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Premier Smith yields to UK pressure on Beneficial Ownership Register

- despite opposition to the move by a large percentage of persons in the territory
With the Panama Papers scandal casting a negative light on the Virgin Islands and the United Kingdom continuing to put pressure on its overseas dependencies to open up access to Beneficial Ownership information even while British Prime Minister David Cameron faces harsh criticisms and protests against his involvement and benefiting from the offshore industry, Premier and Minister of Finance Dr The Honourable D. Orlando Smith has yielded and signed Exchange Notes on Beneficial Ownership Information. Premier Smith (centre) made the announcement on Friday April 9, 2016 during a press conference held at the Central Administration Complex during which he spoke of the issue of the Panama Papers. Present with him were acting PS in the Office of the Premier Broderick Penn (left) and Financial Secretary Neil M. Smith (right). Photo: VINO/File
According to the Premier, the Exchange of Notes also meets the territory's Joint Ministerial Council (JMC) Communique 2015 commitments with the UK in which we agreed to “further developing a timely, safe and secure information exchange process to increase our collective effectiveness for the purpose of law enforcement” in relation to beneficial ownership. Photo: Provided
According to the Premier, the Exchange of Notes also meets the territory's Joint Ministerial Council (JMC) Communique 2015 commitments with the UK in which we agreed to “further developing a timely, safe and secure information exchange process to increase our collective effectiveness for the purpose of law enforcement” in relation to beneficial ownership. Photo: Provided
ROAD TOWN, Tortola, VI – With the Panama Papers scandal casting a negative light on the Virgin Islands and the UK continuing to put pressure on its overseas dependencies to open up access to Beneficial Ownership Information even while British PM David Cameron faces harsh criticisms and protests against his involvement and benefiting from the offshore industry, Premier and Minister of Finance Dr The Honourable D. Orlando Smith has yielded and signed Exchange Notes on Beneficial Ownership Information.

Premier Smith made the announcement on Friday April 9, 2016 during a press conference at the Central Administration Complex during which he spoke on the issue of the Panama Papers.

“Earlier today, I have agreed to sign an Exchange of Notes on Beneficial Ownership with the UK that builds on the successful existing relationship and daily exchanges between BVI and UK law enforcement authorities who remain in regular contact,” he stated.

This means that British police will soon be able to access information of offshore companies in British Overseas Territories.

Britain is creating a list that reveals the identities of individuals who benefit from an investment even if it is held in the name of another person. According to The Guardian, Cameron told the House of Commons on Monday April 11, 2016 that all British crown dependencies and overseas territories except Anguilla and Guernsey had already signed up to furnish the information.

These include areas such as the Cayman Islands and [British Virgin Islands], which the UK regard as "hot spots" of offshore activity.

While information from the so-called register of beneficial ownership will not be made public, it will be available to police and law enforcement agencies in Britain and other countries. Companies will be held criminally liable if they fail to stop their employees from facilitating tax evasion.

Critics argue that the Overseas Territories may have been further pressured to sign an Exchange of Notes on Beneficial Ownership with the UK as Cameron seeks to defuse pressure over his tax affairs linked to the so-called Panama Papers.

The UK prime minister has been facing the heat over his handling of information about Panama-based companies, including an offshore trust set up by his late father, Ian Cameron.

Premier Smith defends decision to sign agreement

The agreement also bolsters the VI’s ongoing international cooperation with other jurisdictions around the world, particularly fellow members of the Egmont Group of Financial Intelligence Units, and is complimentary to the jurisdiction’s good standing in meeting our international commitments on tax, transparency and anti-corruption under Foreign Account Tax Compliance Act (FATCA), Organisation for Economic Co-operation and Development (OECD), The Financial Action Task Force (FATF) and the and the United Nations (UN).

“In effect, we have agreed on the principles and process for improving information exchange with the UK,” he said.

According to the Premier, the Exchange of Notes also meets our Joint Ministerial Council (JMC) Communique 2015 commitments with the UK in which we agreed to “further developing a timely, safe and secure information exchange process to increase our collective effectiveness for the purpose of law enforcement” in relation to beneficial ownership.

He said the VI’s long-standing commitment to international standards on tax and transparency, its robust regulatory regime, and enhanced cooperation with the UK underscores the territory's continuous efforts to maintain the integrity of the international financial system.

“As Premier and Minister of Finance, I can assure the public and our international partners, that the BVI will remain a jurisdiction of the highest integrity and a reliable international partner,” he said.

The question was asked whether the signing of the Exchange Notes was in response to the fallout from the Panama Papers leak and its effect on the territory, but he said that this is something that had been in train for a while.

“For some time now, since December 2015, we have been having discussions with the British Government on the matter of beneficial ownership and how it should be kept in the territory. You would know that last year we made some changes in our regulations to require that beneficial ownership be kept in the British Virgin Islands. The discussion on how it would be kept is what is ongoing now.”

The Premier said that while there are a number of processes still to be completed, he has signed the agreement and thus the way forward is much clearer in that there will be a satisfactory system of exchange of information that will be to the benefit of the VI and that will not compromise the industry and facilitate the investigation on tax or anti-terrorism.

Persons opposed to the move

In a statement in the House of Assembly on Thursday, February 12, 2015 Premier Smith told the people of the Virgin Islands that key stakeholders within the territory’s financial and social services sectors did not support the Virgin Islands establishing a Beneficial Ownership central register, preferring the current regime which has been shown to work.

In fact, in the statement at the Third Sitting of the Fourth Session of the Second House of Assembly, Dr Smith, the second Premier of the British Overseas Territory, gave statistics to support his claim. He said some 81% did not support the Register of Beneficial Ownership and 71% of respondents rejected the idea of allowing public access to a Register of Beneficial Ownership.

Premier Smith said some of the key reasons cited against the establishment of a central register essentially related to compliance cost that could actually damage the competitive position of the VI vis-à-vis other international finance centers.

Furthermore, Premier Smith, in standing against what he just agreed to in the United Kingdom at the December 1 and 2 meeting with the VI and other Overseas Territories, told the people that one of his objections then in opposing the Register of Beneficial Ownership, was that he was concerned about data security, the increased potential for fraud and the infringement of constitutional rights of privacy.

Persons flooded our newsroom with calls and emails to ask whether the Premier had betrayed the people of the territory who feel the Register of Beneficial Ownership would compromise the financial services industry.

42 Responses to “Premier Smith yields to UK pressure on Beneficial Ownership Register”

  • rio (12/04/2016, 09:09) Like (2) Dislike (0) Reply
    this man is broken and it beginning to show. Crystal Clear.
  • Xxx (12/04/2016, 09:18) Like (0) Dislike (2) Reply
    Oh lord poor we
  • farmer (12/04/2016, 09:23) Like (1) Dislike (0) Reply
    rastarite say plant food, so i guess it's back to the grounds for all ar we.
    • @ FARMER (14/04/2016, 23:39) Like (0) Dislike (0) Reply
      soon , the only thing poor people will have left to eat will be the rich.....hmmmmmmmmmmm
  • screwed (12/04/2016, 09:29) Like (2) Dislike (0) Reply
    He had to give in. Our financial industry is now screwed
  • No! (12/04/2016, 09:34) Like (0) Dislike (0) Reply
    The premier didn't yield on anything. There is a difference between creating registers where any media or member of the public can access and creating an avenue for tax and law enforcement authorities to access this information. This is no different to the new FATCA regime in the US where all banks and agents are required to report and provide access to information. The BVI does not run off of bush law and we have a robust regulatory system and Commercial Court to back our products.
  • I suspect this is only the beginning... (12/04/2016, 09:36) Like (2) Dislike (0) Reply
    Brace yourselves, SS BVI... there are rough waters ahead. Luckily, we are a seafaring people!
  • Jaqen H'ghar (12/04/2016, 09:47) Like (5) Dislike (0) Reply
    Valar Dohaeris
  • Scary Mary (12/04/2016, 09:58) Like (0) Dislike (0) Reply
    It has been clearly stated that the registrar of beneficial ownership of companies would only be available to law enforcement and tax agencies. THE NAMES WILL NOT BE MADE PUBLIC!

    I really don't see what the big deal is surrounding this issue. Perhaps someone with knowledge of the industry can shed some light on the subject for the rest of us?

    "If" we have nothing to hide (which is what everyone seems to be insisting) and companies within the BVI are not knowingly harbouring or in any way assisting tax dodgers, money launderers, and drug lords to hide money, then what is the problem having a register listing all beneficial owners? Once again, THE NAMES WILL NOT BE MADE PUBLIC and will only be accessible by law enforcement and tax agencies.

    Obviously, when one considers the Panama Papers leak and the one prior to that, our data security obviously needs a fair amount of improvement. Premier Smith argument that he is concerned about security doesn't really hold water these days.

    If the cost of performing due diligence for all offshore companies will make us non-competitive with other districts or hamper our ability to attract ongoing business, T H A T is the main problem we need to address. Perhaps the Brits can lend us a helping hand (for a predetermined number of years) in exchange for our compliance? Surely, we can find the money somewhere. We seem to find money for all sorts of other things that are not nearly as pressing.

    Eventually, all districts that do not comply with internationally accepted practices will or should be blacklisted by all other nations that do. That would seem to be the only solution to combat illegal practices. Cut them off as trading partners. Cut off access to their banks for all banks located in compliant regions, and make it illegal to deal with them! Then you would have a law that has some real teeth and a level playing field for the rest of the world.

    I realize this is a very likely a simplistic view of a very complicated problem, but what exactly am I missing? Why is this such a huge debacle if we really have nothing to hide?


  • Educate me (12/04/2016, 09:59) Like (0) Dislike (0) Reply
    just the facts; is the government of England four square against people having any privacy? should they let people
    know about all this prior to moving to a British territory or protectorate? Does the British government have any
    brakes or is it a runaway train? Do I have any rights to privacy including financial affairs when I reside in the British
    Virgin Islands or other territory? Is it a crime to just be left alone? Has anyone seen Hitler recently, rumor is that he
    resides in London half the year and Washington the other half. Man of the world.
  • Welsa!! (12/04/2016, 10:13) Like (2) Dislike (0) Reply
    There goes the shifting of wealth management!!!
  • That's it (12/04/2016, 10:15) Like (3) Dislike (0) Reply
    The Premier has sold us out & we don't even know the half this deceiver of a leader has done.
  • People (12/04/2016, 10:18) Like (2) Dislike (0) Reply
    The UK knows that the NDP is so corrupt that anything the UK wants from us, Orlando our deceptive Premier must give them just so that he can avoid the UK from investigating his corrupt government. The only loosers: WE THE PEOPLE OF THE BVI! We're now slaves again.
  • tears (12/04/2016, 10:21) Like (3) Dislike (0) Reply
    Orlando has just destroyed the BVI for years to come but the people love him so much that that has blinded them from seeing this man's true colors.
  • Street reporter (12/04/2016, 11:03) Like (0) Dislike (0) Reply
    Doc. Need to have them present evidence of wrong doing before he engage in answering any questions..
  • wize up (12/04/2016, 11:04) Like (1) Dislike (0) Reply
    thats why some of them under the NDP umbrella wants to see this territory go independent so them can hide them dirty fininancal dealings.... independence might be good for the territory but not with questionable leadership
  • well done (12/04/2016, 11:07) Like (0) Dislike (1) Reply
    Good move Premier. Better than they coming to take us over.
  • Ridic (12/04/2016, 11:44) Like (1) Dislike (0) Reply
    Tell me this is a joke! So the Premier never came out to defend the country during the whole Mossack Leak. Evidently Penn doesn't know how to do is job! And now because of one little incident (yes I said little) the Premier has signed an agreement that we fought so hard against.

    Brunch of jokers! Broderick please do your joke. All them foolish so called educated Advisors must Go!
    I cant stand weak leadership! My hard earned tax payers money wasting on jokers.
  • Truth (12/04/2016, 12:26) Like (1) Dislike (0) Reply
    anyone can help me acquire some used furniture (living room, dining, queen/king size bed, deep freeze center table just hoping
  • B Anonymous (12/04/2016, 12:27) Like (1) Dislike (1) Reply
    Awww yes eventually we will truly know who have the money around this place. Which politricktion flush with cash a whole lot off. Oh you know there will be a local leak lol.
  • evidence (12/04/2016, 13:42) Like (0) Dislike (0) Reply
    I will suggest that all this talking ceased until the accusers put their evidence of wrong doing on the table. Let them give us something to defend and to dispute..
  • the grabber (12/04/2016, 14:35) Like (2) Dislike (0) Reply
    The UK grabbing us by the balls slowly and these politicians enjoying the caress, but when the real squeeze grip happen we will feel the pain and be damaged forever.

    The ship is sinking!!!
  • Hmph (12/04/2016, 15:17) Like (2) Dislike (0) Reply
    There goes the neighborhood - the financial neighborhood that is, all these ppl gonna pull their business from the BVI and we will get WETTTTTT
  • Settler9 (12/04/2016, 15:24) Like (1) Dislike (0) Reply
    Premier should know that we are still on the plantation and still a "Kolony". Aahhumbug
  • Y'all vote them in! (12/04/2016, 15:36) Like (2) Dislike (0) Reply
    Say good bye to all we have accomplished.
  • Betrayal (12/04/2016, 15:48) Like (1) Dislike (1) Reply
    The RBVIPF have no authority but UK law enforcement agencies can demand information from private citizens? This does not make sense. The Premier needs to release the 'exchange of notes' he has committes the territory to.
  • The Diplomat (12/04/2016, 16:02) Like (0) Dislike (0) Reply
    Maybe the UK should sign papers stating whether it is benevolent or malevolent.
  • Tigress (12/04/2016, 16:57) Like (1) Dislike (0) Reply
    i hope the premier thought this thing through thoroughly cause there is nothing worst than a premature, forced decision.we want no shoulda-coulda-wouldas after this. Sometimes too, the path of least resistance is the way to go -as some unexpected positive results are revealed. We wait!!
  • Bernie Sanders (12/04/2016, 17:31) Like (1) Dislike (0) Reply
    The world really turns ,When Naraiga was in power in Panama he killed the offshore business and everything moved to the BVI ...Now years later the offshore business will move from the BVI to someplace else because no offshore company wouldn't want UK police in their business..Stay tune ,the Financial services will be bottom up..Everything turning on the NDP now..Unless the NDP deal with the small man properly the country will continue to fail ,stay tune my people and feel the BERN..NDP in POWER it's like GEORGE BUSH in Power and the BVI will continue to be F$$$$K..The offshore companies done start packing up check the news next week..
  • Guest (12/04/2016, 17:37) Like (2) Dislike (0) Reply
    Bye Bye FSC.....The days of plenty are now numbered....
  • Sigh (12/04/2016, 23:15) Like (2) Dislike (0) Reply
    These old idiots done did it again... just when you thought they could'nt get any more dumb!! You really think the UK give a crap about us?! They want to see us fall!!
  • John (13/04/2016, 01:30) Like (1) Dislike (0) Reply
    Financial services was already on the decline. Now this seems to be the coup de gras. Do the OECD countries have the same obligation? It seems so unfair to be singling out only the small countries. The overseas territories should have come up with a coordinated strategy instead of just rushing to sign on the dotted line.
  • Observer (13/04/2016, 02:08) Like (2) Dislike (0) Reply
    OT's are being required to provide details of beneficial ownership within one hour in urgent cases. If this facility is not provided then the fs industry will be compromised. Rules of business are changing fast. BVI must comply or die!
  • Jaqen H'ghar (13/04/2016, 07:57) Like (0) Dislike (0) Reply
    all men must serve
  • oh boy (13/04/2016, 08:15) Like (2) Dislike (0) Reply
    Here they go!
  • confused (13/04/2016, 08:34) Like (2) Dislike (0) Reply
    This certainly is a disappointing move, the beginning of the end of our financial services industry. Rather than stand firm in the agreements already in place and the sound regulatory systems already functioning, the Premier has buckled without due consultation with the industry. Who is advising our Premier. I am ashamed.
  • Position (13/04/2016, 18:34) Like (1) Dislike (0) Reply
    Good move Premier! Transparency to a certain degree is a practical, pragmatic approach to take. A win win situation.
  • Diego Penn (13/04/2016, 19:38) Like (1) Dislike (0) Reply
    I want a public register in England, France and United States of America with all the company's and generational owners from slavery to present who all benefited from the horrific slave trade of Africans along with the total of their earnings.
  • Yence (13/04/2016, 19:42) Like (2) Dislike (0) Reply
    Not good. Exodus will start with the Asians then the rest.
  • JACK BE STILL (14/04/2016, 23:55) Like (1) Dislike (0) Reply
    There's something very wrong with the basic maths behind this assumption. Once said by a great leader, "trying to tax a nation into prosperity is like standing in a bucket and trying to lift yourself up by the handles".
  • Mark (15/04/2016, 14:29) Like (1) Dislike (0) Reply
    The devils never sleep. They will continue until they destry out Financial Services Sector
  • cash register (15/04/2016, 16:15) Like (0) Dislike (0) Reply
    That's a great idea - have these registers or lists of people in the US, UK, Canada, France etc showing what people residing in those countries own and where they keep it. Perfectly fair. Everyone from Joe the pauper to Captain
    trillionaire can't have privacy any more since they think the BVI should not


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