News

Central Public Register of Isle of Man Beneficial Owners of Isle of Man Companies

Nick Kelly

Intro

The Isle of Man currently has a central register of Ultimate Beneficial Owners (“UBO”) of Isle of Man registered companies.

Each company has a Nominated Officer or Corporate Service Provider (“CSP”) charged with keeping the details of the company’s UBO(s) up to date on an annual basis using an online portal.

The register, maintained by the Isle of Man Companies Registry, is only accessible by request and only to local tax and legal authorities.

Separately, the Isle of Man Companies Registry also maintains records of Isle of Man Companies’ registered shareholders, collected on annual statutory returns of 1931 Act companies filed each year.

The annual returns of 1931 Act companies list all registered shareholders, although the ultimate ownership may be obscured by using a nominee company for privacy reasons or to simplify administration of the company.

2006 Act companies need not provide information on their registered shareholders, although currently have the ability to elect to do so if desired.

What?

Once implemented, the new register will allow a much greater level of access to the same UBO information.

Tax and legal authorities will have unhindered access as will financial services business and other “permitted businesses” who are expected to use the facility to enhance their due diligence procedures and, ultimately, access will be open to the public.

When?

The new register will be phased in, initially starting in 2021 when access to tax and legal authorities will be made available via a connected registry with Guernsey and Jersey.

No later than the end of 2022 the Islands have committed to granting access to financial services and other “permitted businesses” by which time legislation is expected to have been put forward to create public access.

Why?

It is generally believed in certain quarters that making UBO information open to the public that this will reduce the likelihood of money laundering by acting as a deterrent.

Unfortunately, at the same time, it does appear to infringe significantly on the rights of law-abiding, tax paying persons who use nominee shareholders legally for privacy and security purposes and seems to contradict the recent introduction of GDPR laws focusing on protecting personal data.

Its effectiveness is yet to be seen but it would appear to rely heavily on the quality of data collected by the Nominated Officer or CSP filing the information.

Who?

In simple terms, UBOs are considered to be individuals who own or control 25% or more of a company, be that via a collection of group companies or directly held shares.

Therefore, anyone holding an interest of this nature and size in an Isle of Man company, is likely to be a registerable UBO and find that their details become publicly available. Exactly what details will be made public is not yet known.

Peregrine Corporate Services Limited is licensed by the Isle of Man Financial Services Authority.