Malta is one of the EU countries that has missed the 10 January deadline for an “urgent” EU plan to end secret company ownership.
EU member states had committed to introduce “publicly available registers of companies, trusts, and other legal arrangements,” according to the European Commission.
NGO Transparency International highlighted the fact that “the majority of countries, from offshore havens like Malta and Cyprus to major economies like France or Italy, have not taken the agreed steps.”
These changes were decided upon in April 2018 to “introduce substantial improvement to better equip the Union to prevent the financial system from being used for money laundering and for funding terrorist activities,” according to the European Commission
The amendments were put in place as part of the Fifth EU Anti-Money Laundering Directive to “enhance transparency by setting up publicly available registers for companies, trusts and other legal arrangements”, “enhance the powers of EU Financial Intelligence Units, and provide them with access to broad information” and “limit the anonymity related to virtual currencies and wallet providers as well as for pre-paid cards,” among others.
On the 23 December, the International Consortium of Investigative Journalists (ICIJ) noted that Malta and other countries were “poised to miss the deadline” to implement rules which “are designed to frustrate corrupt regimes, media groups and terror funders,” according to the consortium. This action was meant to be put into place as a “pledge” by the EU following their Panama Papers investigations.
“By this date, registers are supposed to be accessible not only to tax inspectors and law enforcement but also to journalists and members of the public. Resulting disclosures are designed to cut through the complex chains of ownership that surround many anonymous companies, disclosing the ultimate individuals in charge,” the ICIJ said.
“Malta, which is currently embroiled in a massive political scandal revolving around the car-bomb murder of a journalist and dirty money claims stemming from the Panama Papers, was one of the countries (who failed to live up to the commitment),” the consortium said.
The ICIJ quoted Laure Brillaud, senior policy officer at Transparency International EU who pointed out that “despite progress made by the EU on exposing anonymous firms, campaigners at Transparency International remain concerned about an uneven commitment among member states to the more costly work of monitoring and combating of grand corruption and organised crime. They have called for a pan-European agency to be set up.”
“Meanwhile, the implementation of ownership registers across the EU has been closely watched in other parts of the world. Many offshore jurisdictions are under pressure to follow Europe’s lead, but some have said they will hold out until the EU can be seen to have followed through on its promises,” they said.