Deputy Kirsten Morel, who chairs the Economic Affairs Scrutiny Panel, recently addressed comments made in Bermuda newspaper The Royal Gazette in an article discussing the territory’s move to introduce legislation for full transparency on company ownership by January 2023.
In 2018, the UK parliament passed laws requiring the Overseas Territories to publish fully transparent registers of ‘beneficial ownership’ of companies in their jurisdiction, meaning that the ultimate ownership of assets would be revealed. Legislation relating to the Crown Dependencies was withdrawn at the last moment.
In the article, Bermuda’s former finance minister Bob Richards reportedly felt that Britain had been ‘racially biased against its OTs [British Overseas Territories], in that the Crown Dependencies of Jersey, Guernsey and the Isle of Man were treated more favourably with regard to ownership transparency’.
Referring to the article in a tweet, Deputy Morel said: ‘This is a strongly held view in Bermuda and it’s one that we in the CDs [Crown Dependencies] should consider and not dismiss out of hand.’
Speaking to the JEP, he added: ‘It was raised with me by a member of the Bermuda House of Assembly when I was speaking at a Commonwealth Parliamentary Association event last year. When challenged at the event, it made me stop and think about the differing relationships between the Overseas Territories, the Crown Dependencies and the UK.
‘On the spot, I was unable to either agree or disagree that there was a current of racism underpinning those relationships. I also realised and admitted that it was something I, and to be honest, I imagine most people in the Crown Dependencies, hadn’t really considered and so it shouldn’t be dismissed and should become a basis for discussion.’
Like the Crown Dependencies, the British Overseas Territories, which include jurisdictions such as Bermuda, Cayman Islands and Barbados, are allegiant to the British Crown but have a different constitutional relationship.
‘From my perspective and probably the perspective of most people in Jersey, Guernsey and the Isle of Man, and in Westminster, we wouldn’t have thought there is any racism in the relationships,’ said Deputy Morel. ‘But we cannot possibly be sure of that without speaking with those who allege that there is, and so I think it is really important that we listen to the concerns of parliamentarians in Bermuda and the other Overseas Territories.’
Although there has not been any legislation passed to enforce ownership transparency in the Crown Dependencies, all three islands have also now committed to producing transparent registers by 2023 in line with EU member states.
Mr Richards said Bermuda could have ‘resisted successfully’ the British legislation that would see an Order in Council being issued at the end of this year, requiring Overseas Territories to keep public ownership registers.
When asked if Crown Dependencies had been given special treatment, Deputy Morel said: ‘Honestly, I’ve no idea whether the Crown Dependencies get special treatment because I’ve never been involved in negotiations regarding ownership transparency. However, it is a fact that Jersey has a different constitutional relationship to the UK compared with that of Bermuda and Jersey also adopted a very clear stance early on, which meant that our position could be easily understood by the UK and the EU.’
Last year UK politician Andrew Mitchell MP said that he and fellow politician Dame Margaret Hodge had ‘irrefutable’ legal advice that the UK could pass laws on the Crown Dependencies – Jersey, Guernsey and the Isle of Man – should it need to.
Speaking on Jersey’s financial regulation, Deputy Morel said: ‘I believe the regulator does an excellent job in ensuring that Jersey’s finance industry remains at the top of the rankings in terms of regulatory integrity and this is incredibly important.
‘Where I think we do have problems is in terms of the way that international regulations are effectively applied to all Island businesses equally, regardless of whether the client base is international or not. As a result, we’re seeing problems such as the lack of provision of independent financial advice to Islanders who are not on high incomes.’
We need to ensure that islanders and island businesses are not disadvantaged by the drive to be at the leading edge of international regulation.’