Treasury officials say they will include a more workable definition of “beneficial ownership” in the draft money laundering regulations, following a sustained lobbying campaign by the Law Society.
Economic Secretary Ed Balls MP confirmed this week that the Treasury will consult on an extended definition of “beneficial ownership” to improve clarity. The society will then have two weeks to review the re-drafted definition.
Fiona Woolf, society president, says: “The definition of a ‘beneficial owner’ was so unclear that it made it impossible for a solicitor to know who should be the subject of client due diligence. It would have placed a huge burden on solicitors and deterred investment into the UK.”
The about-turn comes after the society provided the EU with legal advice from Matrix Chambers that the definition so lacked clarity that it was unlawful and could not be fixed by professional guidance. The society sought assistance from the European Commission regarding the flexibility available to them in implementing the Third Money Laundering Directive and, last week, Commissioner McCreevey explained that adopting the wording of Directives to suit national legal frameworks is at the