23 November 2022
ECJ rules that information held on beneficial ownership registers should not be publicly accessible
The European Court of Justice (ECJ) has this morning handed down a landmark judgment in which it has ruled that the EU's Fourth AML Directive (EU2015/849) whereby Member States must ensure that the information held on beneficial ownership registers is accessible to any member of the general public is INVALID as being a breach of Articles 7 and 8 of the Charter of Fundamental Rights of the European Union.
In particular, the ECJ found that the general public's access to information on beneficial ownership constitutes a serious interference with the fundamental rights to respect for private life and to the protection of personal data, as it allows a potentially unlimited number of persons to find out about the material and financial situation of a beneficial owner.
Furthermore, the potential consequences for individuals resulting from abuse of their personal data are exacerbated by the fact that, once the data has been made available to the general public, it can not only be freely consulted, but also retained and disseminated.
This decision will no doubt have implications for the commitments made by British Overseas Territories and Crown Dependencies to establish publicly available registers of beneficial ownership, in respect of which a number of those jurisdictions have, or currently are, undertaking consultations, and which most have committed to put in place by 2023.
The pendulum finally appears to be swinging back towards privacy and security, and public beneficial ownership registers may not in fact be a foregone conclusion. We will continue to watch this space and share developments.