Establish a Register of Beneficial Ownership (IE0048)

To hold information on the beneficial ownership of companies incorporated in Ireland. To hold information on the beneficial ownership of companies incorporated in Ireland. Objective: To strengthen transparency over who ultimately owns and controls companies and other legal entities, to effectively detect, disrupt and prevent money laundering and terrorist financing. Status quo: Ireland is committed to implementing the Financial Action Task Force (FATF) Recommendations on transparency and beneficial ownership. Ireland is transposing the EU 4th Anti-Money Laundering Directive which requires Member States to create registers of beneficial ownership information of companies (article 30). The EU 4th Anti-Money Laundering Directive is currently being amended to greater enhance counter terrorist financing and transparency provisions which may have an impact on beneficial ownership registers. Ambition: We will work to ensure that beneficial ownership information of companies can be used effectively to detect, disrupt and prevent money laundering and terrorist financing. We will work to ensure accurate and timely beneficial ownership information of companies is collected and available to those with a legitimate interest. This requires mechanisms to ensure law enforcement and other competent authorities, including tax authorities, have full and effective access to accurate and up to date information. Lead implementing organisations: Department of Finance Timeline: To be decided at EU level.
Commitment 15: Establish a Register of Beneficial Ownership OGP values Anti-Corruption. New or ongoing commitment: New. Lead implementation organisations: Department of Finance. Other actors involved – government: Department of Justice and Equality; Department of Jobs, Enterprise and Innovation; Companies Registration Office; Central Bank of Ireland. Verifiable and measurable milestones to fulfil the commitment New or ongoing Start date End date Establish central registers of beneficial ownership information of companies, put in place effective arrangements for reporting, sharing and exchanging this information and consider the feasibility of making it public. New December 2016 To be decided at EU level.

15. Establish a Register of Beneficial Ownership

[Ed Note: Commitment renumbered to 15 in Year 1 report.]

Commitment Text:

Objective: To strengthen transparency over who ultimately owns and controls companies and other legal entities, to effectively detect, disrupt and prevent money laundering and terrorist financing.

Status quo: Ireland is committed to implementing the Financial Action Task Force (FATF) Recommendations on transparency and beneficial ownership. Ireland is transposing the EU 4th Anti-Money Laundering Directive which requires Member States to create registers of beneficial ownership information of companies (article 30). The EU 4th Anti-Money Laundering Directive is currently being amended to greater enhance counter terrorist financing and transparency provisions which may have an impact on beneficial ownership registers.

Ambition: We will work to ensure that beneficial ownership information of companies can be used effectively to detect, disrupt and prevent money laundering and terrorist financing. We will work to ensure accurate and timely beneficial ownership information of companies is collected and available to those with a legitimate interest. This requires mechanisms to ensure law enforcement and other competent authorities, including tax authorities, have full and effective access to accurate and up to date information.

Milestone

15.1. Establish central registers of beneficial ownership information of companies, put in place effective arrangements for reporting, sharing and exchanging this information and consider the feasibility of making it public.

Responsible institution: Department of Finance

Supporting Institutions: Department of Justice and Equality; Department of Jobs, Enterprise and Innovation; Companies Registration Office; Central Bank of Ireland

Start date: December 2016

End date: To be decided at EU level

Context and Objectives

This commitment seeks to bring Ireland into compliance with Article 30 of the 4^th EU Anti-Money Laundering Directive of 2015, which requires member states to create a register of beneficial ownership information of companies.[Note: This legislation can be found here, with Article 30 starting on L141/96: http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=OJ:JOL_2015_141_R_0003&from=ES.] It also considers the feasibility of making the register public. A beneficial owner refers to ‘a person who enjoys the benefits of ownership even though title to some form of property is in another name. It also means any individual or group of individuals who, either directly or indirectly, has the power to vote or influence the transaction decisions regarding a specific security, such as shares in a company.’[Note: Quote taken from: https://www.investopedia.com/terms/b/beneficialowner.asp.]

According to the action plan, the central register will ‘report, share, and exchange’ information on beneficial ownership. The commitment states that the Department of Finance will ‘consider the feasibility’ of making the information on the registers public. While this consideration makes the commitment technically relevant to the OGP value of access to information, it should be noted that this relevance is conditional on whether the information is ultimately made available to the public. Therefore, the OGP value relevance is considered unclear, although this may change in the End of Term report if the information is ultimately made publicly available. The commitment includes a verifiable deliverable in the form of the beneficial ownership register to be compliant with EU standards, but it is unclear what information will be included in the register. Also, the end date is decided at the EU level, making the schedule for the implementation progress difficult to track. Therefore, the specificity is low.

If created, the register could consolidate information on beneficial ownership in Ireland. However, as written, the commitment does not guarantee public access to the register, and it might only be available to public bodies such as the Revenue Commissioner and the Guards, to prevent money laundering and potential financing of terrorist organisations. The CSO Social Justice Ireland, which welcomed the move towards developing a register, expressed this concern, commenting that the government should make the register fully open to the public.[Note: See their comments on Commitment 15 here: https://consult.ogpireland.ie/en/submission/CVQ-258 ] At the time of writing, the EU favoured a harmonised approach across member states with regard to making beneficial ownership registers available to the public.[Note: See: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A52016PC0450. ] In its progress report, Ireland is waiting for the EU to decide on this and then consider more fully making the information housed in the register public. As written, however, the commitment’s potential impact is minor.

Completion

The completion level is substantial, but it is behind schedule. Since November 2016, the government has obliged companies to collect information on their beneficial ownership and to file this information with the Department of Finance’s central beneficial ownership register. The government states in its progress report that the register is expected to be fully in place and populated. The information will be found in the Companies Registration Office (CRO) by Q4 2017, for which a website has been set up.[Note: The CRO website can be found here: https://www.cro.ie/Registration/Beneficial-Ownership. ] However, KPMG stated in July 2017 that this commitment has been delayed because, while the EU established an earlier deadline of June 2017, ‘the timing of the obligation to disclose beneficial ownership information to a central register has now been extended to autumn 2017.’[Note: See the KPMG report here: https://home.kpmg.com/ie/en/home/insights/2017/07/ireland-delays-implementation-of-central-register-of-beneficial-owners.html.] Thus far, the government has not contacted interested CSOs during the implementation of the policy.

Next Steps

If the commitment is not completed by the second year of the action plan, it should be carried forward to the next plan. Moving forward, the IRM researcher recommends amending the commitment to make the register fully available to the public. While Ireland is currently waiting for the EU to decide if it will stipulate require that beneficial ownership registers to be made public, the United Kingdom has already done so.[Note: On the UK register, see: https://www.gov.uk/government/organisations/companies-house. An excellent comparative analysis of beneficial ownership policies across several states (including an openness score associated with the registers, which can scale from 1-100) is also found on the OpenCorporates webpage at: https://opencorporates.com/registers. Ireland has an openness score of 45, while the UK scores 90, which can be explained given the public’s access to UK data. ] Therefore, there is a certain amount of autonomy that can be exercised by any one member state in implementing this policy. The IRM researcher recommends that the government proactively decide to formulate and implement a policy to make the information in this register fully public.

For commitment details, see https://www.opengovpartnership.org/wp-content/uploads/2001/01/Ireland_End-Term_...