10 DOWNING STREET
LONDON 

l'

14 November 2013
THE 

I wrote to you just over six months ago, ahead of the May European Council,
emphasising the need to inject the political will necessary to tackle the serious
global challenges of tax evasion and corporate secrecy. Since then, good
progress has been made across this agenda through the G8, the 620 and the
continued efforts by the "European Union under the Irish and Lithuanian
Presidencies. 

However, our work is far from ?nished. Europe must now, through the
4th Money Laundering Directive (MLD), visibly lead globalefforts to strengthen
transparency of company bene?cial ownership. As you know,_I put this issue at
the heart of the G8 Presidency this year because of the overwhelming
evidence behind the need to act. Put simply, a lack of knowledge about who
ultimately owns and controls companies facilitates illicit domestic and
cross-border money laundering, corruption, tax evasion and other crimes.

There is growingvmomentum building behind action on the issue. G8 Leaders
agreed in June that companies should be required to obtain and hold adequate,
accurate and current inforniation on their bene?cial ownership. The UK
strongly supports this very same commitment in the European Commission?s
MLD proposal. And I was pleased that G20 Leaders yewed to lead by example
in ensuring that the relevant Financial Action Task Force standards in this area
are met. 

Speci?cally, the-UK-comrnitted in June to hold company bene?cial ownership
information in a central registry, and to consult on whether this information

-- should be publicly accessible. After listening carefully to businesses, NGOs,
technical experts and other. groups, I announced two weeks ago that the 
central register of bene?cial ownership will be open to the public. concluded
that a publicly accessible registry provides the best outcome for sound corporate
behaviour; more effective law and tax enforcement; and for helping authorities,
including those .in developing countries, prevent misuse of companies for illicit
purposes. 1

I believe this will prove a signi?cant step towards breaking through the walls of
corporate secrecy. But as I warned earlier this year, illicit ?nance is a global
problem that can only be addressed effectively through collective action. I hepe
other Governments will join the UK in making an even bigger difference by
taking swift action on company bene?cial ownership. In Europe, our ?rst
collective step should be to mandate, through the MLD, the establishment of
public central registries of company bene?cial ownership as the cutting-edge
benchmark for countries and major ?nancial centres to emulate across the
world. Central registries will not only enable law enforcement and
tax authorities to access, discreetly and at short notice, critical information for
cross-border investigations; public scrutiny of this information tbrOugh public
registries will also increase the likelihood of inaccuracies and omissions being
identi?ed and recti?ed.

But as we clamp down on the misuse of companies, we must take care not to
displace illicit activity ?elsewhere. Currently, authorities are gaining access to
more information than ever before on trusts, especially off-shore trusts, through
the automatic tax information agreements being concluded by UK and other EU
countries. To tackle tax evasion and prevent the misuse of trusts, the EU must 
continue supporting efforts by OECD and G20 countries to agree a new single
global standard on automatic tax information exchange by next February. .

I know some want Europe to go even further to prevent the abuse of trusts and
related private legal arrangements. It is clearly important we recognise the
important differences between companies and trusts. This means that the
solution for addressing the potential misuse of companies such as central
public registries may well not be appropriate generally. Nonetheless, as
Europe leads from the front on company beneficial ownership, I look forward to
looking properly at the arguments around trusts and other legal arrangements in
order to determine what ?irther action we might take.

I am copying this letter to the President of the European Commission, the
President of the European Parliament and other members of the European
Council.

Um,
I Emu/l

His Excellency Mr Herman Van Rompuy