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Premier vows to challenge UK if ownership registry is mandated

Friday, May 25, 2018

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GEORGE TOWN, Cayman Islands (CMC) — Premier Alden McLaughlin says his administration will head to court if the United Kingdom decides to mandate a public beneficial ownership registry for companies in the territory.

During a press conference on Monday, McLaughlin said that the stance being taken by the UK is “unlawful and we do not accept it”.

According to McLaughlin, the Government would wait to see if the UK issues the order in council to require the establishment of a public company ownership registry and then wait further to see if it seeks to implement that in the Cayman Islands.

“Cayman's best course of action is to challenge any decision of the UK Government by order in council to amend local legislation … which will render the issue to our courts here,” he said. “That [challenge] will never happen if the UK doesn't make the order in council.”

He also noted that his administration would not seek any challenge within the UK courts to the May 1 vote in the House of Commons that amended Britain's Sanctions and Anti-Money Laundering Bill. The amendment inserted a requirement in the bill that all UK overseas territories implement an open public register of company ownership by December 31, 2020. If that deadline is not met, the bill requires the UK Secretary of State to draft orders in council to force the territories to comply.

He revealed that legal advice received by Cayman's Government in the UK noted that taking action against the vote in the Commons “brings the difficulties inherent in the arguments surrounding parliamentary supremacy”.

Parliament is the supreme legal entity in the UK and even if the courts do find its decisions to be unlawful, it is ultimately up to the lawmakers themselves to go back and change them.

The premier said the legal battles surrounding that process were likely to take years and, in the meantime, regulatory standards could change.

Concerning constitutional change, McLaughlin said he addressed this during meetings last week with UK Prime Minister Theresa May in an effort prevent a reoccurrence of what happened with the May 1 House of Commons vote on the amendment to the Sanctions and Anti-Money Laundering Bill.

The premier said any constitutional changes should provide that, as long as Cayman is in keeping with its international obligations and standards, its power of self-governance is “absolute”.

He, however, said that he did not perceive any of the UK's recent actions, or Cayman's challenging of those actions, as “steps toward independence”.

“But if the UK Parliament comes to believe they can legislate for the territories any time they disagree … it is a threat to our very existence,” he said.

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