Cayman Islands reject Cameron’s tax offensive

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David Cameron has been urged to intensify efforts to prise open offshore companies by campaigners who say the resistance of Britain’s overseas territories to his transparency drive is a “national embarrassment”.

But Westminster’s latest demands have been flatly rejected by the Cayman Islands, which said last week that no country in the world gave unfettered access to the information Britain was asking for.

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The disagreements were aired ahead of a meeting of the overseas territories at Lancaster House in London this week at which James Duddridge, a Foreign Office minister, will press them “to repeat their commitments to uphold international standards of transparency”.

The talks are latest in a series of discussions that began in 2013 when the prime minister put efforts to crack down on tax evasion and financial crime at the centre of the G8 summit in Northern Ireland.

In a public letter, the heads of 11 charities and pressure groups urged the prime minister to use the meeting with the overseas territories to ensure they met his request for central, public registries of who ultimately owns and controls companies in their jurisdictions.

They said: “In doing so, you would be establishing a legacy that would help improve the lives of millions of the world’s poorest people.” The signatories included the heads of Oxfam, Christian Aid, ActionAid, Transparency International and Global Witness.

This year, the government asked the British Virgin Islands, the Cayman Islands and Bermuda to set out plans for central registers “or similarly effective systems” in time for next week’s meeting. Among other requirements, it said UK law enforcement and tax authorities must be able to access company beneficial ownership information without restriction.

Mr Duddridge said last week: “Progress has been made towards the greater use of central registers and we are currently working on security and police forces’ access to them, but . . . ultimately, we will have to move in the direction of public access to that information.”

Alden McLaughlin, the premier of the Cayman Islands, told its legislative assembly on November 26 that he had turned down the latest request of the UK government to give law enforcement agencies direct access to beneficial ownership information. “To do otherwise would place the Cayman Islands at a competitive disadvantage with other jurisdictions that do not permit unfettered access to beneficial ownership,” he said.

 

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The Cayman Islands said it had been “working diligently” to enhance its regime to allow rapid response to information requests from foreign competent authorities. It expected the changes to become law by the second quarter of next year. The BVI recently announced a policy to strengthen its existing approach to meet global standards “and address any weakness in the system”.

Everard Richards, deputy premier of Bermuda, said it was “in open discussions” with the UK but stressed it already had a centrally held register of beneficial ownership. He said: “We continue to stand with the British government as standard bearers of best practice in tax transparency and compliance.”

Richard Hay, counsel to IFC forum, a group representing professional services firms in the offshore finance centres, said the overseas territories regarded the UK’s approach to collecting beneficial ownership information as inferior to their own because it had no provision for systematic verification. He said the UK’s new system was not “self-evidently compliant” with international requirements.

 

 

 

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