Editing Shell corporation (section)

== Regulation ==
Since shell companies are very often abused for various illegal purposes, regulation of shell companies is becoming more important to prevent such illegal activities.

=== United Kingdom ===
Currently British overseas territories and crown dependencies are only required to tell the true name of owners of shell companies upon request from official law enforcement agencies. However, since 2020 they are forced to publish these names in a public register in order to prevent anonymous use of shell companies.<ref>{{Cite web|url=http://www.dw.com/en/uk-moves-to-trace-tax-avoiding-overseas-shell-firm-owners/a-43609438|title=UK moves to trace tax-avoiding overseas shell firm owners {{!}} DW {{!}} 01.05.2018|website=DW.COM|publisher=Deutsche Welle|language=en|access-date=2018-06-10}}</ref>

=== United States ===
The new customer due diligence (CDD) rule from 2016 requires that banks know the identities of beneficial owners of legal entity customers, enabling them to disclose this information to law enforcement agencies, thus aiding in the identification true business owners and their tax liabilities. Thereby, the rule aims to prevent the anonymous misuse of shell companies. The rule is administered by the [[Financial Crimes Enforcement Network]] (FinCEN).<ref>{{Cite news|url=https://www.federalregister.gov/documents/2016/05/11/2016-10567/customer-due-diligence-requirements-for-financial-institutions|title=Customer Due Diligence Requirements for Financial Institutions|date=2016-05-11|work=Federal Register|access-date=2018-06-10|publisher=Financial Crimes Enforcement Network (FinCEN)}}</ref> In January 2021, anonymous shell companies were effectively banned via a provision in the [[William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021]].<ref>{{Cite web|last=Kirby|first=Jen|date=2020-12-21|title=The US has made its biggest anti-money-laundering changes in years|url=https://www.vox.com/22188223/congress-anti-money-laundering-anonymous-shell-companies-ban-defense-bill|access-date=2021-01-06|website=Vox|language=en}}</ref> In 2025 however the US Treasury department announced it would not enforce this law, and thus shell companies would not be required to follow the law requiring they disclose their owners and beneficiaries.<ref>{{cite news|url=https://www.icij.org/inside-icij/2025/03/treasury-department-wont-enforce-beneficial-ownership-rule-under-the-corporate-transparency-act/|title=Treasury Department won't enforce beneficial ownership rule under the Corporate Transparency Act|date=2025-03-05|publisher=International Consortium of Investigative Journalists}}</ref> On March 21, 2025, FinCEN announced an interim final rule removing the reporting requirement for domestic businesses.<ref>{{Cite web |date=2025-03-21 |title=FinCEN.gov |url=https://www.fincen.gov/news/news-releases/fincen-removes-beneficial-ownership-reporting-requirements-us-companies-and-us |access-date=2025-05-16 |website=FinCEN.gov |language=en}}</ref>

=== India === 
A "Task Force On Shell Corporations" was constituted in 2017 under the chairmanship of the Revenue Secretary to the Government Of India and Corporate Affairs Secretary to Govt. Of India, for effectively tackling malpractice by shell companies in a comprehensive manner.<ref>{{cite web|url=http://pib.nic.in/newsite/PrintRelease.aspx?relid=169204|title='Task Force on Shell Companies' for effectively tackling the malpractices|access-date=2018-07-08}}</ref>

=== European Union ===
On 22 December 2021, the European Commission adopted a proposal for an EU Directive to tackle the misuse of shell companies for tax purposes.<ref>{{Cite web|last=European Commission|title=Questions and Answers on the Commission's proposal to end the misuse of shell entities|url=https://ec.europa.eu/commission/presscorner/detail/en/qanda_21_6968}}</ref> Also known as the "Unshell" directive, the proposal requires the unanimous agreement of all 27 EU Member States' finance ministers before entering into force.