The Chief Minister, Hon. Howard Quayle MHK has this morning delivered an urgent statement to the House of Keys:
Mr Speaker, Honourable Members,
Thank you for allowing me the opportunity to address the house at such short notice today.
On Sunday night I left for London so that I could speak to contacts in Westminster regarding proposed amendments to the United Kingdom's Financial Services (Implementation of Legislation) Bill, which were, in the opinion of our Government, wholly unconstitutional. The bill was ultimately deferred by the UK Government late yesterday morning, thereby avoiding the risk of the UK's democratically elected Parliament legislating for the Isle of Man without our consent.
As I said in the joint statement with Jersey and Guernsey yesterday, this deferral provides us with the opportunity to undertake real and meaningful engagement with the UK Government regarding public registers.
As a crown dependency along with Jersey and Guernsey, we are not represented in the UK Parliament. It is therefore a long standing convention that the UK does not legislate on domestic matters for crown dependencies.
The amendments proposed without consultation with us and specifically without our consent were unconstitutional, unworkable and in the opinion of our Government unenforceable. If passed, we may have been left with no alternative but to challenge the legislative provisions before the Courts.
Honourable Members, as a Government we do wholeheartedly endorse the aims of the MPs who proposed and supported the amendments to the Bill in the House of Commons yesterday. These were designed to tackle money laundering and financial crime on a global scale. Every day law enforcement authorities in the Island work with international partners with the aim of robustly tackling money laundering and related financial crime. Over the past few years this Government has invested millions of pounds in developing and improving our ability to join the fight in this arena. Indeed just a few weeks ago, further money was pledged in the budget for asset recovery, financial intelligence and economic crime investigation. Our commitment is clear and continuing.
On Sunday, I forwarded you a copy of the letter that I sent to a number of MPs. The letter showed that the issues around the introduction of public beneficial ownership registers are complex and that currently there is an absence of global standards in this area.
We recognise that the UK has taken its decision to adopt and implement a form of public register. However, currently within EU member states, the adoption of legislation to introduce and commit to public registers, in line with the 5th Money Laundering Directive, has been markedly slow. The majority of EU countries are a long way from having working public registers of beneficial ownership.
Therefore, there is no EU Member State or internationally recognised model of public register which provides the required standard of accuracy in addition to balancing concerns regarding privacy and the safety of individuals' data. However, there must be no doubt that we are fully committed to working globally in helping to define what those standards could look like in the future.
We have always met our international commitments. On beneficial ownership we meet the standards of both the FATF and the OECD. The Isle of Man works internationally to combat financial crime, contributing to improvements in global standards for anti-money laundering and countering terrorist financing. Our law enforcement agencies and Financial Intelligence Unit regularly work with and assist other countries with their investigations, providing information which includes beneficial ownership.
However, it must be for the Isle of Man to decide if and when we will introduce public beneficial ownership registers.
We are fully supportive of measures aimed at combatting money laundering and other financial crimes. We have made our commitment clear, with our Exchange of Notes with the United Kingdom in 2016 that we will exchange adequate, accurate and current information on beneficial ownership to combat tax evasion. And I have said before: we are committed to working with the UK Government, the OECD and the FATF in order to develop an effective global standard.
I would like to thank the Ministers and officers that have worked across the weekend preparing briefing material and statements and coordinating our work effectively with those of Jersey and Guernsey. While we welcome the swift action of the UK Government yesterday, we will continue to strongly resist any attempt to undermine our longstanding democracy.