The Matter of Beneficial Ownership is one regarding the ownership structure of companies and the identity of those who control and benefit from a corporation and that information being made open to the public or not.
The VI has in the past argued that it would readily implement Public Registers once the policy becomes a global standard.
Over the years, the Virgin Islands financial services sector has been transformed through the country opting to specialise in company formation, where financial services customers from around the world would be able to easily and quickly create new companies.
As part of the VI’s strategy, most information about ownership and management of financial services companies are hidden from public view by law and that strategy has boosted the VI’s economy into one of the biggest financial services sectors in the world amidst pressure from the UK for British OTs to implement public registers.
While Premier and Minister of Finance of the British Virgin Islands (BVI), Honourable Andrew A. Fahie (R1), has reiterated the support of the Territory’s Government towards working with the United Kingdom Government (UKG) to resolve the issue of publicly accessible registers of beneficial ownership, financial pundits believe implementation will ultimately damage the VI’s financial services sector, leading to companies shifting their business to other jurisdictions.
Calling the pressure for public registers an immoral move and a direct attack on the VI’s economy and livelihood, Skelton-Cline on the February 15, 2022, edition of his Honestly Speaking radio show, pointed to the US now using Central Registers as opposed to Public Registers.
According to Skelton-Cline, the United States, which he said was "another empire who changes the rules" to fit themselves and then tell you want they want you to do, have approved the use of Central Registers, "but they want us, in support of the EU and the UK, to have Public Registers."
In late 2020, the US government passed the National Defence Authorisation Act which included important corporate transparency reforms. As a result of this Act, the majority of companies, about 87% in the US, will have to disclose their beneficial owners to the U.S Treasury’s Financial Crimes Enforcement Network (FinCEN), although this will not be made public.
“So their Central Registers will still have their host information confidential, run by the feds, controlled by the authorities… but they want us, Tom Dick, Buddy, Harry, Jackie and Jane to have access to people's private information,” he added.
Skelton-Cline said they VI can expect to be placed on the 'Gray List' if they oppose Public Registers but it must continue to challenge its implementation and keep the people properly informed on what it is facing.
"That is why I am hoping that the leader of this country and the Leader of the Opposition, there is still an opportunity and a cause to come together and agree on a national approach on the COI Report and everything that will ensue."
UK MP Sir C. Geoffrey Cox QC, a Conservative backbencher, has already argued that the benefit of transparency would be “a one-hit-wonder” and that “money will go to where it is darkest” to other global territories where there are no public disclosure requirements.
Skelton-Cline noted that the EU is right now facing constitutional challenges regarding Public Registers but the UK is still pressing for the VI and other OTs to implement the controversial policy.
"The US sidesteps it and we still smack there. The asteroid is still headed towards us for a direct hit."
In a Financial Services update on September 22, 2020, Premier Andrew A. Fahie (R1) reminded industry practitioners that as significant milestones in the area of beneficial ownership approach, his Government is continuing to take note of developments in this sphere.
He said the VI acknowledged and recognised that the continued success of its financial services industry requires that the Territory continues to align itself with industry standards as they emerge, taking the informed and nuanced decisions required as circumstances develop.
According to the Skelton-Cline, with the US having implemented Central registers, the VI remains under the threat of Public Registers, ‘You think we can afford any drop in revenues? Because wealthy people will go wherever their confidentiality will be maintained,” he said.
The clergyman urged the Virgin Islands to act and not wait for things to happen, adding that it is in the best interest of the Uk and VI to negotiate an amicable outcome.
Meanwhile, the Virgin Islands was quick to launch a new innovative technology platform called BOSS (Beneficial Ownership Secure Search System) to share VI company information and beneficial ownership data with UK law enforcement within 24 hours.
BOSS is being pushed as the alternative to public registers as it meets all international standards as defined by the Financial Action Task Force (FATF) and provides the appropriate balance between privacy and transparency; however, it remains to be seen if the UK and EU will recognise the system and discontinue trying to enforce the harmful policy of public registers.