The Cayman Islands intends to introduce a public beneficial ownership register.
The Government of the British Overseas Territory announced that it would introduce open access to information on true owners of companies at the same time as countries in the European Union.
The news marks a policy shift for Bermuda’s offshore financial-services rival, which had previously shared the stance of the Bermuda Government — that it would make beneficial ownership information public only when it became an international standard.
Alden McLaughlin, Cayman’s Premier, said the introduction of the UK’s public beneficial ownership register, the EU 5th Anti-Money Laundering Directive and similar actions by other jurisdictions represented a shift in the global standard and the practices used to combat illicit activity.
Corresponding legislation is expected to be introduced in 2022, the Cayman Compass reported. Cayman’s commitment is similar to that made by the British Crown Dependencies earlier this year.
Britain has been pressuring its territories to adopt public beneficial ownership registers since David Cameron, the former British Prime Minister, proposed the idea in 2012 in an effort to clamp down on tax evasion.
Bermuda has opposed the idea ever since, on the grounds that if other countries are not required to do the same, it would cause the island economic damage.
Bermuda has maintained a beneficial ownership register, though not accessible to the public, for more than 70 years and has tax information exchange agreements with many countries.
Britain will issue an Order in Council in December 2020, requiring OTs to establish public registers. The Bermuda Government has argued that the order would breach the Bermuda Constitution.
On a visit to Bermuda in April this year, Lord Tariq Ahmad, Britain’s Foreign Office Minister for the Overseas Territories, said the UK was pushing for public registers to become an international standard by the 2023, the same deadline being imposed on Bermuda.
Mr McLaughlin added: “I am proud that the Cayman Islands has worked so well with law enforcement and tax authorities the world over, and that the level of transparency of our regime has been recognised by key international bodies and other governments.
“The timeline we have announced today recognises the work necessary to create a register that is sufficiently robust, capable of suitable levels of interoperability and that will avoid the redesigns that the UK now has to undertake.”
Cayman Finance, a body representing international business, backed the Government’s move.
“Now that the UK and EU are establishing an emerging global standard for ownership registers to be public, the Cayman Islands financial services industry will work closely with the Cayman Islands Government to ensure we meet that standard also,” Cayman Finance stated.
A Bermuda government spokeswoman said last night: “Bermuda has strong and sophisticated laws that protect against money laundering and terrorist financing. Bermuda’s position on the adoption of a public register of beneficial ownership has been consistent over several years.
“We are committed to implementing any properly adopted international standard for public registers and will continue to work with bodies like the Organisation for Economic Co-operation & Development and the Financial Action Task Force to combat money laundering.”