Beneficial ownership pilot evaluation report
Transparency about company and government payments is important for accountability, but tells citizens little about who owns extractive companies and ultimately benefits from the companies’ activities. In many cases, the identity of the real owners – the ‘beneficial owners’ – of the companies that have acquired rights to extract oil, gas and minerals is unknown, often hidden behind a chain of corporate entities. This opacity can contribute to corruption, money laundering and tax evasion in the extractive sector.
In adopting the EITI Standard in May 2013, the EITI Board agreed to recommend disclosure of beneficial ownership information and that the EITI will in the future require disclosure of the beneficial owners of oil, gas and mining companies operating in implementing countries. Subject to successful piloting, the Board agreed to develop detailed provisions with a view to make this a requirement from 1 January 2016. While the Board noted the importance of transparency of beneficial ownership to the effective governance of the extractive industries and as a check against corruption, the Board also recognised that there was limited experience in addressing these issues in the context of the EITI, and that additional piloting and experimentation was needed.