MNI View: The UK Shows True Colonial Disrespect by Imposing Restrictive Beneficial Ownership Laws on Overseas Territories

MNI View: The UK Shows True Colonial Disrespect by Imposing Restrictive Beneficial Ownership Laws on Overseas Territories

Protest March in Tortola against new beneficial Ownership Law Imposed from the UK

MNI Media is of the view that neo-colonialism is alive and well. The imposition of laws on British Overseas Territories (OTs) from the United Kingdom wreaks of a tarnished relationship; where false declarations of equality were embraced by one side, yet the other side who still maintained its bravado of superiority always knew that in the final analysis, what it says goes and that is the end of that.

Here we are in this modern era of colonial relationships where the United Kingdom has decided to impose on its Overseas Territories a law requiring Public Registers of Beneficial Ownership as part of their UK Sanctions and Anti-Money Laundering Bill

MNI Media most certainly is in favour of the rule of law, and efficient regulations to combat corporate crime. We are not at all saying that regulations, proper compliance and accountability measures do not need to be in place as it regards offshore financial centres. However, what concerns many is that this recent imposition of a Public Register of Beneficial Ownership on the OTs has serious implications for the territories and does not send a message of co-operation.

Recently, in the British Virgin Islands, both citizens and government officials have taken to the streets to denounce what they see as a colonial dictate by its very concept, and by its heavy-handed reach into the jurisdiction of a sector that has enormous economic benefit for the islands.

In a report written by Capital Economics and published by BVI Finance, it is estimated that “$1.5 trillion worth of assets currently move through the BVI."

Capital Economics further goes on to declare that the BVI is a "sound and reliable centre which has worked harder than many bigger nations to meet international standards, and not some supposed tax haven."

Furthermore, what is even more frightful via the imposition of this law on the OTs is that places such as the BVI have bent over backwards to meet international standards of compliance by implementing countless regulatory reforms. Prime Minister Orlando Smith of the BVI speaks of recently spending US$2 million on developing a beneficial ownership platform accessible by U.K. law enforcement authorities. One that is very much similar to that used by the Cayman Islands. 

What of the other British Overseas Territories, how will this move by the UK affect them?
Many OT leaders have stated their utmost displeasure at this imposition and have opined very clearly that they already have measures in place to combat financial crime and money-laundering that adhere to established international standards as like the BVI's PM has stated.

What MNI Media wonders, is, who are these people behind the politicians that pushed for this law?

It is not lost on MNI Media that it would appear that some quarters of the international financial community are very dissatisfied that business is being lost in already established financial centres such as Isle of Man, Guernsey et al, and now that these funds are moving to developing nations, helping their economies to grow and bringing access to opportunity for a wide cross-section of citizens, that now the elite governments of the global financial centres seem to have a problem with it.

MNI Media understands that the European Union (EU) had already put forward policy decisions that made beneficial ownership registers public through their 5th Anti-Money Laundering Directive. What we have uncovered here at MNI Media is that even though this has not yet become international standard, the most critical factor, as has been outlined via the work in this area done by the OECD Global Forum, is that information contained on these registers is "adequate, accurate and current for the purpose of law enforcement." In fact this very same Forum has established that no hard impartial evidence exists that public registers assist in the prevention of financial crime.

So why is the UK so hell-bent on this level of infringement?

Let us go back and examine the roots of the Bill, but more so the very strong colonial sentiments that still exists in Mother Country.

Colonialism on Both Sides of the House of Commons?
It was now present Labour Party leader in the UK, Jeremy Corbyn, who stated openly prior to the last general election in the UK that “The UK government should consider imposing direct orders on British Overseas Territories and Crown Dependencies to stop them acting as tax havens”

Corbyn went as far as to accuse UK Prime Minister May of ‘pussyfooting” on tax matters.

The boldness of Corbyn’s colonial flirtations went as far as to state that the UK government should put it to administrations in British Overseas Territories such as the Cayman Islands and British Virgin Islands; “Hang on, you are a government of a British dependent territory, a crown territory, you must obey UK tax law, you must not become a harbour for tax avoidance and tax evasion.”

In a piece in the UK’s Guardian, it gives reference to Corbyn stating "that there was precedence for direct rule to be imposed….and it should be done."

Quoting from The Guardian, MNI Media can further point out where Corbyn said; “The point is that they are not independent territories. They are self-governing, yes, but they are British crown dependent territories. Therefore, surely, there has to be an observance of UK tax law in those places…..If they have become a place for systematic evasion and short-changing the public in this country, then something has to be done about it. Either those governments comply or a next step has to be taken.”

As we looked more deeply into colonial impositions on the UK’s overseas territories, it was noticeable that the UK has tried in the past to impose their ideals via high-handed laws on the OTs. This has come via such measures as “human rights issues to do with abolishing capital punishment; the decriminalization of homosexuality, or in response to major governance failure such as temporary direct rule on the Turks and Caicos Islands (TCI).”

Who is Margaret Hodge?
Margaret Hodge is a UK Member of Parliament who sits on the Labour side. She is a major force behind this new Bill. Hodge is a corporate governance hawk. She is the Member of Parliament for Barking, and has authored a book titled “ Called to Account: How Corporate Bad Behaviour and Government Waste Combine to Cost us Millions”

As a sponsor of this new Bill that is being imposed on the OTs she stated; “of course political parties have shied away from using these powers. They can seem somewhat colonial, but I think there are overwhelming moral arguments at stake here.”

The fact is there is always need for proper compliance, but the research has shown that the OTs have passed international standards of regulation, so why did the UK need to bring this Bill forward?

In addition, MNI Media asks, that after the near neglect of the UK to many of its OTs that were ravaged by the 2018 major hurricanes, is the timing of this Bill not a bit suspect?

For a wealthy country like the UK to have such open self-declared public registers is a walk in the park for them to establish, as the costs to the UK’s purse would be minimal.

However, for these OTs which are quite frankly still classed as “developing countries” the expense to set up this public register will be burdensome. Not to mention the harm it will do to these offshore sectors who pride, as part of their attraction, the desire for privacy for those who may not wish their finances be public to all.

The need for financial privacy does not automatically equate to financial crime and wrongdoing by the OTs. The UK’s colonial imposition on the OTs is one that is not welcomed. There are more poignant ways in which the UK should be working equally as hard to help its OTs, such as Montserrat and Anguilla to advance.

So the questions is for the OTs, where to now?


Note: Jeevan A. Robinson is Editor-in-Chief of Marketing, News & Information Media (MNI Media). He can be reached at jeevan@mnialive.com