The National Association of Estate Agents has thrown its weight behind a government move to create a register of overseas companies and other legal entities that own property in the UK, in a bid to cut down on money laundering activities.
The government says the register - now subject to formal consultation - would be the first of its kind in the world to show the ‘beneficial owners’ of property controlled by overseas companies and other legal entities. The register would also list the beneficial owners of overseas-registered firms involved in central government procurement exercises.
“This new register will set a gold standard for transparency and enhance the reputation of the UK property market as an attractive place to do business. We will be working closely with our members to help them understand the requirements that will help shape the world’s first register of its kind” according to Mark Hayward, chief executive of NAEA Propertymark.
A government statement announcing the proposals says legitimate foreign investment in the UK is of course welcome, but adds that “overseas investors in the UK property market have also included criminals laundering the proceeds of crime.”
Since 2004, law enforcement investigations into international corruption have identified more than £180m of property in the UK as the suspected proceeds of corruption, with 75 per cent of those investigated using overseas companies to hide their real owners.
As Estate Agent Today reported earlier this week, anti-corruption organisations believe the scale of ownership of UK property - particularly high-end London homes - to be much larger than the government and others suggest.
Now the government is calling for evidence and is asking overseas investors, property and transparency experts for their opinions on how this register could be delivered. The government already requires owners and controllers of UK companies to be registered with Companies House.
A research project, due to be launched shortly for the Department for Business, Energy and Industrial Strategy, will assess the likely impact of the overseas property register on inward investment and wider corporate transparency.
“The extension of transparency requirements, which UK owners are already subject to, levels the playing field and means we would know who owns and controls UK property wherever they are from” says business minister Margot James.
“Criminals and their money launderers will always seek to hide the true ownership of assets, including property, to frustrate investigations and hold onto the profits of their crimes” says Donald Toon, director for economic crime at the National Crime Agency.
You can see the government’s call for evidence here.