Lawyer finds loophole in register of companies
A lawyer claims there is a way for a ‘beneficial owner’ of a business to head off the “unwanted scrutiny” that the government’s central register of companies might bring them.
James Austen of legal advisory Charles Russell Speechlys says “help is at hand” if his clients wish to avoid the public register, being built to name those with ‘significant control’ of a company.
His comments, made on the advisory’s website, relate to the fact that from January 2016, UK companies must obtain and hold a register of all ‘persons with significant control’ (PSCs).
Even more “controversial”, wrote Austen, is that by April 2016 such companies will be required to register the personal details of PSCs for inclusion in the public register.
But he stated: “Notwithstanding the new UK rules, it is still possible to have the benefits of corporate structures without the obligation to disclose information about beneficial ownership on a publicly available register.”
Although the lawyer also wrote that these benefits were “depending on the circumstances”, he said that the companies able to achieve them could be tax resident in either the UK or overseas.
Elsewhere in his online post, Austen characterises the David Cameron-backed register as a ‘reaction’ to concerns about tax evasion, money laundering and the funding of terrorism.
“For the overwhelming majority of individuals affected by these new rules,” says the post, “the Government’s concerns about tax evasion, money laundering and terrorist financing will seem misplaced.”
It adds: “In an age of notorious press intrusion and prurient public interest in high net worth individuals, the requirement for… [corporate] structures will not diminish. Yet the UK’s new transparency rules apparently cut across these needs.”
No details of the way a PSC can bypass the register are provided by the post’s author, who insisted to the Financial Times at the weekend that the arrangement he knows of was “not at all contrived”.
