Limitations Exposed in Vatican’s Legal Person Registration System

VATICAN CITY, HOLY SEE

Shortcomings in the System

A recent assessment has revealed several shortcomings in the Holy See’s system for registering legal persons, including limitations on access to information and inadequate record-keeping.

Unclear Definitions and Inadequate Record-Keeping

The assessment found that:

• The system lacks clear definitions of what constitutes a legal person
• Insufficient sanctions are in place for non-compliance with requirements
• Limited accessibility is available to foreign authorities
• It is unclear how the quality of assistance received from legal persons is being monitored

Criteria for Non-Instrumental Legal Persons

The assessment team applied criteria to non-instrumental legal persons, including:

• Foundations and associations, which are subject to the same creation process, corporate bodies, and activities as instrumental entities
• Corporate bodies and activities

However, the team found that the system has several limitations. For instance:

• It is unclear what types of information are required to be kept by legal persons
• When these records would be updated
• How the quality of assistance received from legal persons is being monitored

Call for Improvement

The assessment also highlighted the need for more robust sanctions for serious failures to comply with requirements, as well as better access to information for foreign authorities.

Vatican Response

In response to the findings, Vatican officials have pledged to address the shortcomings and improve the system for registering legal persons.

“We take these concerns seriously and are committed to ensuring that our system is transparent, efficient, and effective in preventing money laundering and terrorist financing,” said a Vatican spokesperson.

Ongoing Efforts to Combat Financial Crimes

The assessment is part of ongoing efforts by international organizations and governments to combat financial crimes and ensure greater transparency and accountability in financial transactions.