David Cameron announced this morning that he intends to launch an open public registry on company information in the UK following a consultation by BIS.
Clearly the same pattern is emerging which was prevalent before the G8, and the NGO led initiative calling for 'Open Book' transparency in private company arrangements has won the day.
It is not yet clear what will be on such a register but unless this is adopted by the G20, I would confidently predict that Mr Cameron is likely to have lots of friends in the AID world and insufficient food on the table at home.
Relevant extracts from the speech follow:
But this transparency needs to extend beyond the public sector – and into the private sector too.
We need to know who really owns and controls our companies.
Not just who owns them legally, but who really benefits financially from their existence.
For too long a small minority have hidden their business dealings behind a complicated web of shell companies…
…and this cloak of secrecy has fuelled all manners of questionable practice - and downright illegality.
Illegality that is bad for the developing world – as corrupt regimes stash their money abroad under different identities.
And illegality that is bad for Britain’s economy too – as people evade their taxes through untraceable trails of paperwork.
Not only is this hugely unfair to the millions of hardworking people in Britain who pay their tax…
… it’s also bad for business.
To keep corporate taxes low, you’ve got to keep corporate taxes coming in.
As I’ve put it, no tax base – no low tax case.
So that’s why we need to shine a spotlight on who owns what and where money is really flowing.
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.
Some people will question whether it’s right to make this register public.
Surely we could get the same effect just by compiling the information and using it within government?
Now, of course we in government will use this data to pursue those who break the rules. And we’re going to do it relentlessly. But there are so many wider benefits to making this information available to everyone.
It’s better for businesses here – who will be able to better identify who really owns the companies they’re trading with.
It’s better for developing countries – who will have easy access to all this data, without submitting endless requests for each line of enquiry.
And it’s better for us all to have an open system which everyone has access to – the more eyes that look at this information, the more accurate it will be.
This is a complete world first on transparency and I’m proud Britain is leading the way.
And today I call on the rest of the world to join us in this journey.
Together we can make an even bigger difference.
And together we can close the door on these shadowy, corrupt, illegal practices once and for all.
Supporting transparency groups
Making the argument. Words into deeds. Practicing what we preach. Things that we’ve got to do.
No evidence is cited for the supposed illegality referenced and if the PM has relied on NGO 'research'; usually nothing more that speculative campaigning propaganda, then he has been badly advised.
Governments knowing who owns what, is one thing, and by and large to be supported, depending on the validity and integrity of the government concerned; but campaigning busybodies living off the public purse and diverted donations intended to help the poor and needy is quite another.
The IFC Forum have articulated very clearly in their submission to the BIS consultation on Trust and Transparency the legitimate reasons for preserving privacy and what I call compliant confidentiality.
Protecting business interests, trade secrets, safeguarding personnel from fringe, sometimes violent campaigning groups, from corrupt political elites and from criminals are all real and weighty concerns. It is telling that the NGO community are happy to subject those who have worked hard and done the right thing to a much greater degree of scrutiny than almost any other constituency in society.
There is little difference from opening up the private company arrangements of business owners to the public glare of NGOs, journalists, cyber criminals and the assorted flotsam and jetsam of the worldwide web, than for ordinary bank accounts. If the logic holds good do we not need to know the balance publicly of all personal bank accounts so that all can be sure we came by our cash by legitimate means?
We have nothing to hide in Jersey and we have been active supporters of government to government information exchange. However, the voyeuristic tendencies of politically correct elites should not be indulged and indeed will not be by the vast majority of countries, leaving the UK out on an uncompetitive, uncomfortable and potentially impoverished limb.
As the PM points out this measure is targeted at the few who cheat. Why then should the honest majority suffer the additional costs and unwarranted intrusion.
I sincerely hope the Channel Islands governments will support compliant confidentiality and basic human rights in this area, avoiding the slide into public vigilante led financial surveillance, and avoid the temptation to follow PM Cameron's crowd pleasing initiative.
If this becomes a G20 initiative adopted by all major countries and fora then that would be a different matter. Until it is, we should sit this one out.