EU Panama Papers Inquiry Chief Condemns U.K. No-Show

By Ben Stupples

The chairman of the EU’s Panama Papers inquiry has slammed the U.K. Treasury’s refusal to meet with investigators, raising concern over Britain’s commitment to the high-level investigation.

It was “most disappointing and regrettable that no one at the political level at HM Treasury was able or willing to meet” during the trip to London last week from the European Parliament’s Panama Papers inquiry committee, Werner Langen told Bloomberg BNA in a Feb. 14 e-mailed statement.

“I consider this a missed opportunity for HM Treasury to positively engage and discuss with” the Panama Papers committee members, “and this has been noted by our members,” he added.

The investigative PANA committee met with senior officials from Her Majesty’s Revenue and Customs and the tax authority’s own Panama Papers taskforce, Langen said Feb. 14.

It also met with the U.K.’s National Crime Agency and the Financial Conduct Authority. The U.K. Treasury, however, only sent the committee a “short e-mail” declining to meet, he added.

Set up in June 2016, the committee’s top aim is to uncover instances of member states obstructing European Union laws against money laundering, tax avoidance and tax evasion, according to Fabio De Masi, a German member of the European parliament and the inquiry committee’s vice chairman.

It visited London Feb. 9-10 as part of its inquiry into the Panama Papers leaks of offshore tax deals, and the Treasury’s refusal to meet will raise questions about the U.K.'s commitment to the investigation, with just over a month before it triggers the official process for leaving the EU.

Private Meetings

The meetings held during the trip were “informative and constructive,” and the U.K. officials could address technical issues, Werner said. The government officials, however, declined to comment on “political” questions that U.K. Treasury ministers—Chief Secretary David Gauke, Financial Secretary Jane Ellison and Economic Secretary Simon Kirby—would have been best placed to answer.

A confidential schedule of the committee’s two-day visit, seen by Bloomberg BNA, also indicated meetings with U.K. accounting and legal professionals, academics, non-governmental organizations and representatives from HSBC Holdings Plc, Britain’s largest bank by market capitalization.

The U.K. is “very relevant” on the topic of tax evasion due to the number of intermediaries linked to it through the Panama Papers, De Masi told Bloomberg BNA in a Feb. 8 interview.

The data leak of more than 11 million documents from Panamanian law firm Mossack Fonseca & Co. identified nearly 2,000 U.K.-based aides—such as accountants, lawyers and tax advisers—who facilitated aggressive tax planning.

Nearly half of the companies listed in the Panama Papers, meanwhile, were registered in the British Virgin Islands, one of the U.K.'s overseas territories.

EU Tax Blacklist

The comments from Werner, a member of the European People’s Party, follow critical claims from De Masi that the U.K. has hindered European Union plans against tax evasion.

“The U.K. is at the heart of the world’s largest web of tax havens and intricately connected with the world of offshore finance,” De Masi said in a Feb. 9 e-mailed statement. Through the U.K.’s overseas territories, “the who is who of global tax havens is thriving under the eyes of Her Majesty.”

The British government has been “sabotaging” work on the European Union’s planned blacklist for tax havens, despite its previous promises to crack down on global tax evasion, he added.

In November 2016, the U.K. achieved its first major victory against European Union nations since voting five months earlier to leave the bloc when it prevented its offshore territories—including Jersey, Bermuda and the Cayman Islands—from being automatically placed on the tax haven blacklist.

At the vote, the U.K. fought off an attempt by a France-led group of countries to denounce territories with a zero percent rate of corporation tax as potentially “non-cooperative.”

A Treasury spokesman didn’t respond Feb. 14 to two e-mailed requests for comment.

The PANA committee will report on its findings within the next year.

To contact the reporter on this story: Ben Stupples in London at bstupples@bna.com

To contact the editor responsible for this story: Penny Sukhraj at psukhraj@bna.com

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