Foreign firms that own property in the UK will have to declare their true owners under a transparency proposal announced by David Cameron. Mr Cameron pledged last year to stem the “dirty money” and “plundered or laundered cash” flowing into British properties, more than 100,000 of which are owned by offshore companies.
Pressure for significant progress increased following the recent Panama Papers revelations, and as the Prime Minister attempts to lead a wider effort to crack down on global corruption, hosting an international summit on corruption in London this week.
Under the proposals, any company wishing to buy property in the UK, along with those that already own property, will have to complete the register, as will any business wishing to apply for a government contract.
The government did not say how the measure would be implemented or whether there would be penalties for non-compliance, however in a further move to clean up the housing market, Mr Cameron said he was looking at “reversing the burden of proof, so that if we suspect people of using stolen money to buy property we can force them to prove they accumulated their wealth legitimately – or they will face having it stripped from them by a court”.
It is thought the reforms could have extensive consequences for offshore owners and are likely to be unpopular with secretive Russian and Chinese oligarchs with anonymous UK property interests.
Lysis Financial is a specialist Governance Risk and Compliance consultancy operating in the global financial markets. Lysis Operations (incorporating Lysis Academy) is a specialist provider of AML business processing services to the global financial markets.
By Jonathon Wallis, Consultant, Lysis Financial Ltd.