David Cameron yesterday backed the launch of a new central register to reveal who owns and controls the nation’s companies, but went further by saying it will be open to “everyone.”
The prime minister’s announcement means that details of the person or persons behind every company registered in Britain will be made public, in a bid to lift their “cloak of secrecy.”
Although listed companies are expected to be exempt, the government estimates that around 2.5m companies and partnerships will have their owners’ details uploaded to the register.
But the PM emphasised that the central database would not only pinpoint who owns companies legally, but also “who really benefits financially from their existence.”
He said: “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.”
The plan to set up a register of beneficial owners of companies was floated at the G8 summit earlier this year as an anti-evasion measure, but the issue of whether it should be viewable to more than just the taxman and Companies House was put out to consultation.
Mr Cameron believes there are “many wider benefits” to making the information - of “who owns what and where money is really flowing” - available to the public, such as it being easier to police.
“The more eyes that look at this information, the more accurate it will be,” said the PM. “It’s better for businesses here – who will be able to better identify who really owns the companies they’re trading with.”
Enterprise groups are mainly supportive, but the UK’s employers’ organisation sounds concerned that Mr Cameron is the only leader of any country to vow to offer a public register revealing firms’ beneficial owners.
The CBI said: “The real prize is the ability to track ownership information around the world. Now that the UK has chosen to make this a public register, ensuring that others follow our lead will be critical to its success and to maintaining a level playing field.”
Other concerns have been raised by the Institute of Chartered Accountants in England & Wales, which told the Financial Times of legitimate reasons for keeping company ownership details confidential.
But campaign groups, such as Tax Justice Network, praised Mr Cameron’s move, saying the central register of companies will go a long way towards reducing, corruption, money laundering and tax evasion.
Editorial image courtesy of The Prime Minster's Office