The Swiss Federal Council to Track Corporate Ownership in Fight Against Money Laundering
The Federal Council declared on October 12, 2022, that the Federal Department of Finance (FDF) would put out a measure to make it simpler to determine genuine beneficial owners of corporate entities using a centralized register. The goal of the law is to strengthen the current anti-money laundering (AML) system and protect Switzerland's standing as a global financial and economic center.
In keeping with the Financial Action Task Force's (FATF) 2020 Guidance on Transparency and Beneficial Ownership, the Federal Council's decision is expected to model Switzerland's AML regime more closely after the global trend of nations employing register-based solutions to identify legal organizations. The FDF must draft the measure by the second quarter of 2023. The move intends to improve financial crime prevention and prosecution, integrity, and the Swiss standing as a financial center and commercial destination.
The proposal expands on recommendations made in the Federal Council's report to the Council of States Economic Affairs and Taxation Committee from December 2021. (EATC-S). It made several recommendations, one of which was to increase openness to make it easier to determine who the real owners of legal entities are. The intended registry will not be open to the general public but will be made available to the competent Swiss authorities tasked with detecting or combating financial crime. It also considers whether the anti-money-laundering toolset needs to be modified, particularly in the domain of the legal professions.