International Financial Law Prof Blog

Editor: William Byrnes
Texas A&M University
School of Law

Tuesday, March 31, 2015

Central Registries of BVI and Cayman Corporate Ownership?

S630_HMRC_sign__media_library__960_Reuters reports that the British government has ordered BVI and Cayman Islands to set out timetables for implementing a central register of companies revealing corporate ownership, in a bid to help combat tax evasion.  The previous 4 February BVI official response is available here

On 17 December the EU announced that it reached agreement for such for each of its members, via the 4th AML Directive.

What About Delaware's Corporate Secrecy?

Professor William Byrnes stated, “The US has a highly successful international financial service industry that is important to the US economy, exemplified by, firstly, the international financial centres such as Miami and New York) of over a half trillion dollars of foreign deposits of high net wealth individuals whom many experts allege are not tax and exchange control compliant in their home countries; secondly, over 900,000 Delaware companies is the second to Hong Kong, and ahead of British Virgin Islands (BVI is actually third in the world);[1] and thirdly, the US territories’ offshore regimes, reducing the effective US corporate and income tax rates below 3.5 percent.[2]

In 2011, 133,297 businesses incorporated in Delaware.  Delaware has more corporate entities than people, reports Leslie Wayne of the New York Times — 945,326 to 897,934. These absentee corporate residents account for a quarter of Delaware’s total budget, roughly $860 million in taxes and fees in 2011.[3]  Moreover, the economic spill over impact for Delaware includes substantial employment and professional fees to Delaware business participating in the incorporation and advisory industry. Delaware is just behind China’s Hong Kong in number of annual incorporations and overall incorporations, and well ahead of the UK’s Virgin Islands (British) both in terms of offshore business and the dollars earned from that offshore business.

Transparency & Trust:  Enhancing The Transparency  Of UK Company Ownership  And Increasing Trust In UK  Business (April 2014)

Asset Recovery Guides (World Bank Star Program)


[1] “Storm Survivors”, Special Report: Offshore Finance, The Economist, 16 Feb 2013. Available at http://www.economist.com/news/special-report/21571549-offshore-financial-centres-have-taken-battering-recently-they-have-shown-remarkable (accessed 28 February 2014).

[2] See William H Byrnes and Dr. Robert J Munro, Tax Havens of the World, US Virgin Islands chapter, LexisNexis.

https://lawprofessors.typepad.com/intfinlaw/2015/03/central-registries-of-bvi-and-cayman-corporate-ownership.html

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