Should There Be a Mandatory Register of Beneficial Ownership of Corporate Structures in Every Country

The Cayman Islands approaches this question from the perspective of a jurisdiction with its own brand new mandatory beneficial ownership regime.

Legislation, which came into force on 1 July 2017, requires certain Cayman Islands’ companies and limited liability companies to identify their individual beneficial owners and relevant legal entities, maintain beneficial ownership registers at their registered offices and for the information on the registers to be stored in encrypted form on a secure offline search platform established by the Minister of Financial Services as the competent authority. The platform is ‘airgapped’, or in other words not connected to the internet or any other network, for security purposes.

The purpose of the legislation is to expedite access to beneficial ownership information in response to proper and lawful requests from specified law enforcement agencies and not to materially expand the scope of such requests or the required responses. During negotiations with the UK in the run-up to the introduction of the new beneficial ownership regime, the Cayman Islands’ government successfully maintained that beneficial ownership information should be non-public until such time as public registers became the accepted international standard. The platform is searchable only by the competent authority and is not publicly accessible. Partnerships, trusts and foreign companies are out of scope.

 

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