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UK orders foreign firms to disclose property ownership

Foreign companies looking to snap up U.K. property will be forced for the first time to publicly reveal the names of their owners, Prime Minister David Cameron will announce on Thursday.

The new public register will not only apply to new buyers but existing owners of the nearly 100,000 foreign-owned properties across England and Wales, a press release from the prime minister's officer explained.

Disclosure will also be required for those bidding on central government contracts.

Cameron is expected to make the announcement as he plays host at a global Anti-Corruption Summit in London Thursday.

Countries including France, the Netherlands, Nigeria and Afghanistan will also commit to launch similar registries on company ownership. Others like Australia, Ireland, New Zealand and Indonesia are expected to work towards their own disclosure programs.

The U.K.'s registry will be launched next month and see information shared between 40 jurisdictions, including Overseas Territories and Crown Dependencies.

British Prime Minister David Cameron addresses delegates during the Conservative party Spring Forum in central London on April 9, 2016.
Kerry Davies | AFP | Getty Images
British Prime Minister David Cameron addresses delegates during the Conservative party Spring Forum in central London on April 9, 2016.

It's the first major action around the Anti-Corruption Summit, which will provide the first platform for global leaders to pose a united front in the wake of a number of corruption and tax evasion scandals including the Panama Papers leak.

Thursday's event was planned before the International Consortium of Journalists (ICIJ) released the first Panama Papers reports in April, but comes just days after the ICIJ published the entirety of the 11.5 million files that outline personal connections to nearly 214,000 offshore entities.

While using offshore entities isn't inherently illegal, concerns have been raised over their use as tax evasion vehicles and money laundering conduits.

The U.K. Prime Minister is also hoping the summit culminates in leaders signing the first-ever global declaration against corruption, agreeing on a package of "practical steps" to expose and punish perpetrators, support victims, and "drive out the culture of corruption wherever it exists," according to the government's website.

In the meantime, Cameron is set to outline plans for the an International Anti-Corruption Coordination Centre, partnered with Interpol, the US, Australia, Canada, New Zealand and Switzerland.

Cameron will be joined by panelists including World Bank president Jim Yong Kim and International Monetary Fund (IMF) Managing Director Christine Lagarde, while the leaders of Norway, Nigeria, Colombia and Afghanistan will be among the attendees.

Cameron's anti-corruption drive has been overshadowed by his own scandal in the wake of the Panama Papers. He admitted to having previously owned shares in his father's offshore fund, but explained he sold those shares in 2010 before taking his post as U.K. leader.

"It's quite ironic that Cameron himself pledged that he would try fight corruption...he hasn't done anything illegal but ethical questions are being raised," Marianna Fotaki, a professor of business ethics at the Warwick University Business School, told CNBC in a phone interview Tuesday.

"People are asking how honest is David Cameron….is it window dressing or is there substance?"

On Tuesday, Cameron was at the center of another potentially damaging episode, caught on camera telling Queen Elizabeth that leaders of some "fantastically corrupt" countries, including Nigeria and Afghanistan, would attend the summit. A source close to President Muhammadu Buhari of Nigeria told CNBC that his comments were "embarrassing to us, to say the least, given the good work that the President is doing."

"The eyes of the world are on what is happening here. The Prime Minister must be looking at an old snapshot of Nigeria. Things are changing with corruption and everything else," the source added.

Other global leaders, including Russia's President Vladimir Putin, Argentinian President Mauricio Macri, and Ukrainian President Petro Poroshenko, were also found to have links to offshore firms after the release of the Panama Papers, with Icelandic Prime Minister Sigmundur Gunnlaugsson even resigning shortly after their release.

Fotaki, who is an expert on whistleblowing, said real change has to focus on values, where people understand that achieving high profit in the short term, at any cost, is not just ethically dubious but "bad for business." There should also be a push for high levels of openness and transparency that includes public feedback.

"We don't need massive punitive measures, but we need to know that people who contravene the rules will face consequences, irrespective of their position."

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