Keeping data up to date is crucial for increasing trust in the accuracy of BO data and the effectiveness of disclosure regimes. Requiring the timely submission of changes to ownership data or details of natural or legal persons increases the confidence that the data is current. It also reduces the risk that the BO of a legal entity can be misrepresented during a lengthy submission window.
Requiring data to be regularly updated, and for those updates to include all changes that occurred since the last declaration, removes the potential for companies to disguise short term changes in BO. This closes a loophole that would otherwise enable actors to circumvent disclosure of all persons that have held BO of the company.
It is important to keep historical information about companies, as this can help uncover links that are not immediately evident from current information. For example, keeping and publishing historical records prevents an entity from obscuring its identity by changing its name, or a beneficial owner to hide by reincorporating. Historical and auditable records are critical for law enforcement to verify ownership claims against historical records. Historical changes can be referred to during investigation even where the accuracy of data is in question, and can provide evidence of “who knew what when” to assess, for instance, whether due diligence was undertaken effectively at a particular point in time.
This OO Principle is particularly relevant in the following aspects of implementation. These correspond to steps in our Implementation Guide.
A step-by-step guide to implementing beneficial ownership transparency.