This summer, the UK Department for Business, Energy and Industrial Strategy (BEIS) authored a draft bill to create a register of beneficial owners of overseas entities that own land in the UK.
As part of our work advocating for more open company data, OpenCorporates responded to the public consultation on the legislation. A brief summary of our response is below, and you can read the full version here.
We applaud the government’s decision to:
- Align the register proposed under the Draft Bill (the Property Register) with the PSC Register, especially making the data public, free to access and published as open data.
- Impose criminal sanctions for contraventions of the Draft Bill.
- Require registered entities to provide their company registration number, which will assist in verifying the existence and details of that entity.
- Make penalties available when Companies House flags an inconsistency and the overseas entity does not provide the required documents within 14 days.
In order for the register to be truly effective, however, we believe the following are essential:
- The register must include the beneficial owners of all entities able to own property in the UK, including trusts and partnerships. Without this, those currently using the London property market for money laundering will use the lengthy transition period to avoid disclosure by creating new entities to obscure the trail.
- Entities that do not appear on a public register (for example trusts and partnerships) should be required to register for LEI, which creates a globally unique ID and validates the underlying data.
- Entities must only be exempt from disclosing beneficial ownership in the UK when declaring elsewhere if that register is of absolute equivalence to UK register, i.e.
- It contains the same level of detail
- It is publicly accessible and free
- It is available as open data
- Finally, the Overseas Entities register should learn from the implementation of the PSC register, by reducing the ownership threshold to 5%.