Boris Johnson May Cut Deadline for Foreigners to Declare U.K. Property
(Bloomberg) -- Prime Minister Boris Johnson's government is open to cutting a grace period for foreign owners of U.K. property to register their interests, according to two people familiar with talks between the ruling Conservatives and opposition parties.
Under legislation to be debated on Monday in the House of Commons, the government plans to set up a register that identifies the ultimate foreign owners of U.K. real estate, preventing them from hiding behind shell companies.
Under the draft bill, individuals would have 18 months to join the register and the opposition Labour Party says that is too long. It's proposing shortening it to 28 days and is in talks with Johnson's Conservatives administration about a potential compromise.
One of the people with knowledge of the discussions said the government is open to a six-month period as a compromise, while a second person said only that ministers are prepared to shorten the proposed period. They requested anonymity speaking about private discussions.
Read More: U.K. Sanctions Usmanov, Shuvalov With Full Asset Freeze
Russia's invasion of Ukraine has forced the government to accelerate plans to introduce the register, which had been on the back-burner for successive Tory administrations since 2016. The aim is to bring transparency to property ownership and end concerns among Tory and Labour lawmakers alike that London has become a “laundromat” for wealthy foreigners -- and Russians in particular -- to clean up illicit wealth.
“Why are we giving Putin's cronies 18 months to quietly launder their money out of the U.K. property market and into another safe haven?” Labour leader Keir Starmer asked Johnson in the Commons on Wednesday, adding that he wanted to “work together” with the premier to speed the process up.
Ministers are concerned about striking the right balance between targeting foreign criminals and trapping legitimate, law-abiding owners, according to one of the people.
Under the legislation, failure to meet the registration deadline is an offense opening up owners to potential imprisonment or a fine.
©2022 Bloomberg L.P.
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