Feature: Types of ownership or control

[siwhitehouse]

[This ticket helps track progress towards developing a particular feature in BODS where changes or revisions to the standard may be required. It should be placed on the BODS Feature Tracker, under the relevant status column.

See Feature development in BODS in the Handbook.

The title of this GitHub ticket should be 'Feature: XXXXX' where XXXXX is the feature name below. The information in this first post on the thread should be updated as necessary so that it holds up-to-date information. Comments on this ticket can be used to help track high-level work towards this feature or to refine this set of information.]

Feature name: Types of ownership or control

Feature background

What user needs are met by introducing or developing this feature in BODS? [Summarise these needs. Link to user stories, reports, blogs and other evidence where possible. Or add user stories here directly.]

People publishing and interpreting BODS data should be able to:

• Model forms of ownership or control in a clear and consistent manner
• Access documentation that explains more complex forms of ownership or control and how to model and interpret them
• Model all of the forms of ownership or control in a declaration

There are many ways in which ownership or control of an entity may be exercised. Direct ownership by shareholding and control through being member of a board are widely known and understood. They are also straightforward to model and, once they are modelled, it is relatively easy to publish data that describes them.

The international nature of beneficial ownership means that there are different types of ownership or control that it is desirable for BODS to support. Additionally there are less direct and more complex forms of ownership or control - some of which are constructed to avoid scrutiny - through which influence can be exerted on an entity. These often involve an intermediary of some kind.

We can also expect that new forms of ownership or control will be created in the future. Developing a comprehensive set of existing and emergent forms of ownership and control will enable people publishing BODS data to represent the many ways in which ownership and control is exercised.

What impact would not meeting these needs have?

Publishers may not be able to describe all of the forms of ownership or control of an entity. As a result it may not be possible to describe a complete picture of the ownership or control of an entity. Bad actors will always look for methods to avoid scrutiny and gaps in how BODS can express forms of ownership or control may be exploited by them.

How important is it to meet the above needs?

It is important to meet these needs in order to allow for the most comprehensive picture of the ownership and control of an entity to be published. This should be considered alongside the context that many disclosure regimes will not ask or record more complex methods of ownership or control. Modelling them in BODS can therefore be seen as an exercise in understanding the range of ownership and control mechanisms and therefore being in a position to advocate for their collection, use and publication.

How urgent is it to meet the above needs?
At the moment BODS can represent shareholding, voting rights, appointment of board, senior managing official, settlor, trustee and protector and beneficiary of trust, rights to surplus assets on dissolution, rights to profit or income, rights granted by contract, conditional rights granted by contract and other influence or control.

We have identified the following forms of ownership or control for potential inclusion in BODS:

• Control via an informal agreement
• An interest held through a bearer share
• An interest held through a nominee structure
• Procurement responsibility
• Enjoyment of assets
• Board member
• A limited partnership
• A general partnership
• A contractual joint venture

Some, but not all of which have existing Github issues (see below). We should prioritise the implementation of these based on how simple they are as well as their urgency - which we have not yet determined.

Are there any obvious problems, dependencies or challenges that any proposal to develop this feature would need to address?

Some of the proposals for additional forms of ownership or control to be added depend upon proposed changes to be made to the entity type codelist in BODs, which is not prioritised for BODS v0.3

There has been some discussion about whether BODS should differentiate between ownership or control that is exercised by virtue of a mechanism and by that of a role #327. There is no dependency on this in either direction.

The specific forms of ownership and control that we will include in v0.3 of the BODS schema are not yet determined. Further refinement is needed so that we can define a milestone for the v0.3 release.

Feature work tracking

[Link to proposals, bugs and issues in the repository to help track work on this feature]

#40 [DONE]
#270
#276 [DONE]
#313 [DONE]
#327
#336
#338
#343
#344 [DONE]
#406 [DONE]

[kd-ods]

Just noting here that the specific forms of ownership and control that we will include in v0.3 of the BODS schema are not yet determined. Further refinement is needed so that we can define a milestone for the v0.3 release.

[StephenAbbott]

Pasting a comment here that I just left on #338 as it relates to bearer shares:

#338 (comment)

[StephenAbbott]

Apologies @siwhitehouse. Not quite sure how I clicked to close the issue here before

[siwhitehouse]

I've struckout three issues from the list of proposals attached to this feature:

#270 control-via-financial-agreement
It has a potential dependancy on #327 which is out of scope for 0.3

#327 Interest types & definitions: voting rights, membership & roles vs mechanisms
This includes a proposal to separate roles from mechanisms and involves structural changes to the schema.

#336 Simplify the entity type codelist
This informs the work of some issues but does not involve a change to interest types

[siwhitehouse]

All of the remaining candidate issues involve a change, or changes, to the interestType code list. From the point of view of how much work it will entail to complete each issue then we could consider a couple of factors

1. How complete the research is and how close we are to an agreement about what needs to be done.
   For example, I think we are pretty close to agreement on Proposed changes to interestType values relating to trusts and other legal arrangements #40 and Proposed interest type: representing Bearer Shares #338, whereas Proposed new interestType: 'unknown-interest'  #276 and Proposed interest type: procurement responsibility #343 need some more work to understand the requirements properly.

2. How much documentation in addition to the description in the code list is needed
   For example, Proposed changes to interestType values relating to trusts and other legal arrangements #40 might only need edits to the code list files, whereas Proposed interest type: representing Bearer Shares #338 really needs some additional documentation to explain how we expect people to represent the custodianship of bearer shares.

I think the next step is to estimate the amount of work involved on each of the issues and then prioritise them based on that and how important we think it is to have the changes in for v0.3.

[kd-ods]

The SOE proposal is not dependent on this interests work BUT there are a couple of interest types that would complement SOE modelling:

• controlViaCompanyRulesOrArticles
• controlByLegalFramework

[ScatteredInk]

controlViaCompanyRulesOrArticles
controlByLegalFramework

Yes, I would support adding the two interests above so that we can properly represent state ownership (and the former is important in other contexts too).

[siwhitehouse]

I've raised #406 for the two additional SOE related codelist values

[siwhitehouse]

PR #413 has been raised to implement this feature ticket

[Blueskies00]

@siwhitehouse I've been asked to help with some 0.3 tidying - what would you like to do with this feature ticket? Close it and pick up the interest types not added in a new ticket, or pull it back to the research stage?

[siwhitehouse]

@Blueskies00 wrote:

@siwhitehouse I've been asked to help with some 0.3 tidying - what would you like to do with this feature ticket? Close it and pick up the interest types not added in a new ticket, or pull it back to the research stage?

Thanks. My preference is that we close this feature ticket and then consider how we represent the rest of the work. Quite a few of the issues that we haven't implemented are linked to other issues. We should consider if we want another feature ticket that includes all of the interest types, or if the interest type issues are included in the feature tickets that are dependent on them.

[kathryn-ods]

It looks to me that this ticket can now be closed

[kd-ods]

Related work on interest modelling can be followed here: #466