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Some EU nations remove public beneficial ownership records after ECJ judgement

The aftermath of Tuesday's major ruling by the Court of Justice of the European Union over public beneficial ownership databases has persisted.

Following the verdict that sent shockwaves through the AFC community, a number of EU governments have began removing these records.


Following Tuesday's verdict, both Luxembourg and the Netherlands have officially shuttered their public beneficial ownership registers.


The online register for Luxembourg is "temporarily halted," while the portal for the Netherlands displays a similar notice.



The ruling that public beneficial ownership databases are "invalid" has been roundly criticised by advocates for more corporate transparency.


The court held that such access to beneficial ownership information is a "severe violation of the fundamental rights to respect for private life and to the protection of personal data."


Tuesday, AML Intelligence published an opinion piece by David Lewis, former Executive Secretary of the Financial Action Task Force, in which he posed the following question: "Is the EU Court saying that it’s no longer proportionate to make information on company directors available? Surely as an economy, if you want to be open to business, then businesses should know who they are going into business with?”


He added: “Making information public on who owns and controls companies is not only good business sense and good governance, but it significantly speeds up investigations into corruption.”


“It’s not enough for information on who owns and controls companies to be available to competent authorities (the police, etc.) in the countries where they are registered.


“Obviously, this information needs to be checked and accurate. But it also needs to be available to those in the private sector required by law to conduct customer due diligence, i.e., banks, lawyers, etc. And if you make it available to all regulated businesses then it’s difficult to justify not making it public,” he argues.

By fLEXI tEAM



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