THE DEPARTMENT OF Finance will this morning be licking its wounds after Dublin lost its bid to be home to the EU’s new Anti-Money Laundering Authority.
Experts say however, that the decision was not entirely unsurprising given serious concerns that exist about Ireland’s record on corporate transparency.
Transparency advocates have said that Ireland needs to quickly update rules that essentially shut down access to information on company ownership if it wants to be taken seriously when it comes to corporate accountability.
What they are talking about is called the Register of Beneficial Ownership (RBO), which was put in place following an EU anti-money laundering directive in 2018.
It sounds very technical but the register is a really important resource for journalists and others when it comes to accessing information on who owns and runs companies in Ireland.
Or at least it used to be.
As the RBO was accessible to everyone, it helped not just those working on anti-money laundering efforts but journalists and any member of the public who wanted to know more about the real ownership of a company.
Transparency International Ireland’s head of policy and research Alex Chance explained to The Journal that it was of use to renters who wanted to know who was behind the seemingly faceless company that owned their building.
It was even useful for environmentalists who wanted to discover who controlled companies involved in harmful environmental practices.
This was all great until public access was cut back in 2022 following a decision by the EU Court of Justice.
The court ruled that only those with a “legitimate interest” in tackling money laundering or terrorist financing could access beneficial ownership registers across the EU.
Different EU member states interpreted the ruling in very different ways, with Ireland falling on the extreme end.
The Irish state was quick to suspend public access to the register whereas countries like Latvia and France maintained public access to their registers in order to uphold corporate transparency.
Following Ireland’s suspension of public access in 2022, the Government last year went even further and introduced a law that Chance says makes it “virtually impossible” for journalists or civil society to access the registers for any meaningful purpose.
Since then the change has largely gone unnoticed in the main, but recently pressure has been ramping up on the Government and Finance Minister Micheal McGrath to return to a more transparent system.
Earlier this month, Social Democrats TD Catherine Murphy raised the issue in the Dáil and asked if McGrath would consider amending the Irish legislation to bring it into line with other EU countries.
Murphy told the Dáil that she was aware of companies that she did not believe were the beneficial owners receiving contracts from Government departments.
There are companies within companies within companies like a Russian doll.
“People will misuse the system because they know they are being sheltered,” she said.
Murphy added: “We cannot have accountability if we do not have transparency.”
After some back and forth, the minister committed to Murphy that he would ask for the Irish legislation to be reexamined.
McGrath also made the point that this is an area where policy is developing quickly and noted that a provisional agreement on a new EU anti-money laundering package was recently made in Brussels.
These measures clarify that journalists, civil society and other members of the public with a legitimate interest in tackling money laundering will be able to access registers of beneficial ownership.
Like the Social Democrats, Transparency International Ireland will also be asking the Minister for Finance to urgently amend the law brought in last year and to bring Ireland into line with this recent Brussels package.
“It’s impossible to hold any organisation accountable if you don’t know who controls or benefits from it. The legislation needs to provide genuine access for those with a legitimate interest,” Chance told The Journal.
He said if Ireland is to be taken seriously as a world leader in corporate accountability as well as in the fight against money laundering, the Government needs to show that it takes transparency seriously.
“It can do this by following the example of our counterparts in Latvia and elsewhere by re-opening our corporate registries to the public and allowing them know who are the real owners of Irish companies.”
To embed this post, copy the code below on your site
have your say