{"id":677,"date":"2022-12-12T20:10:57","date_gmt":"2022-12-12T20:10:57","guid":{"rendered":"https:\/\/michaelbcons.crmpc.co.uk\/?p=677"},"modified":"2022-12-12T20:19:56","modified_gmt":"2022-12-12T20:19:56","slug":"beneficial-ownership-balancing-transparency-and-privacy","status":"publish","type":"post","link":"https:\/\/michaelbcons.crmpc.co.uk\/?p=677","title":{"rendered":"Beneficial ownership: Balancing transparency and privacy"},"content":{"rendered":"\t\t
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\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\tBeneficial ownership: Balancing transparency and privacy <\/a>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t

Much has been written about the benefits to law enforcement agencies of having access to reliable information on the ultimate beneficial ownership (BO) of companies. It is also clearly an important part of the work done by financial institutions and professional advisors in meeting anti-money laundering and KYC requirements. These benefits extend further if that BO information is made public, as this opens up the significant potential benefits for private sector users, as discussed on our previous bog piece, found here. But at what price?<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

There is a compliance burden, although with a well-designed regime this should be minimal. Indeed, evidence from the UK suggests that the benefits to business of a public register can significantly outweigh the costs.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Then there is the cost to privacy. Any additional mechanism whereby a government agency collects personal information will always raise questions of privacy. If that agency then makes that information public, the concern is that much greater.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

But is this really a cause for concern?<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

The privacy argument generally manifests itself in three ways.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Identity theft<\/span><\/b>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Phishing scams are a real issue, where criminals extract personal information in order to impersonate people or steal their identity for financial gain. These criminals will start with names, addresses and dates of birth, but then try to extract banking details, passwords or PIN numbers.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Does a public BO register facilitate identity theft?<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

It\u2019s correct that a BO register needs to collect personal information about individuals. This is a vital part of uniquely identifying people. But there is an important distinction to be made between information <\/span>collected<\/span><\/b> by a register, and information <\/span>published <\/span><\/b>by a register. For example, the UK beneficial ownership register (the Register of Persons with Significant Control, or PSC Register) collects the full date of birth of all beneficial owners. However, it only publishes the month and year of birth.\u00a0 Residential addresses are also collected but not made public on the register.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

So, a BO register can be designed and implemented in such a way as to mitigate the risk of identity theft, and in many cases doesn\u2019t need to disclose more personal information than many people choose to share through their personal or business social media.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Personal safety<\/span><\/b>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

It is clear that wealth and influence can sometimes lead to concerns around personal safety, whether that is an increased risk of burglary, personal attacks or even kidnap. These risks are real, and have been a concern for the wealthy as long as wealth has existed.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Does a public BO register increase the risk to personal safety?<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Firstly, it is important to acknowledge that the identities, residences and movements of the wealthiest in society are already well known. We live in a world in which most people carry a smartphone with a camera and are connected to social media.\u00a0 A criminal wishing harm on a well-known or wealthy individual does not need a BO register to gain crucial personal information.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

So, the real concern should be with those cases where the BO register puts <\/span>new<\/span><\/b> information into the public domain; information made public solely and directly as a result of beneficial ownership transparency. And that information would put an individual in personal danger. The answer here is to allow certain individuals to have their BO information redacted.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

This can be achieved without undermining the integrity of the BO register by very tightly drafted rules allowing for the redaction of BO information in very specific circumstances. This shouldn\u2019t be a free pass for the rich and famous, but rather an important protection for those people owning companies with activities which might make them a target, such as life sciences or animal testing. The UK has this form of exemption.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Cultural<\/span><\/b>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

This is probably one of the biggest obstacles to BO transparency in some countries.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

The UK has for a long time had a cultural acceptance of certain amounts of transparency in business. Companies are obliged to prepare annual financial statements, and those are publicly available, together with details of legal ownership. So, the step of making the ultimate BO of those companies public too was not that great.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

However, in countries which don\u2019t have the same culture of corporate disclosure, BO can feel like a significant intrusion. There are jurisdictions, both OECD and non-OECD countries, where corporate disclosure requirements are minimal, and it is difficult obtain even basic information about companies e.g. some US states.\u00a0 More beneficial ownership transparency is therefore important for law enforcement and business integrity.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

So, is there really a privacy issue with BO transparency?\u00a0<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Well, yes and no. Concerns regarding identity theft and personal safety can be addressed through a well-designed and managed public register. The real issue comes down to a more nebulous concern about personal information in general. Do the benefits of having a public register of BO outweigh limited loss of privacy?<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

The argument of \u201cwhy should you care if you have nothing to hide?\u201d doesn\u2019t really get there. People do care about their privacy, whether or not they are well-known.\u00a0 Business owners in Germany have expressed concern about the privacy implications of EU beneficial ownership transparency requirements and the balance with information disclosure regulations.\u00a0 But the truth is, most people have better things to do with their time, even during Covid lockdowns, than search for the businesses interests of their friends and neighbours.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

The real question is whether additional personal information made public by a BO register is a reasonable price to create a tool to improve the integrity of the business environment and tackle corruption, money laundering, terrorism financing, tax evasion and a host of other financial crimes. The number of countries implementing public BO registers would suggest that those scales are coming down on the side of greater transparency.<\/span>\u00a0<\/span><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t

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\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\tPropri\u00e9t\u00e9 effective : \u00e9quilibrer la transparence et la protection de la vie priv\u00e9e <\/a>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t

On a beaucoup \u00e9crit sur les avantages pour les organismes d\u2019application de la loi d\u2019avoir acc\u00e8s \u00e0 des informations fiables sur la propri\u00e9t\u00e9 effective ultime des entreprises. Il s\u2019agit \u00e9galement clairement d\u2019une partie importante du travail effectu\u00e9 par les institutions financi\u00e8res et les conseillers professionnels pour r\u00e9pondre aux exigences en mati\u00e8re de lutte contre le blanchiment d\u2019argent et de connaissance du client. Ces avantages s\u2019\u00e9tendent davantage si cette information BO est rendue publique, car cela ouvre les avantages potentiels importants pour les utilisateurs du secteur priv\u00e9, comme discut\u00e9 dans notre article de blog pr\u00e9c\u00e9dent, trouv\u00e9 ici. Mais \u00e0 quel prix ?<\/span>\u00a0<\/span><\/p>\n

Il y a un fardeau de conformit\u00e9, bien qu\u2019avec un r\u00e9gime bien con\u00e7u, il devrait \u00eatre minime. En effet, les donn\u00e9es recueillies au Royaume-Uni donnent \u00e0 penser que les avantages pour les entreprises d\u2019un registre public peuvent largement l\u2019emporter sur les co\u00fbts.<\/span>\u00a0<\/span><\/p>\n

Ensuite, il y a le co\u00fbt pour la protection de la vie priv\u00e9e. Tout m\u00e9canisme suppl\u00e9mentaire par lequel un organisme gouvernemental recueille des renseignements personnels soul\u00e8vera toujours des questions de protection de la vie priv\u00e9e. Si cet organisme rend ensuite cette information publique, la pr\u00e9occupation est d\u2019autant plus grande.<\/span>\u00a0<\/span><\/p>\n

Mais est-ce vraiment une source d\u2019inqui\u00e9tude?<\/span>\u00a0<\/span><\/p>\n

L\u2019argument de la protection de la vie priv\u00e9e se manifeste g\u00e9n\u00e9ralement de trois fa\u00e7ons.<\/span>\u00a0<\/span><\/p>\n

Vol d\u2019identit\u00e9<\/span><\/b>\u00a0<\/span><\/p>\n

Les escroqueries par hame\u00e7onnage sont un v\u00e9ritable probl\u00e8me, o\u00f9 les criminels extraient des informations personnelles afin d\u2019usurper l\u2019identit\u00e9 de personnes ou de voler leur identit\u00e9 \u00e0 des fins financi\u00e8res. Ces criminels commenceront par des noms, des adresses et des dates de naissance, mais essaieront ensuite d\u2019extraire des coordonn\u00e9es bancaires, des mots de passe ou des codes PIN.<\/span>\u00a0<\/span><\/p>\n

Un registre public des BO facilite-t-il le vol d\u2019identit\u00e9?<\/span>\u00a0<\/span><\/p>\n

Il est exact qu\u2019un registre BO doit collecter des informations personnelles sur les individus. C\u2019est un \u00e9l\u00e9ment essentiel de l\u2019identification unique des personnes. Mais il y a une distinction importante \u00e0 faire entre les informations <\/span>collect\u00e9es<\/span><\/b> par un registre\u00a0<\/span> et les informations publi\u00e9es par un\u00a0<\/span> registre. Par exemple, le registre des b\u00e9n\u00e9ficiaires effectifs du Royaume-Uni (le Registre des personnes ayant un contr\u00f4le significatif, ou Registre PSC) recueille la date de naissance compl\u00e8te de tous les b\u00e9n\u00e9ficiaires effectifs. Cependant, il ne publie que le mois et l\u2019ann\u00e9e de naissance.\u202f\u202fLes adresses r\u00e9sidentielles sont \u00e9galement collect\u00e9es, mais ne sont pas rendues publiques dans le registre.<\/span>\u00a0<\/span><\/p>\n

Ainsi, un registre BO peut \u00eatre con\u00e7u et mis en \u0153uvre de mani\u00e8re \u00e0 att\u00e9nuer le risque de vol d\u2019identit\u00e9 et, dans de nombreux cas, n\u2019a pas besoin de divulguer plus d\u2019informations personnelles que ce que de nombreuses personnes choisissent de partager via leurs m\u00e9dias sociaux personnels ou professionnels.<\/span>\u00a0<\/span><\/p>\n

S\u00e9curit\u00e9 personnelle<\/span><\/b>\u00a0<\/span><\/p>\n

Il est clair que la richesse et l\u2019influence peuvent parfois susciter des inqui\u00e9tudes quant \u00e0 la s\u00e9curit\u00e9 personnelle, qu\u2019il s\u2019agisse d\u2019un risque accru de cambriolage, d\u2019attaques personnelles ou m\u00eame d\u2019enl\u00e8vement. Ces risques sont r\u00e9els et pr\u00e9occupent les riches depuis que la richesse existe.<\/span>\u00a0<\/span><\/p>\n

Un registre public des BO augmente-t-il le risque pour la s\u00e9curit\u00e9 personnelle?<\/span>\u00a0<\/span><\/p>\n

Premi\u00e8rement, il est important de reconna\u00eetre que les identit\u00e9s, les r\u00e9sidences et les mouvements des plus riches de la soci\u00e9t\u00e9 sont d\u00e9j\u00e0 bien connus. Nous vivons dans un monde o\u00f9 la plupart des gens portent un smartphone avec un appareil photo et sont connect\u00e9s aux m\u00e9dias sociaux.\u202f\u202fUn criminel qui souhaite nuire \u00e0 une personne bien connue ou riche n\u2019a pas besoin d\u2019un registre BO pour obtenir des informations personnelles cruciales.<\/span>\u00a0<\/span><\/p>\n

La v\u00e9ritable pr\u00e9occupation devrait donc concerner les cas o\u00f9 le registre BO met de <\/span>nouvelles<\/span><\/b> informations\u00a0<\/span> dans le domaine public; informations rendues publiques uniquement et directement gr\u00e2ce \u00e0 la transparence de la propri\u00e9t\u00e9 effective. Et cette information mettrait une personne en danger personnel. La r\u00e9ponse ici est de permettre \u00e0 certaines personnes de faire expurger leurs informations BO.<\/span>\u00a0<\/span><\/p>\n

Cet objectif peut \u00eatre atteint sans compromettre l\u2019int\u00e9grit\u00e9 du registre des BO gr\u00e2ce \u00e0 des r\u00e8gles tr\u00e8s strictes permettant la r\u00e9daction des informations BO dans des circonstances tr\u00e8s sp\u00e9cifiques. Cela ne devrait pas \u00eatre un laissez-passer gratuit pour les riches et c\u00e9l\u00e8bres, mais plut\u00f4t une protection importante pour les propri\u00e9taires d\u2019entreprises dont les activit\u00e9s pourraient en faire une cible, telles que les sciences de la vie ou les tests sur les animaux. Le Royaume-Uni a cette forme d\u2019exemption.<\/span>\u00a0<\/span><\/p>\n

Culturel<\/span><\/b>\u00a0<\/span><\/p>\n

C\u2019est probablement l\u2019un des plus grands obstacles \u00e0 la transparence des BO dans certains pays.<\/span>\u00a0<\/span><\/p>\n

Le Royaume-Uni a longtemps eu une acceptation culturelle de certaines quantit\u00e9s de transparence dans les affaires. Les entreprises sont tenues d\u2019\u00e9tablir des \u00e9tats financiers annuels, qui sont accessibles au public, ainsi que des d\u00e9tails sur la propri\u00e9t\u00e9 l\u00e9gale. Ainsi, l\u2019\u00e9tape consistant \u00e0 rendre public le BO ultime de ces entreprises n\u2019\u00e9tait pas si g\u00e9niale.<\/span>\u00a0<\/span><\/p>\n

Cependant, dans les pays qui n\u2019ont pas la m\u00eame culture de la divulgation d\u2019entreprise, BO peut \u00eatre ressenti comme une intrusion importante. Il existe des juridictions, tant dans les pays membres de l\u2019OCDE que dans les pays non membres de l\u2019OCDE, o\u00f9 les exigences en mati\u00e8re de divulgation des entreprises sont minimes et o\u00f9 il est difficile d\u2019obtenir ne serait-ce que des informations de base sur les soci\u00e9t\u00e9s, par exemple certains \u00c9tats am\u00e9ricains.\u202f\u202fUne plus grande transparence de la propri\u00e9t\u00e9 effective est donc importante pour l\u2019application de la loi et l\u2019int\u00e9grit\u00e9 des entreprises.<\/span>\u00a0<\/span><\/p>\n

Alors, y a-t-il vraiment un probl\u00e8me de confidentialit\u00e9 avec la transparence BO?<\/span>\u00a0<\/span><\/p>\n

Eh bien, oui et non. Les pr\u00e9occupations concernant le vol d\u2019identit\u00e9 et la s\u00e9curit\u00e9 personnelle peuvent \u00eatre abord\u00e9es au moyen d\u2019un registre public bien con\u00e7u et g\u00e9r\u00e9. Le vrai probl\u00e8me se r\u00e9sume \u00e0 une pr\u00e9occupation plus n\u00e9buleuse au sujet des renseignements personnels en g\u00e9n\u00e9ral. Les avantages d\u2019avoir un registre public des BO l\u2019emportent-ils sur la perte limit\u00e9e de la vie priv\u00e9e?<\/span>\u00a0<\/span><\/p>\n

L\u2019argument de \u00ab\u202fpourquoi devriez-vous vous en soucier si vous n\u2019avez rien \u00e0 cacher?\u202f\u00bb n\u2019y arrive pas vraiment. Les gens se soucient de leur vie priv\u00e9e, qu\u2019ils soient connus ou non.\u202f\u202fLes propri\u00e9taires d\u2019entreprises en Allemagne ont exprim\u00e9 leur inqui\u00e9tude quant aux implications pour la vie priv\u00e9e des exigences de transparence de la propri\u00e9t\u00e9 effective de l\u2019UE et de l\u2019\u00e9quilibre avec les r\u00e9glementations en mati\u00e8re de divulgation d\u2019informations.\u202f\u202fMais la v\u00e9rit\u00e9 est que la plupart des gens ont mieux \u00e0 faire de leur temps, m\u00eame pendant les confinements Covid, que de rechercher les int\u00e9r\u00eats commerciaux de leurs amis et voisins.<\/span>\u00a0<\/span><\/p>\n

La vraie question est de savoir si les informations personnelles suppl\u00e9mentaires rendues publiques par un registre BO constituent un prix raisonnable pour cr\u00e9er un outil permettant d\u2019am\u00e9liorer l\u2019int\u00e9grit\u00e9 de l\u2019environnement des affaires et de lutter contre la corruption, le blanchiment d\u2019argent, le financement du terrorisme, l\u2019\u00e9vasion fiscale et une foule d\u2019autres crimes financiers. Le nombre de pays mettant en \u0153uvre des registres publics des BO sugg\u00e8re que ces bar\u00e8mes vont dans le sens d\u2019une plus grande transparence.<\/span>\u00a0<\/span><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Beneficial ownership: Balancing transparency and privacy Much has been written about the benefits to law enforcement agencies of having access […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-677","post","type-post","status-publish","format-standard","hentry","category-uncategorised"],"_links":{"self":[{"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/677","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=677"}],"version-history":[{"count":10,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/677\/revisions"}],"predecessor-version":[{"id":687,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/677\/revisions\/687"}],"wp:attachment":[{"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=677"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=677"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/michaelbcons.crmpc.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=677"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}