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Financial Mirror (Cyprus) - - FRONT PAGE -

The Luxleaks tax scan­dal has upped pres­sure on na­tional gov­ern­ments to back an EU-wide pub­lic reg­is­ter of company own­ers and trusts, as part of a re­vised Anti-Money Laun­der­ing Di­rec­tive, the lead MEP on the bill has said, ac­cord­ing to the EU pol­icy and news site EurAc­tiv.

Ju­dith Sar­gen­tini, the Green rap­por­teur on the text, said the rev­e­la­tions over Lux­em­bourg’s in­dus­trial scale tax avoid­ance could en­cour­age coun­tries op­posed to the reg­is­ter to change their minds.

She was speak­ing at an event or­gan­ised by NGOs to call on the Par­lia­ment to stay firm on the reg­is­ter dur­ing trilogue ne­go­ti­a­tions with the Coun­cil of Min­is­ters.

Sup­port­ers at the event - in­clud­ing Ox­fam In­ter­na­tional, Trans­parency In­ter­na­tional, the Fi­nan­cial Trans­parency Coali­tion, One, and the Euro­pean Net­work on Debt and De­vel­op­ment - ar­gue a pub­lic reg­is­ter will be­come a vi­tal tool in the fight against multi­na­tional tax avoid­ance. The reg­is­ter was in­tro­duced by MEPs as an amend­ment to the bill.

Euro­pean Com­mis­sion Pres­i­dent JeanClaude Juncker has come un­der pres­sure be­cause he was Lux­em­bourg’s prime min­is­ter at the time when the Luxleaks deals were made. His Com­mis­sion is in­ves­ti­gat­ing Lux­em­bourg over its tax pol­icy.

At the event, Vi­taliy Shabunin, the head of board of Ukraine’s Anti-cor­rup­tion Ac­tion Cen­tre, told EurAc­tiv that the Luxleaks scan­dal had the po­ten­tial to dam­age Ukrainian trust in the EU.

Por­tuguese So­cial­ist Ana Gomes, chair­ing last week’s event in the Par­lia­ment, said the con­tro­versy could force Juncker to bring in last­ing re­form on tax is­sues.

“It’s now or never, es­pe­cially be­cause of this pres­sure. That’s why I am against calls for him to re­sign […] if you want to go after a poacher, you hire a poacher,” she said.


MEPs and Coun­cil of­fi­cials met on Tues­day in Stras­bourg to con­tinue those talks. Both sides must agree an iden­ti­cal text be­fore it be­comes law. The Euro­pean Com­mis­sion sits in on the talks.

The ne­go­ti­a­tion will likely in­volve is­sues sur­round­ing the def­i­ni­tion of high risk gambling in the con­text of money laun­der­ing, and data pro­tec­tion.

But Sar­gen­tini stressed that ev­ery­thing was still up for dis­cus­sion, in­clud­ing the reg­is­ter.

“Luxleaks has put tax is­sues into the spot­light,” she said, “I think that will con­vince mem­ber states who are against the reg­is­ter to try and find a way for­ward.”

The Lux­em­bourg tax leaks ear­lier this month ex­posed how the Duchy cut deals with global com­pa­nies, al­low­ing them to save bil­lions on tax bills.

Ag­gres­sive tax plan­ning, where cor­po­ra­tions move money around their sub­sidiaries in dif­fer­ent coun­tries to legally min­imise their pay­ments, was al­ready high on the agenda of pol­i­cy­mak­ers keen to raise much needed rev­enue after the fi­nan­cial cri­sis.

Swe­den had al­ready changed its po­si­tion to be­ing in favour of the reg­is­ter, Sar­gen­tini said. Den­mark also sup­ports the ini­tia­tive.

The Dutch gov­ern­ment is against the reg­is­ter, de­spite the Dutch par­lia­ment call­ing for one in a vote. Sar­gen­tini said that the Par­lia­ment was “ashamed” after it was re­vealed that the son of for­mer Ukraine Pres­i­dent Vik­tor Yanukovich had stashed money in a Dutch shell company based in The Hague. Malaysian Air­lines Flight 17 was shot down by Moscow-backed rebels in Ukraine, killing 198 Dutch na­tion­als.

The UK backs a reg­is­ter for com­pa­nies, but not for trusts. A Bri­tish diplo­mat at the event hinted that the Bri­tish could put for­ward “new lan­guage” in a bid to win a com­pro­mise deal.


The Anti-cor­rup­tion Ac­tion Cen­tre in Ukraine ran a web­site ex­pos­ing Yanukovich’s op­u­lent palace, and use of shell com­pa­nies in the EU.

Vi­taliy Shabunin told del­e­gates that Ukraine had in­tro­duced its own pub­lic reg­is­ter of ben­e­fi­cial own­ers and called for an EU pub­lic reg­is­ter of real es­tate as­sets as well.

“The key in­stru­ment of cor­rup­tion in Ukraine is the anonymity of com­pa­nies […] but with­out open reg­is­ters in the EU, our reg­is­ter makes no sense,” he warned.

Se­bas­tian Fiefler, vice chair of the Bund Deutscher Krim­i­nal­beamter (Ger­man po­lice as­so­ci­a­tion), was also at the event. He added that the EU-wide reg­is­ter would also be a vi­tal tool for fight­ing money laun­der­ing and or­gan­ised crime.

Juncker faces a Par­lia­ment vote of cen­sure over the scan­dal on Thurs­day.

On Mon­day, he was sup­ported in the Par­lia­ment by the two largest po­lit­i­cal groups, the Euro­pean Peo­ple’s Party and the So­cial­ists & Democrats, as well as the lib­eral ALDE group.

The mo­tion was brought by par­ties in­clud­ing the UK In­de­pen­dence Party and France’s Na­tional Front.

Ju­dith Sar­gen­tini with the “Rus­sian dolls” of the One cam­paign for a pub­lic reg­is­ter of company own­ers. The dolls high­light how shell com­pa­nies of­ten re­veal another smaller shell company

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