included) that the legal and regulatory requirements of Guernsey currently encompass:

  • the licensing of corporate and fiduciary service providers who provide company incorporation and management services;
  • a rigorous anti money laundering and client due diligence framework imposing obligations on service providers to obtain and retain beneficial ownership details;
  • a prohibition in the Company law against the issue of bearer shares;
  • the requirement, save in exceptional cases, for a local resident agent to be appointed to keep records of beneficial ownership;
  • robust enforcement against those who are non-compliant.

These measures go far beyond those currently in place in the UK and could serve as a possible model to be adopted in UK.

In the meantime we will follow the developments of the PSC Register. Time will tell if the stated aims of transparency are truly achievable and at what cost.


The idea of a public registry appears superficially attractive but is, in our view, unworkable; the information on the Registry is likely to be inaccurate or become inaccurate (unless updated regularly) and the possibility of misuse of any accurate information is a real and worrying issue.

The way to tackle criminal activity is to ensure that there is robust enforcement by the appropriate authorities, rather than making beneficial ownership information public.

The existing regime in Guernsey works well and balances clients' legitimate needs for confidentiality whilst providing access to agencies to pursue those involved in criminal activity.

Guernsey should, in conjunction with other international financial centres, explain and robustly defend what is an established and better alternative approach to countering financial crime.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions