Oct 20, 2022
Finance Minister Chrystia Freeland reiterated the federal government’s desire to create a publicly searchable beneficial ownership registry for corporations in Canada during a press conference about sanctions on senior leaders in Iran earlier this month. Since a federal-provincial-territorial working group was established five years ago, most jurisdictions have passed corporate transparency legislation. But with a few not yet having announced such measures — and as 90% of Canadian corporations are registered with the provincial or territorial governments — the project will require more buy-in and cooperation.
Malcolm Aboud, counsel in Osler’s Litigation department, tells iPolitics that provinces that don’t join the effort would create “an opportunity for illicit actors.”
“It would potentially result in the increase or disproportionate incidents of money laundering in those provinces that don’t have beneficial ownership transparency in place to the degree that illicit actors may choose to incorporate in those jurisdictions.”
A centralized registry would include data on who actually owns and benefits from Canadian corporations, and could help to change the country’s international reputation as a destination for money laundering. Governments would need to work together not only on creating it, but on making sure that the information reported is accurate and verified.
“The beneficial ownership registry will only be as effective as the information in it,” Malcolm says.
“I understand right now that the government is relying on private actors to report the beneficial ownership information that they collect to the registry. There will need to be some type of oversight or enforcement to ensure the information being reported in the registry is accurate if it is to be truly effective.”
If you have a subscription, you can read Jessica Smith Cross’s full article, “Provincial progress on corporate transparency slower than we’d like: feds,” on the iPolitics website.