New Zealand commits to exploring the establishment of a public central register of company beneficial ownership information.
Country: New Zealand
Themes: Beneficial ownership
Last updated: December 2020
Concrete: Somewhat Concrete | New: New | Ambitious: Not Ambitious
Proactove Release by the Ministry of Justice - Setting the strategic direction for New Zealand's Anti-Money Laundering and Countering the Financing of Terrorism Regime
Minister of Justice Proactive Release
Call for feedback on what requirements there should be made on the New Zealand companies and limited partnerships to disclose beneficial owners
Ministry of Business, Innovation & Employment says final policy decisions on improved beneficial ownership information on NZ companies coming this year
Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill pg.12
Briefing for the Incoming Minister of Commerce and Consumer Affairs pg.5
New Zealand has no central register of beneficial ownership for companies or trusts. While it operates a publicly accessible Companies Register within the New Zealand Companies Office, this does not include beneficial ownership information. Foreign trusts have had to register with the Inland Revenue since 2017. This register includes information relating to beneficial ownership, but it is not publicly accessible. The Register of Companies can compel companies to provide information on beneficial owners for law enforcement purposes. The SFO can require that information on beneficial owners be provided once an investigation is underway. The Inland Revenue Department can compel companies and trusts (and others) to provide information, including aspects relevant to beneficial ownership. The Ministry of Business, Innovation and Employment has been leading work to create a register of beneficial owners. In June 2018, the Ministry of Business, Innovation and Employment released a discussion document about establishing a Public Central register of company beneficial ownership, which set out three options to increase transparency of information about the beneficial owners of New Zealand companies and limited partnerships. Submissions on the discussion document closed in August 2018. An October 2019 cabinet paper on AML/CTF refers to another Cabinet paper “Better identification of beneficial owners, directors and general partners”. It says, “If approved the changes will demonstrate to FATF that New Zealand is undertaking legislative reform to address issues relating to Immediate Outcome 5(Legal persons and Legal Arrangements). This Cabinet paper has not been publicly released.”
There has been no publicly visible action on this matter in the current year. However, officials have analysed the submissions and MBIE is in the process of developing proposals about the establishment of a register of company beneficial ownership information.
According to the NZ Tax Administration Act 1994, resident trustees of a foreign trust must disclose details of all beneficiaries and persons “with a power to control” the trust. An annual financial return must be provided to the Inland Revenue Department, including details of beneficiaries. (Check sections 59B and 59D).
Other laws to check for reference are the Companies Act 1993, the Limited Partnership Act 2008 and the Serious Fraud Office Act 1990, s. 5.
Limited progress has been made by New Zealand on this front, although interest has been indicated to progress this ahead by the Justice Minister.
Updated: April 30, 2020
The Ministry of Business, Innovation and Employment (MBIE) is in the process of seeking direction from Cabinet about establishing a register of company beneficial ownership information.
Peer reviewer: Response from New Zealand Government
Updated: October 30, 2019
Limited progress has been made therefore. Interest has been indicated to progress this ahead of the EU by the current Speaker of the House, Justice Minister and Minister Open Data.
The initial communique on measures to obtain beneficial ownership (BO) information states that the register will be “available and fully accessible to those who have a legitimate need for it, including to help prevent abuse.” This would include journalists, and also NGOs such as TI NZ, to research any particular case. New Zealand cannot rely solely on NZ Police and SFO to be sufficiently resourced and focussed on identifying anomalies on the BO Register. Journalists, advocates, investigators, auditors and NGO’s are also very important in identifying corruption and fraud related issues. Broadening the access will improve New Zealand’s ability to combat money laundering and grand corruption TI NZ also sees an opportunity for greater efficiency of Beneficial Ownership registration. Under current legislation, information is dispersed among professional service providers, and not centralized. This increases administrative burden on the micro businesses and SME that make up over 80% of New Zealand businesses. The costs to businesses of managing the beneficial ownership register could be reduced in time and cost. In contrast, a public, central register, from a business point of view, would improve efficiency. New Zealand has a similar system in place for individual identification of users utilizing government databases. (RealMe).
Peer reviewer: Response from Transparency International New Zealand
Updated: October 30, 2019
The below mentioned MBIE work was noted in the Select Committee report on the Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill, and MBIE’s Briefing to the Incoming Minister for Commerce and Consumer Affairs. Pg. 12 Twenty-nine submissions to the MBIE consultation have been received. Officials are currently analysing the submissions before making recommendations. MBIE will be working with the Minister on reaching final policy decisions in 2019.
Updated: May 30, 2019
On 19 June 2018, the Ministry of Business, Innovation and Employment (MBIE) released a discussion document seeking feedback on what requirements there should be on New Zealand companies and limited partnerships to hold and disclose information about their beneficial owners. Submissions closed on 3 August 2018. Limited progress has been made therefore. Interest has been indicated to progress this ahead of the EU by the current Speaker of the House, Justice Minister and Minister Open Data.
Updated: October 30, 2018
Limited progress has been made but as there is no deadline it is hard to measure progress. The Ministry of Business, Innovation and Employment (MBIE) is exploring the establishment of a public central register of company beneficial ownership information. At the Financial Action Task Force (FATF) meetings in February 2017, MBIE met with officials from a range of countries to better understand how other countries are exploring and implementing beneficial ownership registers. MBIE also met with officials from the UK Treasury and UK Department for Business, Energy and Industrial Strategy in London. MBIE has noted that it intends to consult with stakeholders on this issue later this year (2017).
Updated: June 30, 2018