European Court Backs Right to Privacy
Secret tax havens won a major concession from the European Court of Justice. In a surprising victory for privacy and freedom, the court decided that companies based in tax havens have the right to keep the identities of their owners secret.
Many countries such as the UK and its associated tax havens have been trying to make offshore company ownership more transparent. There is now very little secrecy in tax havens such as Jersey, Isle of Man and the BVI. All beneficial owners must be declared. In the UK beneficial owners must be publicly declared to the companies registry.
There is currently no need to verify the identity of directors and beneficial owners of UK companies. This is in the process of being changed. A new Economic Crime bill is going through the British parliament to force this change.
The European Court of Justice has gone in the opposite direction with its recent ruling.
Secret Tax Havens are Back!
Since the ruling Ireland, The Netherlands, Luxembourg and Austria have blocked public access to company records. This makes it extremely difficult for casual snoopers to find out who’s behind a company.
It’s going to be interesting to see what the UK, Bermuda, Isle of Man and the BVI do about the European ruling. Guernsey, Jersey and the Isle of Man had pledged to open their companies registers to the public by the end of next year. This is now in jeopardy. Perhaps some of these jurisdictions will revert to being more secret tax havens.
Despite the UK leaving the European Union, it remains part of the ECJ. The UK’s tax havens may be forced to change their own rules, reversing recent moves towards more transparency.
Luxembourg Corporate Owners Demand Privacy
The case was brought to the ECJ by two unidentified owners of a Luxembourg company. Quite rightly, they objected to their personal details being available in public documents. The ECJ said in its ruling that ‘the public’s access to information on beneficial ownership constitutes a serious interference with the fundamental rights to respect for private life and to the protection of personal data.’
This is good news for privacy and undoubtedly a step in the right direction. However, anyone setting up an offshore structure must go much further to remain anonymous and protect the assets stored inside offshore companies. But, for now, let’s welcome this victory and hope that things have started to turn back towards privacy.
Ireland Restores Secrecy
While Ireland can’t be described as one of the world’s secret tax havens it offers some benefits for those who want to keep some secrecy without attracting attention. Because Ireland is ostensibly a high tax country it doesn’t appear on any black lists. If the top company in your offshore structure is from Panama or The Cook Islands you’ll face a much higher degree of scrutiny from banks and other counterparties than you will with an Irish company.
It can be beneficial to have a low tax Irish company as part of your structure. You’ll pay hardly any tax, with a bit of planning. And you won’t face the same difficult questions from banks as to why your company’s ownership is in secret tax havens.
Liberty Mundo helps clients set up offshore structures to make your assets untouchable. No matter how powerful your adversary. No matter if it’s a major corporation, large law firms with unlimited budgets or the government if your structure’s set up properly your assets will be safe from seizure. Get in touch with us today to confidentially discuss your situations. You can connect with us here.