Canada lags as EU ends corporate secrecy

Publicizing ownership meant to fight tax evasion and money laundering

While Canada holds meetings and talks about it, the EU has officially ended corporate secrecy. The anonymous and numbered companies that facilitate tax evasion and money laundering in Europe will soon have their ownership published in public, online registries for all to see.

Eighteen months after the U.K. established the world’s first public “beneficial ownership” registry, the EU declared on Friday that it will follow suit, citing the Panama Papers leak as having prompted the move.

“The EU has made a major breakthrough tonight in the fight against money laundering by getting the beneficial owners of companies out of the shadows,” said Laure Brillaud, anti-money laundering policy officer at Transparency International EU.

EU member states will have to put the names of those who own companies registered in their countries into a public, searchable, online database — and they have 18 months to do it.

Contacted for comment, the federal finance ministry said it “takes note” of the EU registry.

“What the EU is doing is a very significant step. This practice has to come to North America,” said Richard Leblanc, a professor of corporate governance at York and Harvard universities.

“One should not be able to hide behind a web of numbered companies without disclosing true ownership.”

In Canada, secrecy around corporate ownership makes it possible to register a corporation, open a bank account and send and receive money overseas all without disclosing one’s name — the same kind of secrecy offered by traditional tax havens.