The Malta Independent 22 October 2020, Thursday

Why would you open secret company in Panama for legitimate reasons? - Greens Pana committee MEP

Kevin Schembri Orland from Brussels Tuesday, 31 January 2017, 09:00 Last update: about 5 years ago

Greens MEP and member on the Pana Committee Sven Giegold (above) has questioned why anyone would open a company in Panama for legitimate reasons.

He was asked by The Malta Independent, in Brussels, whether the Pana committee plans to consider possible enforcement against intermediaries or recommending further EU legislation for intermediaries with relation to financial services after they conduct their investigations in EU countries, to which he said yes.


“I believe that, according to our findings, intermediaries were critical in order to violate the letter or the spirit of anti-money laundering legislation or tax law of the member states. Because there are a few legitimate business cases, this fact is used to allow a vast area of illegal or illegitimate business cases, and member states hide behind these few legitimate cases”. He asked; “in the end, why would you open a secret company in Panama for legitimate reasons? Very hard to explain.”

“Therefore Europe must ensure that this parallel system ends, and the intermediaries cannot hide behind some obscure legitimate business cases to build a parallel system which is used for illegitimate business cases.”

Turning to the people invited to appear before the Pana committee mission to Malta, and to confirm whether PN MP Tonio Fenech was now off the list, he said; “at the moment he’s off the list, but of course the EU Parliamentary Committee has all the right, if there are additional findings, to invite others.

“One must clarify that the mandate of the Pana committee is not limited to cases within the Panama papers, but is about violations in anti-money laundering legislation and tax law. Therefore it is legitimate that members of the Nationalist Party were invited before the committee. We said, however, that we will limit it to the four strongest cases rather than have an excessively long list which would allow for evasive answers.”

Speaking about document access, he said that "the best thing the Maltese government could do at the moment is publish the Manfred Galdes report rather than simply allowing the audit. We want to see, and I believe the Maltese citizens have a right to see the Manfred Galdes report and to hear the views of Michael Cassar publicly, who stepped back from the post of Maltese Police Commissioner. We, as well as the Maltese people should be able to listen to their views."

Asked about Minister Konrad Mizzi chairing the energy council, when he is not the energy minister in Malta, the MEP described the situation as “funny.”

“It’s ironic that someone who has lost that mandate in Malta now chairs the council formations on this matter. Secondly, rather than having a European function as important as this, he should be fully cleared of the allegations which has not yet happened as the respective report is still kept in the drawer.”

Tax evasion entails a dramatic loss of a thousand billion euros - S&D MEP

This newsroom also interviewed S&D (the EU party which the PL falls under) MEP Hugues Bayet, who sits on the Pana committee in the European Parliament He was asked whether the Pana committee will look into the individual case of Maltese Minister Konrad Mizzi in relation to the Panama Papers.

“I don't think the mission and the purpose of our enquiry committee is to investigate individual cases. Our Committee is aimed at scrutinizing whether EU member states are compliant with the European legislation regarding the fight against money-laundering and tax evasion and what can be put forward to improve it.” He said that this is what he believes the main purpose of the February mission will be.

Asked whether he believes Malta to be a tax haven, the S&D MEP told this newsroom that one of the goals of the mission is to get a better understanding of the Maltese fiscal system. “We know that the taxation system seems very accommodating for corporates and the trading companies. Through the different meetings and discussions, the EP mission will have to examine whether there are loopholes in the application of EU legislation and will discuss with the Maltese authorities about future measures that will strengthen the fight against money laundering and tax evasion.”

“Tax evasion entails a dramatic loss of a thousand billion euros each year for the EU. It's an enormous amount of money that member states cannot invest in social services, schools, healthcare system. We must put an end to this critical phenomenon in all member states.”

Turning to the main measures which he believes could be enforced to help in the fight against money laundering and tax evasion, the MEP said that the current EU legislation concerning anti-laundering activities must be fully enforced and respected. “Very extensive European legislation already exist. For example, a large range of intermediaries must apply due diligence and must denounce operations that appear suspicious to them. After that, the Financial Unit Services must look into each case to determine if a money laundering operation is ongoing. But a couple of member states don't have enough human and financial means to allow for effectiveness.

“The intermediaries (banks, accountants, lawyers) must also comply to the European legislation. If they don't, it's important that they be punished. They play a crucial role in the set up of off shore constructions and we must firmly fight this. And Malta is of course also concerned.”

“Tax heavens must be blacklisted as soon as possible. We must take measures to sanction them, but also against all intermediaries that are doing business with them. The cooperation between member states must be strengthened to fight against financial criminality. Financial criminal activity doesn't know frontiers, and so too must be the case for the fight against it.”

“Finally, regarding tax evasion and tax avoidance, we must continue our efforts to beef up European legislation. The exchange of information between member states is very important. That's why I'm very involved in the works regarding country by country Reporting. I also think we must move towards a fiscal harmonisation between the member states. I know that's the Maltese government does not agree on this, but I will do my best to push for this harmonisation which is so important to prevent tax avoidance and fiscal shopping. I'm convinced that’s a priority for the European left wing.”


  • don't miss