Property transparency has cross-party support and would be easy win for ministers

October 5, 2021 - New legislation that would unmask those who own property in Britain via offshore companies should be tabled before Christmas, Transparency International UK said today.

The draft Registration of Overseas Entities bill would close a loophole that allows individuals to buy and sell UK property anonymously by using companies registered in secrecy jurisdictions like the British Virgin Islands. The legislation should incorporate reforms to Companies House, which the Government committed to in 2020.

The call comes after the Pandora Papers, a huge cache of leaked company data, revealed the true owners of more than £4billion worth of UK real estate, which include high-profile foreign politicians, individuals accused of corruption and UK political donors.

Purchasing and owning property via an offshore company is legal, but it is also a common method used by criminals and the corrupt to move and hide illicit wealth. In its latest national risk assessment for money laundering and terrorist finance the Government raised the money laundering risk for the UK property market from ‘medium’ to ‘high’.

Duncan Hames, Director of Policy at Transparency International UK, said:

“Transparency over who really owns property here would go a long way to help solve the UK’s £100billion-a-year dirty money problem. The Government has already done much of the hard work on legislation that would lift the veil of secrecy provided by offshore companies, with a bill drafted and MPs and peers having already provided positive feedback. If ministers are serious about tackling the flow of corrupt and criminal wealth into the property market, we see no reason why this could not be tabled before Christmas.”

Notes to editors:

The UK Government committed to introduce transparency over the real owners of overseas companies holding UK property at the 2016 anti-corruption summit. The Government has drafted a Bill, which has been through pre-legislative scrutiny, and committed to introducing legislation in the December 2019 Queen’s speech.

The Government also committed to overhauling Companies House – the UK’s company registration authority – in 2000. Currently, Companies House has no power to carry out even basic checks on those forming companies here, which has made UK firms attractive to criminals in the past.