Implement a register of beneficial interests
Globally, there are serious concerns about the lack of transparency in the ultimate ownership of companies, trusts, and other organisations. This lack of transparency can make it hard to determine, for instance, who is benefiting when public funds go to private organisations, whether organisations are paying the correct amount of tax, and whether money-laundering or other forms of corruption are occurring.
Increasingly, the response to these concerns is for countries to create what are known as registers of beneficial interests, where the 'beneficial' interest denotes the person(s) ultimately controlling or owning the organisation in question.
New Zealand has previously committed, in various forums concerning transparency/openness, to pursuing a register of beneficial interest, but it is not clear what progress has been made. It is important that the next action plan commits to actually completing such a register.
Why the contribution is important
New Zealand has a relatively minimalist approach to regulating organisations such as companies, at least in comparison to other major developed economies. New Zealand also has an exceptionally large number of trusts, which currently are subject to very minimal scrutiny. Weaknesses have already been exposed, though to some extent addressed, in the controversy around foreign trusts as revealed in the Panama Papers. In addition, as New Zealand businesses become increasingly integrated with the global economy (coronavirus notwithstanding), the likelihood of corrupt practices being imported increases. New Zealand is also being left behind by countries like the UK in the creation of important anti-corruption mechanisms such as a register of beneficial interests. It is accordingly important that such a register be created.
by maxrash on March 09, 2021 at 05:09PM