The Philippines commits to beneficial ownership transparency
The Philippines recently launched the Opening Extractives Programme, a global programme aiming to transform the availability and use of beneficial ownership data for effective governance in the extractive sector. The programme will support the implementation of beneficial ownership reforms and enable the use of beneficial ownership data by government, civil society and companies.
An interview after the launch event with Eastword Manlises, National Coordinator of the EITI in the Philippines (PH-EITI) and Eah Antonio, Governance and Integrity Specialist, also from PH-EITI, gave their insights on why beneficial ownership transparency is important in their country.
What are the benefits of having beneficial ownership data accessible to the public in the Philippines?
A country’s natural resources belong to its people, and resource extraction should ultimately benefit the public. Making companies’ beneficial ownership data accessible to the public is a way of empowering citizens to be part of resource governance. With this information, anyone can scrutinise transactions in the extractives sector, to see who benefits from extractive activities, and who is accountable for the impacts of such operations. Civil society and members of the affected communities in particular will be in a better position to safeguard the sector and their communities. In addition, making beneficial ownership data publicly accessible enables users to do their own fact-checking or data verification, and pursue research and advocacy activities based on robust data.
The Philippines recently launched the Opening Extractives programme. In what ways can the programme help support the efforts of the Department of Finance in beneficial ownership transparency?
Some five years ago, PH-EITI and its Multi-stakeholder group, lodged in the Department of Finance, drew up a roadmap for beneficial ownership transparency in the Philippines. Opening Extractives is key to following through on these plans and strengthening initial efforts towards greater transparency. Beneficial ownership disclosure is also one of the commitments of the Philippines in meeting international standards which include that of the EITI, Open Government Partnership and the Financial Action Task Force. PH-EITI has already started a beneficial ownership register for the extractive sector, but companies’ public disclosure of data remains voluntary. Opening Extractives is expected to help the Philippines enhance this initiative and even advocate a cross-sector beneficial ownership register in the long term, meaning that companies outside the sector would also make beneficial ownership disclosures. Further, Opening Extractives will support initiatives to improve the legal and regulatory framework for beneficial ownership disclosure. Much is to be gained from the EITI’s and Open Ownership’s technical expertise and from peer learning and capacity building for stakeholders in the Philippines.
What important points on beneficial ownership transparency were raised at the launch?
The launch served as a platform to introduce the programme to the wider public, including the engagement plan for the Philippines. Since 2016, PH-EITI has made efforts to promote beneficial ownership transparency in the extractive sector, leading to voluntary beneficial ownership information on companies and its publication through the annual reports and the PH-EITI public register. While there has been continuous progress, there exist some roadblocks and challenges, including the need for a legislation and an enabling environment for transparency.
There are some challenges on beneficial ownership disclosure when it comes to data privacy, and questions on the necessity and benefits of giving the public access to companies’ ownership information. So, the engagement plan includes efforts to seek legislation, or an executive policy at the very least, that would make the publication of beneficial ownership information mandatory. The Philippine Securities and Exchange Commission emphasised that transparency would keep the financial system and the economy healthy and progressive. With the engagement plan, more stakeholders are expected to be involved in ensuring transparency in the sector.
Why is beneficial ownership such an important issue for the Philippines and how can beneficial ownership registers help increase accountability?
The Philippines is rich in natural resources and there are several ancestral domains and indigenous communities affected by mining operations. Stakeholders have the right to know who obtained the rights to extract these resources.
Beneficial ownership transparency will be particularly useful in curbing risks of corruption and money laundering. Furthermore, disclosing beneficial ownership information will help improve government’s tax collection, helping to level the playing field for businesses. Beneficial ownership disclosure will also help deter conflicts of interests, especially when there are politically exposed persons or government officials who hold interests in mining operations or have influence over policy implementation and the granting of extraction permits and licenses.
Related articles and publications
European Parliament issues proposals to improve beneficial ownership data access and quality
The European Parliament has announced a range of draft proposals in its Sixth Anti-Money Laundering Directive. If adopted, these would put in place important measures to ensure that journalists, civil society organisations, and academic researchers are given meaningful access to beneficial ownership data from EU Member States
Published: 29 March 2023
Extractives, Opening Extractives