Leaders in the Virgin Islands and London will soon discuss the territory’s plan to limit public access to the new beneficial-ownership register set to launch here early next year, Governor Daniel Pruce has signalled.
During a Tuesday press conference, however, the governor stopped short of confirming Premier Natalio “Sowande” Wheatley’s recent claim that the United Kingdom is warming to the VI’s position on the matter.
Mr. Pruce added that the topic had been discussed in London this summer, but he was not involved in the talks: Though he was in Britain at the time, he said, he was receiving medical treatment for a shoulder injury.
Shifting goalposts
Under UK pressure, the VI government grudgingly agreed in September 2020 to sign on to a plan for the overseas territories and crown dependencies each to implement a fully public beneficial-ownership register by the end of 2023.
The VI government then began laying the groundwork for the move, but in November 2022 the European Union Court of Justice issued a ruling that threw the plan into question.
In a case involving Luxembourg’s then-public registry, the court ruled that a key provision of the EU’s own anti-money-laundering directive — which required beneficial ownership information to be available to the public — was invalid. After that, European countries including Luxembourg, Austria and the Netherlands restricted access to their previously public registers.
The VI subsequently announced a plan to follow suit by launching a register accessible only to people deemed to have a “legitimate interest” in viewing it.
UK position?
Since then, the UK has not taken a clear public position on the VI’s plan, though it appeared to agree in principle in a joint communiqué issued by the UK and the OTs after their Joint Ministerial Council meetings last November in London.
“We commit to improving our corporate transparency by completing plans to implement accessible registers of beneficial ownership, with some territories implementing registers with legitimate-interest access and others implementing fully publicly accessible registers,” the communiqué stated. “We note the UK government’s ambition that Publicly Accessible Registers of Beneficial Ownership (PARBOs) become a global norm and its expectation that overseas territories and crown dependencies implement full PARBOs.”
But despite noting this UK goal, the communiqué also noted commitments by the VI, Anguilla, Bermuda, the Cayman Islands and the Turks and Caicos Islands to implement “Legitimate Interest Access Registers of Beneficial Ownership” with maximum possible access and transparency while also protecting the right to privacy in line with their constitutions.
Delayed launch
Since then, the VI’s original plan to launch its register this June was delayed, but the government released a draft policy outlining how it will strictly limit access to the register — including by charging a $75 fee per company and requiring searchers to take extensive steps to demonstrate “legitimate interest.”
Transparency campaigners and UK members of parliament publicly attacked that plan as too restrictive — and raised alarms about the implementation delays.
But the UK government has stayed tight-lipped on the matter.
‘Concerns’
On July 3, UK Overseas Territories Minister Stephen Doughty acknowledged that the VI had unveiled a draft access policy but added that he “remained concerned about the system’s limitations.”
In statements to the House of Commons that month, Mr. Doughty gave no indication that the UK’s position on wider transparency had changed and said he was sending UK Anti-Corruption Champion Baroness Margaret Hodge to the territory on a “fact-finding” mission.
Later that month, Mr. Wheatley acknowledged UK concerns about the delays in launching the register, but he said London had warmed to the territory’s position on access.
On Tuesday, however, the governor said London’s stance had not changed since Mr. Doughty’s July statements.
“I think those two public statements probably remain up to date and serve as a prelude to Baroness Hodge’s visit,” the governor said.
Responding to Mr. Pruce’s remarks this week, the premier said Tuesday that the two sides were coming closer together on the issue, and he continued to insist that London has changed tack.
“I am pleased that the UK government and Baroness Hodge have accepted that registers should only be accessed on a legitimate-interest basis,” he told the Beacon. “This is a positive step that brings us closer in alignment.”
Lady Hodge, a long-time critic of financial transparency in the territory, is expected to visit the VI in late September.
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