Minister of Energy and Business Development Kerrie Symmonds is casting some of the blame on Governments over the years and the global business sector for Barbados being cited by international agencies for non-compliance specifically as it relates to the sharing of information.
He admitted to the slow, inefficient and costly processes that have been hindering Barbados’ ability to comply with international requirements regarding access to, and reporting on, beneficial ownership information.
It is against this background, that he insisted that the setting up of a dedicated beneficial ownership register should take place as a matter of urgency.
Addressing a Barbados International Business Association (BIBA) business luncheon on Wednesday at the Savannah Beach Club, under the theme The Road Ahead for Global Business in Barbados, Symmonds expressed disappointment that the issues relating to beneficial ownership have not been ironed out despite years of concerns.
Asking the room of global business industry operators not to be upset with him, Symmonds said “We invite negative reflection on ourselves if we see a problem. We accept that it is a problem, but we choose not to fix the problem but wait for somebody to come and tell us that it is a problem, and we have to do something about it.
“In this particular regard, I cannot fault those oversight agencies who would put us on lists that are unfavorable if something as simple as this can be rectified only by a bit of effort on our part to face it and fix it and wrestle it to the ground, and that is my position.
“In my judgment there is no good reason why we should continue to play Russian roulette with standard setting bodies on matters which we can deal with and treat to ourselves in a decisive way,” said Symmonds.
“Every time that the OECD or the financial action task force has reflected negatively on us it is because they have not been satisfied and they can only be satisfied by us that our system allows for us to be able to adequately monitor the number of companies that we have on the register,” he added.
The Financial Action Task Force (FATF) seeks to deter and prevent the misuse of companies, trusts, foundations and other legal entities from engaging in money laundering, corruption and other illegal activities. Countries are required to meet certain standards on transparency and beneficial ownership.
According to FATF, a beneficial owner refers to the natural person(s) who ultimately owns or controls a customer and/or the natural person on whose behalf a transaction is being conducted. It also includes those persons who exercise ultimate effective control over a legal person or arrangement.
As part of the requirement, the intergovernmental organisation maintains that “countries should ensure that there is adequate, accurate and timely information on the beneficial ownership and control of legal persons that can be obtained or accessed in a timely fashion by competent authorities”.
Putting forward his case for the establishment of a beneficial ownership register in Barbados, Symmonds pointed out that the Corporate Registry “had a lot of work to do” and not enough resources to do all that is required with the collection and sharing of beneficial ownership information.
Noting that Government should be prepared to “hold up the mirror and scrutinise” itself, Symmonds said in addition to limited human resources there was “the issue of efficiency, the issue of the speed with which we do business, the issue of economy of cost, not only for you in the private sector, but for us in Government, and the issue of economy of effort on both sides, an absolutely critical matter that we have to confront”.
“I want to say to you candidly that it cannot be business as usual, and for a number of very good reasons,” said the minister.
The Companies Act currently requires that beneficial ownership information be held by the company’s registered office. The Corporate Affairs Registry has the task of pursuing the companies for the beneficial ownership information, carrying out the necessary risk rating exercise and deploying supervisory mechanisms based on the level of risk found.
However, indicating that there were some 40,000 firms on the register in Barbados, many of which had “a plurality of companies”, he said this meant there would be “myriad locations” where there is beneficial ownership information being held.
“Now, the Financial Action Task Force, the OECD, the EU, everybody has come to an agreement that beneficial ownership information is absolutely critical if we are going to be seen as a jurisdiction that is seriously doing financial services business,” said Symmonds.
Pointing out that Barbados was doing the collection of beneficial ownership information the same way for the past quarter century, Symmonds said establishing a dedicated beneficial ownership registry would result in more accurate and timely collection of the information noting that failure to do this could result in a penalty for non-compliance.
Cabinet has already accepted and agreed on the policy paper for the establishment of a beneficial ownership registry. This type of registry will require legislation for its establishment and to ensure protection of information.
Symmonds said having this in place meant that the Corporate Affairs Registry would be “freed up from some of the administrative burden that it now has to deal with and is able to deal with some of the other things that we all know we wanted to be able to do.”