Has a compromise been achieved?

A single solution was found in the issue of disclosing data from the registers of the owners of companies, as well as beneficial owners of trusts. The European Parliament and the member states of the European Union came to an important compromise. According to the main arrangements and agreements, the registries of beneficial owners in the territories of states will still be maintained. But access to the data will be provided only to local authorities, as well as representatives of foreign authorities (only provided that an appropriate information exchange agreement has been concluded between specific countries).

Perhaps you have already heard about the "Fourth EU Directive". It is also called "Anti-Laundering". It is the fundamental document in the implementation of the new approach of the EU.

Difficult search for a solution

The problem related to the decision on the registries of beneficial owners was widely discussed among specialists. Discussions on this issue were difficult and complex: the innovation/amendment collected approximately equal number of both "for" and "against" arguments. Initially, the discussion participants followed the opinion that only registries which contain information about the beneficial owners of the companies should be introduced to public access. Later representatives of the European Parliament made an attempt to insist on the new rules to be applied to the beneficial owners of other forms (private funds, trusts). Proceeding from this, it was planned to completely exclude confidentiality guarantees for company owners. Naturally, such a trend caused strong confrontation on the part of business representatives, who fully used all lobbying levers and were able to change the outcome of disputes.

The strongest argument of the owners was concern, caused by the inability to obtain confidentiality guarantees. This, in turn, would open registries not only for state authorities. Data would also be available to criminals who could easily carry out another raider seizure or other hostile action against the company. Attention was also paid to the fact that trusts and funds are used by businessmen not only for the purposes of tax planning. Such forms are often the best instruments to protect the interests of family members of the owner.

As a result, the optimal solution was found. Governments of the countries were given the opportunity to receive information on the beneficial owners of trusts and companies, and business representatives upheld guarantees to ensure the necessary level of confidentiality for their business structures.

By 2017, it is planned to fully implement the "anti-laundering directive" and, in accordance with its provisions, to compile the registers of beneficial owners of companies and trusts.

What in the end?

Sensitivity of the offshore business to the question of the registers of the owners of companies is understandable. Moreover, even earlier representatives of some countries, known as offshore jurisdictions, have already expressed their intention to further regulate the issue with registers on the basis of models adopted in high-tax jurisdictions. Thus, it is possible to assume that the practice of using registers will still be brought into line with the new "anti-laundering" directive.

Well, innovations do not seem to have much impact on the state of affairs of offshore companies in Europe. The fact is that the data on the beneficial owner is open to the authorities of jurisdiction even nowadays. Using discretionary or special trust can rid the owner of having to provide information about himself.