[BRUSSELS] Owners of secretive companies in Europe will have a harder time keeping out of the public eye, EU negotiators agreed Wednesday, in another blow against opaque business practices after the LuxLeaks scandal.
The agreement reached by the European Commission, European parliament and member states approves the creation of a central register that will expose the ultimate ownership of all Europe-based companies or trusts.
Crucially, the registry will be accessible to anyone with a "legitimate interest" in identifying owners, such as investigative journalists and concerned citizens, though activists had hoped the access would be fully public.
"For years, criminals in Europe have used the anonymity of offshore companies and accounts to obscure their financial dealings," said Krisjanis Karins, rapporteur for the proposed law in European parliament.
"Creating registers of beneficial ownership will help to lift the veil of secrecy of offshore accounts and greatly aid the fight against money laundering and blatant tax evasion," he said.
The deal comes a month after the so-called "LuxLeaks" scandal that exposed often secret deals that saved some of the world's largest companies billions of dollars in taxes by setting up shop in Luxembourg while Jean-Claude Juncker - the new president of the European Commission - was the country's prime minister.
Mr Juncker last week urged swift approval of the measure, though under the condition it will be limited to those with a legitimate interest in accessing the information.
He made the call in a reply to a letter from investigative journalists who pressed him on the directive.
Most financial transparency activists acknowledged the deal was a step forward, but criticised the limited scope.
"It is disappointing that amidst financial secrecy scandals and promises for more transparency, the EU fell short of allowing the public to see who is behind anonymous shell companies and trusts," said Tamira Gunzburg, of the ONE advocacy group in Brussels.
According to the group, Germany, Spain and Britain resisted opening up the list to a broader audience, ultimately leaving it to "member states to determine who will have access to the information".
The EU measure however goes further than transparency guidelines agreed by G20 ministers this year.
In addition, Mr Juncker's commission has promised more proposals against tax fraud and evasion, including the automatic exchange of information on tax breaks handed to companies in individual member states.
Since June, the commission has also launched investigations into the tax affairs of Amazon and Fiat in Luxembourg, Apple in Ireland and Starbucks in The Netherlands to determine whether sweetheart tax deals could constitute illegal state aid.
To help its case, the commission on Wednesday said it would widen its anti-trust probe to all member states and called on national authorities to share information on tax rulings, the mechanism by which tax deals are handed to companies.