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The directive will require member states to enable access to information on the beneficial ownership of companies. It will apply as from 1 January 2018.
The proposal is one of a number of measures set out by the Commission in July 2016, in the wake of the April 2016 Panama Papersrevelations.
Challenges
The EU has made significant progress in recent years to enhance tax transparency and strengthen cooperation between the member states' tax authorities. And recent amendments to anti-money-laundering legislation recognise the links between money laundering and tax evasion, as well as the challenges faced in prevention.
Media leaks such as the Panama Papers, revealing large-scale concealment of offshore funds, have highlighted areas where further measures still need to be taken. The transparency framework must be further reinforced at both EU and international levels.
Automatic exchange of information
In particular, tax authorities need greater access to information on the beneficial ownership of intermediary entities and other relevant customer due diligence information. The directive will enable them to access that information in monitoring the proper application of rules on the automatic exchange of tax information.
Where a financial account holder is an intermediary structure, financial institutions are required by directive 2014/107/EU to look through that entity and report its beneficial ownership. Applying that provision relies on information held by authorities responsible for the prevention of money laundering, pursuant to directive 2015/849/EU.
Access to that information will ensure that tax authorities are better equipped to fulfil their monitoring obligations. It will thus help prevent tax evasion and tax fraud.