Tuesday

15th Oct 2019

States keen to protect identity of Europe's shadow rich

EU states are trying to stop the general public from finding out who really owns what in Europe’s offshore firms, trusts, foundations, and other opaque structures.

The anti-money laundering directive (AMLD) is entering the final stage of negotiations on Tuesday (16 December) in Brussels in so-called trialogue talks between MEPs, diplomats, and European Commission officials.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

It's designed to clamp down on tax evasion and organised crime.

Some campaigners say it could also have strategic consequences by exposing the scale of corruption in EU neighbouring countries, such as Russia.

The European Parliament wants national governments to set up a publicly accessible register on “beneficial ownership”.

“We are doing everything that we can to have that through in the final text of the directive,” Latvian centre-right deputy Krisjanis Karins, one of the assembly’s two lead negotiators, told EUobserver.

But a leaked compromise text, seen by this website, indicates that a blocking majority of member states is keen to maintain a veil of secrecy.

They don’t oppose creating the register. But they insist on restricting access to “competent authorities”, such as national Financial Intelligence Units (FIUs).

The commission’s proposal is to restrict access, but to let people who can demonstrate a “legitimate interest” - such as investigative journalists or NGOs - see the registry as well.

Tamira Gunzburg, the Brussels director of the One campaign - a pro-transparency pressure group - said Austria, Croatia, Denmark, France, Finland, Slovenia, Sweden, and the UK back public access.

But Germany, Poland, and Spain oppose it, while the commission doesn’t have a vote.

Some countries want the register to give the name and date of birth of the owner, while others also think this is too much.

Meanwhile, there is uncertainty on how to close loopholes on trusts - among the most tricky of the “discretionary structures” used by people to hide their wealth.

“The momentum for transparency is growing every day,” Gunzburg noted.

At the same time, Karins said "it's not quite clear in the end how trusts will or will not be directly handled in this directive … ideas are simple, cheap, and easy, but actually finding the language which casts the net properly is a challenge."

LuxLeaks

Pressure is mounting on the EU to do more after media revelations of tax-dodging schemes in Luxembourg.

Leading journalists from 23 countries last week wrote to commission chief Jean-Claude Juncker, a former Luxembourg PM, to take action after the “LuxLeaks” scandal.

He responded to say he backs the AMLD register, but repeated the commission line that only people with a “justified legitimate interest” should get access.

The parliament’s Karins noted the AMLD and LuxLeaks cover different ground.

“This directive is really about money-laundering and terrorism financing, whereas LuxLeaks is a tax avoidance issue which raises serious questions about competition,” he explained.

But he said the Juncker furore has come up in the AMLD trialogues in terms of political atmosphere.

MoscLeaks?

For her part, Elena Panfilova, the Moscow head of Transparency International, a European NGO, believes corruption also has a strategic meaning.

On one hand, state embezzlement in Russia has depleted the Kremlin’s rainy day fund and its ability to resist EU and US sanctions.

But on the other hand, clandestine Russian money is being used to influence European companies, politicians, and media.

Panfilova told EUobserver that if the general public in Russia could see how much of their taxes the nomenklatura has stashed in Europe it would harm Vladimir Putin’s popularity.

It might also help to rein in the administration’s greed.

“A strong AMLD is one of the most important contributions the EU could make to reform and rule of law in Russia”, she said.

“The missing money means schools not funded properly, hospitals not built. For Russian people it’s not funny money, it’s literally killing them”.

EU tax havens drain money from developing nations

Tax havens in places like Luxembourg are zapping billions of euros from the coffers of developing countries and forcing weak governments to rely on dwindling international development aid, experts say.

Belgium's EU nominee still embroiled in legal feud

Cache of 18 secret documents and allegations of death threats in fresh legal complaint surrounding Belgium's EU nominee, Didier Reynders, shortly after a low-level prosecutor cleared his name.

EU sides with Google in data protection case

The European Commission suggests the French data protection watchdog overstretched its remit to make Google delist names on a global scale from search query results, as part of the 'right to be forgotten' rule in the EU's data protection regulation.

Stalling on VAT reform costing billions, says Commission

German media outlet Correctiv, along with other newsrooms, have revealed how criminals annually cheat EU states out of billions in VAT fraud. The EU Commission says solutions exist - but member states refuse to budge on tax unanimity.

Stakeholders' Highlights

  1. Nordic Council of MinistersBrussels welcomes Nordic culture
  2. UNESDAUNESDA appoints Nicholas Hodac as Director General
  3. UNESDASoft drinks industry co-signs Circular Plastics Alliance Declaration
  4. FEANIEngineers Europe Advisory Group: Building the engineers of the future
  5. Nordic Council of MinistersNew programme studies infectious diseases and antibiotic resistance
  6. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  7. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues
  8. Nordic Council of MinistersNo evidence that social media are harmful to young people
  9. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  10. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  11. Nordic Council of MinistersEducation gets refugees into work
  12. Counter BalanceSign the petition to help reform the EU’s Bank

Latest News

  1. EU countries to halt arms sales to Turkey
  2. Nine Catalan separatist leaders given long jail terms
  3. Poland's right-wing ruler wins four more years
  4. EU powerless in new Syrian mayhem
  5. Hungarian opposition wins Budapest in blow to Orban
  6. New Dutch terror bill must not target aid workers
  7. EU proposes pesticide ban, but key documents still secret
  8. Brexit nail-biter and EU nominations This WEEK

Stakeholders' Highlights

  1. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  2. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  3. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  4. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat
  5. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  6. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  7. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  8. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  9. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  10. Nordic Council of MinistersNordic commitment to driving global gender equality
  11. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  12. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria

Join EUobserver

Support quality EU news

Join us