Thanks to the decades of secrecy provided by anonymous company ownership, unscrupulous individuals from across the world have found safe haven in the EU – circumventing sanctions, evading accountability and committing further crimes with impunity. It is clear that EU authorities alone cannot uncover all the abuses and keep up with criminals’ evolving methods. Many schemes would go undetected if not for the dedicated work of investigative journalists and activists around the world.
Independent actors tracking illicit flows of money should not have to jump through hoops to find out who’s really behind suspicious companies. The EU acknowledged this in 2015 and then again in 2018 by establishing and widening stakeholder access to beneficial ownership information of companies.
The impact of these measures was just becoming visible when CJEU invalidated public access provisions of the 5th EU AMLD last November. In the context of anti-money laundering, the court failed to see the added value in expanding access to information on companies’ real owners to everyone without the need for them to prove legitimate interest. And while unfortunate, this does not mean that we need to give up on public registers in the EU: Considering the potential of beneficial ownership information in a variety of other sectors beyond anti-money laundering, countries should open up this information to the public through alternative frameworks – as Estonia and Latvia have done.
In the meantime, it is critical to ensure that the 6th EU AMLD complies with the court ruling and at the same time upholds corporate transparency. In March, the European Parliament made their own progressive amendments to the draft legislation. Little is known on the specific positions of the Council, so we at Transparency International have called on them to match the Parliament’s ambition. The European Commission has a role to play in ensuring that independent actors can fulfil their watchdog role as recognised by the court, too.
Anything that falls short of this will open doors to inconsistent application of rules across member states, create unnecessarily cumbersome procedures and enable more infractions.
