New Brunswick

Province will force companies to reveal who controls them

New Brunswick has committed to adopting beneficial ownership, the minister responsible for Service New Brunswick announced Thursday

Coming legislative changes aimed at combating tax evasion, money laundering

The provincial government has committed to adopting beneficial ownership, falling in line with the federal government and several other provinces. (Karissa Donkin/CBC)

New Brunswick has committed to adopting beneficial ownership, the minister responsible for Service New Brunswick announced Thursday.

Mary Wilson revealed the decision after Green Party MLA Kevin Arseneau asked about the issue during Question Period.

"Corporations will have to maintain a register of individuals who have significant control in their companies and make that information available to law enforcement and taxing authorities," Wilson said in the Legislature.

"This will increase ownership transparency and assist in exposing activities such as money laundering and tax evasion."

The pledge comes after a CBC News/Radio-Canada investigation in September found the province has lax corporate rules that make it difficult to tell who really owns and controls corporate entities.

The legislative change would bring the province in line with the federal government and five other provinces that have passed similar amendments.

But it doesn't appear to go as far as jurisdictions such as the United Kingdom, where the public can search the beneficial ownership registry for free.

Mary Wilson, the minister responsible for Service New Brunswick, says the coming changes will "assist in exposing activities such as money laundering and tax evasion." (CBC)

Arseneau believes the public should be able to access New Brunswick's registry, not just law enforcement and tax authorities.

"It's a question of transparency," Arseneau said in an interview with CBC News.

"It's a question of understanding who is reaping profit from certain activities. It's understanding the corporate web that's being used."

Premier ordered review of corporate rules

Three years ago, the previous government signed on to the "Agreement to Strengthen Beneficial Ownership" aimed at combating "money laundering, tax evasion and terrorist financing."

Then, in September, Premier Blaine Higgs said he'd asked staff to review the province's corporate rules.

But Thursday marked the first clear indication that the government plans to go ahead with beneficial ownership.

Just a few weeks ago, Finance Minister Ernie Steeves appeared to question whether such changes were necessary.

"We have committed to look at the beneficial ownership," Steeves said during Question Period on Nov. 20.

"So far, what we have found is that it is not hurting anybody in New Brunswick, but it is certainly something — an irregularity — that we have to look at."

'It actually is hurting New Brunswickers'

"I'd argue it actually is hurting New Brunswickers," Arseneau said.

"Even if it wasn't, this still isn't an excuse. [Those are] the kind of arguments that tax havens will have. 'Well, we're profiting from it, so we don't want to be too strict on that.'"

New Brunswick Green Party MLA Kevin Arseneau believes the public should be able to access the province's beneficial ownership registry. (Karissa Donkin/CBC )

When Arseneau raised the issue in Question Period again Thursday, he questioned whether the province's lax rules and hot housing market could make the province "the next target for outside investors looking to invest in the real estate market, driving up the prices of housing and apartments in New Brunswick."

He cited British Columbia, where billions of dollars are estimated to have been laundered through the province in 2018, including $5 billion through the province's hot real estate market, as an example.

The New Brunswick government hasn't offered a timeline for when it will introduce the legislative amendments.

"They are not on the schedule for the current sitting as they are still in the development/approval process," government spokesperson Valerie Kilfoil wrote in an email.

Wilson wasn't made available for an interview.

ABOUT THE AUTHOR

Karissa Donkin is a journalist in CBC's Atlantic investigative unit. Do you have a story you want us to investigate? Send your tips to NBInvestigates@CBC.ca.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversationCreate account

Already have an account?

now