LONDON: The United Kingdom government has yet to impose fines on foreign corporations that violated a historic transparency rule with fines of up to £1 billion.
Since January, foreign companies that hold property in the UK are subject to fines of up to £2,500 per day if they fail to disclose their ownership, the BBC said.
There haven’t yet been any fines levied despite the fact that thousands of businesses, including ones connected to oligarchs like Roman Abramovich, have yet to comply with UK laws.
The government said that it was “building cases” against unregistered businesses.
In response to Russia’s invasion of Ukraine, the registry was first launched in February 2022 as a component of the Economic Crime Act. Ministers said that it would expose the true owners of UK property and prevent foreign criminals from using UK property as a means for laundering money.
Approximately 5,000 businesses owning property in England and Wales have not yet filed their information, more than three months after the deadline of January 31. The UK government asserts that the actual number is probably smaller because several hundred businesses have already transferred their property and some may no longer exist.
However, if the maximum daily financial penalty were applied on every company that has not provided its information, the entire amount in fines would build up to £10m each day, even if there were only 4,000 businesses that are not in compliance with the legislation.
This would total close to £1 billion over the more than 100 days that have passed since the deadline.
According to John Barnett from the Chartered Institute of Taxation, some international corporations might not be aware of the new regulation quite yet, while others might be finding it difficult to locate and confirm all of their beneficial owners.
Others, though, might not be planning to comply.
The Department for Business and Trade said it was constructing cases against businesses that had missed the registration deadline and was working with law enforcement to “prioritise action against the most egregious offenders” despite the fact that no monetary fines had been imposed.
According to the spokesperson, the UK is the first nation in the world to adopt “this tough new approach to tackle money laundering through property.” She continued, “Fines are just one tool in our arsenal to crack down on non-compliance, and non-compliant companies are already unable to buy or sell unregistered land, cutting off the flow of money.”
However, as the government has admitted, it might be difficult to identify which properties are held by billionaires with ties to Vladimir Putin.
