More Information to Be Disclosed: BENEFICIAL OWNERSHIP OF CORPORATIONS

There is a global trend emerging
focused on requiring corporations to
disclose the identity of their beneficial
owners. Beneficial owners are generally
individuals that either directly or
indirectly exercise ultimate ownership
or control over a corporation. The 2021 Federal Budget in Canada provided $2.1 million to
support the implementation of a publicly accessible
corporate beneficial ownership registry by 2025. Some
provinces have also commenced work on such disclosures.
As an example of what may come, consider the
developments in the U.S. and U.K.

United States
On January 1, 2021, the National Defense Authorization Act
for Fiscal 2021 was enacted. This Bill contained the
Corporate Transparency Act, which introduced significant
disclosure of beneficial ownership requirements. The
legislation will apply to private corporations and limited
liability companies (LLCs) registered to do business in the
U.S. (including both domestic and foreign corporations) but
will exclude a few types of entities, such as publicly listed
corporations. Identifying information of beneficial owners
that have substantial control will be required to be
disclosed for new entities and those entities that have
changes. Information collected will be available to law
enforcement agencies, but not to the general public.

United Kingdom
In 2016, the U.K. launched a publicly accessible register of
beneficial owners of companies (the register of Persons
with Significant Control). The information displayed can
basically be used by organizations and individuals without
restriction. The minimum share percentage ownership at
which disclosure is required is 25%.

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