EU Rules Out Public Trust Beneficiary Registry
by Jason Gorringe, Lowtax.net, London
21 January, 2015
The EU has released its Fourth Money Laundering Directive, which includes provisions requiring states to maintain information on the beneficial ownership of certain trusts and companies.
According to the Society of Trust and Estate Practitioners (STEP), the Directive includes a requirement that states maintain a public registry on the beneficial ownership of companies, but also clarifies that such information will only need to be retained for taxable trusts. The information relating to trusts, STEP said, will not be publicly available, being open only to those that have a "legitimate interest" in accessing the data.
STEP had argued against a public register of trust beneficiaries, arguing that trusts are often used to protect vulnerable individuals.
Welcoming the decision, STEP Deputy Chief Executive George Hodgson said: "STEP fully supports the principle that we need effective measures to prevent money laundering and is pleased that the EU has agreed a pragmatic way forward in this area."
"An important point is that trusts will remain confidential and not on a public register. It is clear that many of those originally arguing for trust beneficiaries to be publicly listed had not appreciated the role trusts widely play in protecting vulnerable beneficiaries."
"The development of public registers for companies and foundations will produce some significant challenges, however, and STEP looks forward to working with the [European] Commission and others to help overcome these challenges."
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