This announcement comes following a commitment made at the G8 summit this summer to establish a central register of company beneficial ownership, Cameron has now confirmed this is to go ahead – and be made open to the public.
The Companies House register is designed to expose those companies that keep the true ownership of the business secret in an attempt to avoid paying tax and hide profits.
In a speech today at the Open Government Partnership, the prime minister said that making the register available to the public will allow all UK companies to “better identify” who they are really doing business with.
“For too long a small minority have hidden their business dealings behind a complicated web of shell companies, and this cloak of secrecy has fuelled all manners of questionable practice – and downright illegality,” he said.
“Not only is this hugely unfair to the millions of hardworking people in Britain who pay their tax, it’s also bad for business.
“To keep corporate taxes low, you’ve got to keep corporate taxes coming in. As I’ve put it, no tax base – no low tax case. So that’s why we need to shine a spotlight on who owns what and where money is really flowing.”
He added that Britain is leading the way in this kind of transparency, and urged the rest of the world to follow suit.
Business secretary Vince Cable said having a public register will make Britain a better place to invest and do business.
“The vast majority of companies and directors in the UK contribute productively to the economy, abide by the rules and make an enormous contribution to society.
“But an errant few operate in the shadows, creating ownership structures that serve to deceive. We’re now shining a light on who really owns and controls companies in the UK and proudly leading the world in this initiative.”
However Dr Adam Marshall, director of policy at the British Chambers of Commerce warned the move could increase regulatory burdens for many businesses.
“Many will be concerned that the introduction of a universal register of beneficial ownership could create unintended consequences for law-abiding businesses, such as increased regulatory and reporting burdens.
“Ministers must work with business to address these concerns over the coming weeks, and ensure the UK doesn’t go it alone when it comes to good corporate governance.”
It is thought that the government may use the same method that currently applies to the disclosure of information on company shareholders, meaning that companies would hold information on the names and addresses of their beneficial owners and details of their interest in the company, and Companies House would hold – and make publicly accessible – the names of the beneficial owners and details of their interest in the company.
