On Monday 7.11.2022, Treasury issued a consultation paper on the Government’s far reaching proposal to implement a public registry of beneficial ownership, which will show who ultimately owns, controls, or receives profits from a company or legal vehicle. This could be one of the biggest regulatory developments in years and be massively intrusive. This will apply to entities regulated under the Corporations Act, but will not be limited to listed or multinational entities. It will include private entities and they expect will apply to 3 million entities. There will be a 20% threshold on direct and indirect ownership and separate control tests – right through to the ultimate individuals. Entities have to keep their own register, with details either on their website or available on request. In later phases the details will have to be consolidated on a public register. Entities will have to take steps to be ‘reasonably assured’ of the accuracy of the register. Penalties will apply to regulated entities, their officers and beneficial owners for non-compliance with this regime.

This was part of Labor’s election platform. Implementation of this strategy will reportedly bring Australia in line with other G20 nations such as Canada, the UK, and the US, while reference is made in the paper to regimes operating in Singapore and France. The Government is seeking comments on the design features for the first phase of a publicly available beneficial ownership register. It also seeks views on potential amendments to the substantial holding and tracing notice regimes in the Corporations Act.

Comments are due by 16 Dec 2022.

[Treasury website: Consultation Page; Consultation Paper; LTN 212, 7/11/22]



Extracts from the Consultation Paper are set out below.


The Government is introducing a public register of beneficial ownership information to record who ultimately owns, controls, and receives benefits from a company or legal vehicle operating in Australia. Making the beneficial ownership information available on a public register is intended to increase transparency and discourage the use of complex structures that avoid legal requirements and obscure tax liabilities. The reform is a key element of the Government’s commitment to ensuring multinational enterprises pay a fairer share of tax.

1. Existing framework and the case for reform

Current beneficial ownership disclosure provisions

Australian corporations law currently requires entities listed on a prescribed Australian financial market to collect and disclose beneficial ownership information. The disclosure of beneficial ownership information is primarily effected through the substantial holding notice and tracing notice regimes (see Boxes 1.1 and 1.2 below). Together, these regimes capture a broad range of beneficial ownership arrangements in listed entities.

Problem and need for Government action

While the Corporations Act facilitates disclosure of some listed entity beneficial ownership information, Australia does not have a framework for the systematic collection, verification, and release of beneficial ownership information, including for unlisted corporations, unlisted CCIVs, and unlisted registered MISs. This gives rise to potential gaps in regulatory coverage and can create opportunities for exploitation. … A lack of transparency gives rise to opportunities to:

  • conceal ownership of assets through overseas companies or trusts to evade tax liabilities, debts, or sanctions laws
  • launder money and disguise the true ownership of assets acquired with illegally obtained wealth
  • conceal related party transactions and other dealings which are not at arm’s length.

2. Definition of beneficial ownership

Beneficial owners are natural persons who ultimately own or control an entity, legal vehicle, or asset. Beneficial owners are not always the legal owners of the relevant entity, vehicle, or asset.

Proposed Approach

In line with this objective, the Government proposes to adopt the United Kingdom’s approach to thresholds for registration on a beneficial ownership register. Under this model, a regulated entity specified in section 3 would include on its beneficial register entities or individuals who either:

  • hold, directly or indirectly, 20 per cent of the shares or units in the regulated entity
  • hold, directly or indirectly, 20 per cent of the voting rights in the regulated entity
  • hold the right, directly or indirectly, to:
    • appoint or remove a majority of the board of directors of the regulated entity (where the regulated entity is an unlisted proprietary or unlisted public company)
    • appoint or remove the regulated entity’s responsible entity (where the regulated entity is a MIS)
    • appoint or remove the regulated entity’s corporate director (where the regulated entity is a CCIV)
  • have the right to exercise, or actually exercise, significant influence or control over the regulated entity.

3. Entities subject to beneficial ownership disclosure requirements

The proposals in this paper build on the existing disclosure regimes for listed entities by extending beneficial ownership disclosure requirements to a broader range of entities regulated under the Corporations Act. As a result, over three million additional, unlisted entities would be subject to transparency measures with respect to the disclosure of their beneficial ownership information.

Proposed approach

It is proposed that the first phase of implementation focus on the following entities as they are regulated by the Commonwealth and are currently required to maintain registers of legal ownership. They therefore have an existing framework that can be applied to the collection of beneficial ownership information.

  • Proprietary companies
  • Unlisted public companies
  • Unlisted registered MISs
  • Unlisted CCIVs

(together the ‘regulated entities’).

Regulated entities would be expected to take reasonable steps to identify and verify their beneficial owners, and to develop and maintain an accurate, up-to-date, publicly accessible beneficial ownership register

Proposed approach

The Government proposes to require regulated entities to maintain registers of their beneficial ownership as an important step towards a future central registry, subject to technical feasibility assessments and future consultation.

  • In the first phase of the proposed approach, each regulated entity would identify on its register the information set out in section 5 with respect to entities and individuals in its beneficial ownership chain.
  • In future phases, the Government will seek to collate information from each regulated entity’s register onto a public, central register as shown in Figure 4.1 below (subject to technical feasibility specifications and informed by future consultation). At this time, the Government will also consult on any ongoing requirements for regulated entities to individually record and retain beneficial ownership information.

5. Content and availability of beneficial ownership register

The Government intends regulated entities’ beneficial ownership registers to be accessible by the public. Public access could be facilitated by either allowing interested parties to request a copy of the register from the regulated entity or requiring regulated entities to publish their registers online. Each of these options would be subject to exceptions for the protection of individuals’ privacy and safety. This would increase market transparency and regulatory oversight of individuals who own or have significant influence or control over regulated entities, while also maintaining important privacy protections and safety.

Protection of certain information from public disclosure

To protect the safety of listed individuals, the Government proposes to:

  • exempt from public release the disclosure of beneficial owners’ residential addresses except to government authorities
  • allow any regulated entity or beneficial owner to seek regulatory exemption from public disclosure of other information about the beneficial owner (except to government agencies) on the basis such disclosure would put at risk the personal safety of the beneficial owner or another person.

6. Accuracy and currency of beneficial ownership registers

The register must be accurate and up to date to ensure it is a credible foundation for corporate transparency and a strong and trusted business environment. Specifically, this means information on the register must be:

  • accurate at the time the information is first recorded
  • updated promptly when changes occur.
Proposed approach

The Government proposes to require regulated entities to be reasonably assured of the identities of their beneficial owners.

Regulated entities could verify the identity of their beneficial owners through appropriate internal processes. The Government also intends to permit regulated entities to use identity verification service providers to verify the identities of beneficial owners. In a future phase, it is possible a centralised register could utilise existing government services to verify the identities of beneficial owners (subject to technical feasibility specifications and informed by future consultation).

7. Enforcement and penalties

The Government proposes to introduce enforcement provisions and penalties to enhance compliance with the beneficial ownership disclosure regime proposed in this paper.

The Corporations Act currently includes penalties for:

  • failure by a company or registered MIS to maintain a register of members (section 168) (30 penalty units)
  • failure by a person to provide a substantial holding notice (section 671B) (two years’ imprisonment for a fault-based offence and 60 penalty units for a strict liability offence)
  • failure by a person to provide beneficial ownership information in response to a tracing notice (section 672B) (60 penalty units)
  • failure by a listed company or a responsible entity for a listed registered MIS to maintain a register of beneficial ownership information received in response to a tracing notice (section 672DA) (20 to 30 penalty units depending on the specific obligation breached)
Proposed approach

Under the proposed approach, penalties would apply to regulated entities, their officers, and beneficial owners for non-compliance the new beneficial ownership regime, including for the restrictions notice regime outlined below and the privacy and protection regime in section 5. These would align with other serious civil and criminal penalties in the Corporations Act for failures to disclose legal ownership information.

8. Regulatory costs and benefits

The Government also recognises many of the three million regulated entities would incur regulatory and compliance costs under the proposals in this paper, including to:

  • undertake an initial collection of beneficial ownership information (to the extent regulated entities do not have this information already) and provide it to regulators (if necessary)
  • verify and maintain currency of information on the register
  • identify and add to the register details of new beneficial owners.



[Tax Month – November 2022 – Previous Month, 19.11.22]