UK offshore companies side-step new transparency rules

 
Oliver Gill
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Panama Canal
The release of the Panama Papers earlier this year helped put more weight behind calls for greater corporate transparency (Source: Getty)

Some of Britain's offshore companies have continued to wriggle out of new transparency restrictions according to research released this weekend.

Under rules brought in on 1 July 2016, British companies need to disclose on an annual basis any changes to directors or shareholders – both being deemed "persons of significant control".

Read more: New corporate tax rules will only work if there's cooperation

Of the 300 offshore companies identified by Reuters, 22 were deemed as being required to make the disclosure by now. Companies are supposed to make the disclosure each year on their anniversary of incorporation.

However, all but one had failed to do so. 12 companies filed early – before 1 July – in order to negate the need to make the disclosures this year.

The other eight filed late or said that they did not have any beneficial owners.

Critics of the new system pointed to the fact that the onus was still on companies to ensure that their affairs are in order.

“One of the biggest flaws with the UK set up is that it is based on self-reporting and Companies House has limited resources to go after people who fail to provide information or provide incorrect information,” said Robert Palmer of advocacy group Global Witness.

Nevertheless, government officials remained confident that in time these changes would work.

“These changes will ensure that companies are more transparent about who actually owns them.

"We have always been clear that the Companies House public register will be built up over time and completed by June 2017,” said Daniel Munden of Department for Business, Energy and Industrial Strategy.

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