Publicly available ultimate beneficial ownership
registers appear to have been restricted to 'taxable'
trusts in the EU's Fourth Money Laundering
The EU's Fourth Money Laundering Directive
("the Directive") is now available
together with its accompanying regulations.
Trilogue negotiations involving the European Parliament, the
Council and the European Commission in the last quarter of 2014
determined the final shape of the Directive.
One of the key outstanding discussions from those negotiations,
concerned the requirement for member states to maintain publicly
available ultimate beneficial ownership registers, for both
corporate entities and trusts.
The proposed requirement for all trusts to be registered was the
most contentious proposal as far as legal bodies, practitioners and
settlors were concerned. In common law jurisdictions, trusts are
often used for structuring family wealth and to succession plan and
therefore a public central register would have unfortunate and
possibly serious consequences for their privacy.
It was therefore pleasing that the mandatory register of trusts
only applies to 'taxable' trusts and will not be made
There was less good news for companies and foundations, however,
where the register will be publicly available to those who possess
a 'legitimate interest.'
The definitions of both 'taxable' and 'legitimate
interest' are still to be determined and have been kept
deliberately wide whilst the Directive goes through the translation
phase amongst the member states. It is thought that
'taxable' trusts, in the UK, will mean those trusts that
file returns with HMRC. Those with a 'legitimate interest'
will almost certainly be NGOs and financial institutions with
anti-money laundering filing requirements, but beyond that it is
unclear. It is likely that the definitions will first need to be
tested before clarity is achieved.
Click here to see what the Chief Minister's
Department has recently released, summarising the Jersey
Government's understanding of the Directive.
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.
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Confidentiality of corporate documents and information is one of
the key attractions of incorporating a company in the BVI. A
company search of the BVI Registrar of Corporate Affairs will only
disclose certain information and documents.
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