Digging deeper: How Armenia is leading the way in beneficial ownership transparency
Armenia’s path to beneficial ownership transparency paves the way for greater accountability in extractives and beyond.
Cradled between the Caucasus Mountains and the Ararat Valley, Armenia is known for its rich history and age-old traditions. In recent years, however, the Eurasian nation has made waves on the global stage, not for its cultural heritage, but for its strides in beneficial ownership transparency—a critical area in the fight against corruption. Beneficial ownership transparency reveals the individuals who ultimately own or control companies, ensuring accountability and reducing opportunities for illicit financial flows, conflicts of interest and corruption. Armenia has made transformative progress in this field, positioning itself as a pioneer and setting an example for other nations seeking greater integrity in their extractive sectors.
So, how did Armenia become a frontrunner in beneficial ownership transparency?
A milestone achievement
Armenia’s journey began with a focused effort on the mining sector, which contributes nearly 40% to the country’s exports. In 2020, as part of its commitment to the EITI, the country published its first beneficial ownership declarations for companies operating in the extractive industries. This crucial step shed light on the real owners behind these companies in a sector often plagued with opacity, with an aim to curb corruption, improve accountability and enhance public trust. What began as a sector-specific initiative soon became the testing ground for a wider transparency agenda.
By 2023, Armenia had expanded its ownership disclosure requirements to cover the entire economy.
By 2023, Armenia had expanded its ownership disclosure requirements to cover the entire economy, launching a public beneficial ownership register—the State Register of Legal Entities—which covers approximately 120,000 legal entities and significantly enhances public oversight. Armenia has exceeded the EITI’s requirement on beneficial ownership disclosure, and it continues to make efforts to strengthen and refine procedures to ensure transparency.
The path to beneficial ownership transparency
Armenia’s progress did not happen overnight. The country’s success in beneficial ownership transparency can be traced to several key factors:
1. A robust legal framework
Armenia’s achievement is underpinned by a creating a robust legal framework. Over the past few years, the government has refined its legal definitions of beneficial ownership, aligning them with international best practices and the EITI Standard. Armenia also adopted Open Ownership’s Beneficial Ownership Data Standard (BODS) for the mining sector, becoming one of the first countries to implement this open standard for collecting, sharing and using high-quality data on company ownership.
2. Easy public access to information
The creation of a public beneficial ownership register, hosted by the Ministry of Justice, was a game-changer. It allows the public to easily access ownership information, fostering informed debate and civic engagement. Investigative journalists have particularly leveraged this data to scrutinise corporate structures, expose hidden interests and flag illicit activities. For instance, Civic reported how journalists used beneficial ownership data to reveal connections between high-profile politicians and lucrative mining ventures in Armenia, shedding light on potential conflicts of interest and irregularities in contract awards. The register has also helped uncover tax evasion schemes linked to Armenian companies with international ties.
Investigative journalists have particularly leveraged this data to scrutinise corporate structures, expose hidden interests and flag illicit activities.
3. Reliable, verified data
Ensuring the quality and accuracy of beneficial ownership data has proven challenging, particularly given technical and staffing constraints. To overcome these obstacles, the Armenian government introduced a digital platform for companies to submit declarations, complemented by legislative reforms to support data verification for high-risk cases. These efforts have been bolstered by partnerships with international organisations like the World Bank and the Opening Extractives programme, which have provided technical expertise to improve the reliability and interoperability of beneficial ownership data.
Looking ahead
Armenia EITI is driving forward plans to integrate beneficial ownership data into the process for screening mining license applications to mitigate corruption risks and ensure compliance with sanctions and anti-money laundering regulations. The Ministry of Territorial Administration and Infrastructure has proposed new legislation that would prevent the true owners of companies whose mining rights have been terminated—as well as the owners’ affiliates and close relatives—from acquiring new mining rights for 10 years.
Armenia’s success in beneficial ownership transparency has set a high bar for EITI implementing countries.
Armenia’s success in beneficial ownership transparency has set a high bar for EITI implementing countries. It underscores the importance of a multi-stakeholder process for continuous legal reform, inter-agency cooperation and the integration of beneficial ownership data into government procedures. This progress has been driven by a broad coalition of government officials, civil society, mining industry representatives and international partners. As Armenia forges ahead, its commitment serves as an example for other countries looking to follow suit in the pursuit of greater transparency.
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