An amendment has been passed in the UK Parliament calling for the creation of a register to identify the owners of companies based in the British territories in the Caribbean, in an effort to clamp down on money laundering and tax evasion.
The Cayman Islands, the British Virgin Islands and the Turks and Caicos Islands have until December 31, 2020 to create public property registers, in a move long-called for by NGOs and tax justice campaigners.
This will “change the game” in “our tax havens,” said Labor opposition MP Margaret Hodge, who proposed the amendment to the money laundering bill. “With open registers we will then know who owns what and where, and we will be able to see where the money flows, and then we will better equipped to root out dirty money and deal with the issues that arise from that” she added.
News of the register has been met with consternation in the affected territories. “We vehemently reject the idea that our elected governments can be supplanted by the British Parliament,” said the government of the British Virgin Islands in a statement on Tuesday, in a statement.
However, Transparency International welcomed the adoption of the amendment as an “extremely important moment in the fight against corruption”. These territories “have long been the Achilles heel of our defenses against dirty money,” said an NGO official, Duncan Hames. These “overseas territories are relatively small but very secret financial centres, responsible for a little over 4% of financial services offered to non-residents,” said the NGO Tax Justice Network.
However, the fight is far from over. The amendment does not apply to trusts and does not apply to dependencies in the United Kingdom such as Jersey, Guernsey and Man.
“It’s a necessary but not sufficient measure,” acknowledged Margaret Hodge. “Today’s vote is good news for the protection of human rights and democracy around the world, and bad news for fraudsters, money launderers and kleptocrats. It is now time to address the other bastions of financial secrecy,” she said.