Beneficial Ownership Registration: A Global Perspective

Jurisdictional Progress

In recent years, there has been a significant increase in the number of countries with laws requiring beneficial ownership information to be registered. As of February 2020, 81 countries have implemented such measures, covering various regions including Africa, Latin America, the Middle East, and South-East Asia.

Beneficial Ownership Registration Considerations

Scope

The effectiveness of beneficial ownership registration depends on which legal vehicles are covered by the law. Ideally, all types of legal vehicles should be required to register their beneficial owners.

Triggers

Registration is typically triggered by one of three criteria:

• Place of incorporation or governing law: Beneficial ownership registration should be a prerequisite for legal existence.
• Local operations: Legal vehicles, especially foreign ones, should register their beneficial owners before operating in the country.
• Resident participant: Countries require legal vehicles to register their beneficial owners if any of its legal owners, beneficial owners, directors, settlors, beneficiaries, etc. are resident in the country.

Beneficial Ownership Definition

The definition of beneficial ownership will determine how many individuals are subject to beneficial ownership registration. A clear and comprehensive definition is essential to ensure that all relevant parties are included.

Key Points

• The Tax Justice Network published a checklist in 2017 detailing issues a jurisdiction needs to consider when establishing a beneficial ownership register.
• Beneficial ownership registration means requiring legal vehicles (e.g., companies, trusts) to register their beneficial owners with government authorities.
• The effectiveness of beneficial ownership registration depends on several factors, including scope, triggers, and the beneficial ownership definition.