Controlling shareholders of UK companies will have their information made readily available to the public through a government-maintained central registry, Prime Minister David Cameron announced this week.
Speaking at the Open Government Partnership earlier this week, the UK prime minister says his government is ‘committed’ to producing a record of all those with beneficial ownership of companies in the country. The proposed register is in line with plans laid out at the Lough Erne G8 conference in June and further details suggested by the Department for Business, Innovation & Skills in July in a discussion paper entitled ‘Transparency and trust’.
The registry will list information on individuals who hold at least 25 percent of a UK company’s shares or voting rights, or who might otherwise control the way in which it is run. In the interests of transparency, the list will be entirely accessible to the public.
The way in which the government will hold information, however, remains to be decided, though an official response to a current discussion paper – set to be published in early 2014 – will address this. It is expected that government guidelines will follow existing disclosure requirements, where companies are responsible for keeping the names and addresses of their beneficial owners along with the details of their interests in the firm. Companies House would then have to pass this information on to the public on request.
Limited exemptions from public disclosure will be permitted – for example, in cases where it is necessary to protect individuals whose safety might be put at risk. ‘We need to know who really owns and controls our companies,’ says Cameron. ‘Not just who owns them legally, but who really benefits financially from their existence.
‘This summer at the G8 we committed to do just that: to establish a central register of company beneficial ownership. And today I’m delighted to announce that not only is that register going to go ahead, but that it’s also going to be open to the public.’
The UK’s business secretary, Vince Cable, shares his leader’s sentiments. ‘A stronger economy depends on investors, employees and the wider public having trust and confidence in companies and those that are running them,’ he suggests.
He goes on to say that in order to improve Britain’s status as a valuable investment marketplace, his party is dedicated to promoting ‘openness’.
‘People have a right to know who controls UK companies, and greater openness will help tackle tax evasion, money laundering and other crimes,’ Cameron adds. ‘The vast majority of companies and directors in the UK contribute productively to the economy, abide by the rules and make an enormous contribution to society. But an errant few operate in the shadows, creating ownership structures that serve to deceive. We’re now shining a light on who really owns and controls companies in the UK and proudly leading the world in this initiative.’
The government is also set to address other proposals from ‘Transparency and trust’, including the abolition of bearer shares, an investigation into the use of corporate directors, and to address situations where a ‘front’ director is registered, despite real control of the company being concealed elsewhere.
