My Lords, I will not reiterate the many arguments made in Committee on the ineffectiveness of foisting public registers on the overseas territories for tax or law enforcement, but rather pay tribute to the noble Earl, Lord Kinnoull, and my noble friend Lord Naseby for making similar points to those that I would have made. Instead, I rise to make a different point.
I spoke in response to an identical amendment tabled by the noble Baroness, Lady Stern, to the Criminal Finances Bill on 3 April, memorably, as she said, one year after the Panama papers. That amendment was ultimately not moved but it has appeared by and large in the same form today. A similar amendment to the same Bill was moved in the other place regarding the Crown dependencies, which the Opposition Front Bench stated it was keener to legislate for than the overseas territories. The amendment was defeated by the substantial majority of 301 to 180. The interest of the UK, and the interest of fairness, is to achieve a level playing field between the members of the British family of territories. Clearly, it is also the intention of the Opposition Front Bench to legislate for the Crown dependencies, so that clear steer from the other place should be noted and the impact on the Crown dependencies considered. Still, much has changed even in those few months to make the call for public registers possibly less compelling.
Since then, both Crown dependencies that have been assessed by the OECD’s Global Forum—the world’s standard-setter for beneficial ownership, retention and international exchange—have been rated as among the few jurisdictions fully compliant with international standards. Indeed, they have a better rating than the UK. Moreover, since then, the overseas territories’ 2016 exchange of notes with the United Kingdom, under which they agreed to introduce government central registers of beneficial ownership, have come into effect. Those registers are accessible by UK tax and law enforcement on a same-day basis, giving the UK access to information that is unparalleled by any other jurisdiction in the world.
Even more so, partly in response to the debate in this House last year, the Criminal Finances Bill was amended to introduce mechanisms to review the effectiveness of the overseas territories’ and Crown dependencies’ registers and their exchange agreements with the United Kingdom. That amendment, now Section 9 of the Criminal Finances Act, requires the Government to prepare and lay before Parliament a report by July 2019 on the effectiveness of these new systems. This will allow your Lordships’ House to have the full evidence in front of it before taking any further steps. That was most wise. It buttresses the systems that have been adopted in the overseas territories, rather than undermining them; it meets international standards, rather than conflicting with them; and it gives the UK oversight of the overseas territories, rather than pushing them around. David Cameron
was quite right and prescient in setting out tax evasion and counter-fraud legislation as a priority, and I pay tribute to him for that prescience—long before “McMafia” was aired.
To legislate now would be to pre-empt that report, which has already been legislated for and which would greatly inform your Lordships’ House on the strengths and weaknesses that might require improvement. Moreover, by legislating now—before evaluating the overseas territories’ systems, as the Government are now required to do—the United Kingdom may jeopardise the good will and unparalleled relationship that it has with those overseas territories and Crown dependencies. I therefore urge your Lordships to show caution in the approach adopted to avoid undermining the progress that has been made. Even in difficult times, with some of the overseas territories named in this amendment having been devastated by recent hurricanes, they have made progress to remain at the fore of international standards. Let us not pre-empt the evaluation that Parliament has already compelled the Government to conduct by approving this amendment.
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