Beneficial ownership transparency in Armenia: scoping study
Armenia’s extractives pilot has laid a solid foundation for the creation of a centralised, public BO register across all industry sectors, in line with the commitments the country has made within its Open Government Partnership National Action Plan (2018-2020).
Implementation has been facilitated by a high level of political commitment to tackling corruption and improving transparency, and by the keen interest of numerous civil society actors in seeing these reforms advance. In this context, Armenia has been able to advance comparatively quickly by international standards to establish new systems for the collection and publication of BO data for the extractive industries. Though such data is currently only available via PDF scans of paper forms, rather than in the machine readable format that would facilitate analysis and verification, the disclosures from the sector are already being used by civil society organisations and investigative journalists.
The next stage of the reform process – expanding the disclosure requirements from the extractives sector to cover the whole economy – will be especially important to the success of Armenia’s future anti-corruption endeavours. Transitioning from a narrowly focused pilot to an economy-wide BO disclosure regime will present additional challenges, given the need for new software development and the far greater numbers of firms who will soon become subject to BO disclosure requirements. Resourcing difficulties will also likely be compounded by the evolving COVID-19 pandemic and its associated effects on public health and political and economic systems.
Despite this, the existence of a broadly positive political context for reform, as well as the presence of an engaged group of local data users, bodes well for the potential future impact of the country’s BO data disclosures. Armenia’s implementing agencies are already making improvements to their systems and disclosure regime based on the feedback and learnings from the extractives pilot. One notable example is the form for obtaining the BO data from firms, where the Ministry of Justice and EITI Armenia have collated their own learnings from the pilot, together with feedback from OO, the disclosing firms, and the software company; they are making numerous changes to the form to improve usability and flow with the aim of improving the quality of data disclosed. This improved form will then be used to collect BO information during the second round of disclosures for firms in all other industry sectors.
Whilst this report has outlined a range of suggestions regarding how Armenia could improve on future iterations of its disclosure regime, it is the creation of an electronic BO register and the shift towards publication of structured data in line with the BODS that should be the areas of highest priority. Effective implementation of these two changes would underpin the anti-corruption impact of Armenia’s disclosures and provide the framework upon which future incremental improvements could be made.
Beyond its expected domestic impacts, Armenia’s experience of creating a public and centralised BO register will also yield valuable learnings for other contexts. Currently, there is no clear roadmap for implementers internationally to pursue when moving from a single-sector BO disclosure regime to an economy-wide approach. Armenia’s experience will provide excellent insights to larger countries, like Mexico, that have committed to a similarly staggered approach to rolling out BO disclosure requirements across their economies.