2013 Lough Erne G8 Leaders' Communique Agreed To By G8 Leaders [FULL TEXT]

Preamble

1. As leaders of the G8, we are committed to open economies, open societies and open governments as the basis of lasting growth and stability. We have today agreed concrete steps to play our part in ensuring a safe and prosperous world.

2. We met at a time of continued economic uncertainty. Our urgent priority is to promote growth and jobs, particularly for the young and long-term unemployed. We will continue to nurture the global recovery by supporting demand, securing our public finances and reforming our economies to deliver growth.

3. Our economies together make up around half of the global economy, and we have a responsibility to support prosperity worldwide. We agreed actions in three specific areas:

-- Trade - a key engine of global economic growth. We will break down barriers to trade at home and abroad by resisting protectionism and concluding a set of ambitious trade deals. In particular, we welcome the launch of negotiations for an EU-US trade agreement, the major progress towards agreeing the Trans Pacific Partnership and the launch of the EU-Japan trade agreement negotiations and we look forward to the completion of the EU-Canada trade agreement. We aim to finalise all these deals as soon as possible. We also welcome the trade and economic integration of Russia with some of the countries in the region, which will be pursued in line with World Trade Organisation (WTO) principles. We are committed to strengthening the multilateral trading system and securing a WTO deal in December that cuts bureaucracy to make it easier and faster for goods to cross borders. And we will keep our promises to help developing countries slash barriers to trade that impede growth.

-- Tax systems – essential to fairness and prosperity for all. We commit to establish the automatic exchange of information between tax authorities as the new global standard, and will work with the Organisation for Economic Cooperation and Development (OECD) to develop rapidly a multilateral model which will make it easier for governments to find and punish tax evaders. On tax avoidance, we support the OECD’s work to tackle base erosion and profit shifting. We will work to create a common template for multinationals to report to tax authorities where they make their profits and pay their taxes across the world. We will support developing countries to collect the taxes owed them, with access to the global tax information they need. We agree to publish national Action Plans to make information on who really owns and profits from companies and trusts available to tax collection and law enforcement agencies, for example through central registries of company beneficial ownership.

-- Transparency – empowering people to hold governments and companies to account. We have agreed a transformative Open Data Charter to make budget data and other government information public in an easily accessible way. We will make progress towards common global reporting standards to make extractive industry payments more transparent. And we will work with resourcerich countries to help them better manage their extractive revenues so as to provide a route out of poverty and reliance on aid.

4. We will continue to work with the poorest countries to help lift people out of poverty by keeping our aid promises and being accountable to the public for them. We will accelerate efforts to tackle the under-nutrition that blights millions of lives. We will work closely with African governments and citizens to promote sustainable growth.

5. We share a commitment to work together to counter terrorism and tackle the drivers of instability wherever in the world they are found and particularly in northern Africa and the Middle East. We have identified five priority areas for action to respond to the growing threat posed by terrorists operating in the arc of instability from Mauritania to Somalia. Alongside the countries themselves, we will work together, focussing our collective political and practical support, to help governments find and dismantle terrorist networks and to build effective and accountable government.

6. We are committed to protecting our nationals and reducing terrorist groups’ access to funding which allows them to thrive. We unequivocally reject the payment of ransoms to terrorists and we call on countries and companies around the world to follow our lead and stamp out this as well as other lucrative sources of income for terrorists. We will help each other to resolve hostage incidents by sharing best practice in advance and offering expertise as necessary when they take place.

7. We strongly support the proposal for a conference to reach a political solution to the appalling conflict in Syria through full implementation of the 2012 Geneva Communiqué. We will contribute generously to the latest United Nations (UN) appeal for humanitarian help. We condemn in the strongest terms any use of chemical weapons and all human rights violations in Syria. We are committed to leading international support for Libya’s security and democratic transition and to urgent work for a lasting peace in the Middle East.

Global Economy

8. Promoting growth and jobs is our top priority. We agreed to nurture the global recovery by supporting demand, securing our public finances and exploiting all sources of growth. The fight against unemployment, particularly long-term and youth unemployment, remains critical in our domestic and collective agendas.

9. Global economic prospects remain weak, though downside risks have reduced thanks in part to significant policy actions taken in the US, euro area and Japan, and to the resilience of major developing and emerging market economies. Most financial markets have seen marked gains as a result. However, this optimism is yet to be translated fully into broader improvements in economic activity and employment in most advanced economies. In fact, prospects for growth in some regions have weakened since the Camp David summit. While countries have taken steps to avoid the worst of the tail risks that faced the world economy in 2012, vulnerabilities remain in 2013, highlighting the need for countries to press ahead with the necessary reforms to restore sustainable growth and jobs.

10. Downside risks in the euro area have abated over the past year, but it remains in recession. Additional strengthening of the architecture of the European Economic and Monetary Union, including through the development of the agreed elements of a banking union, is strongly needed to contribute to further reducing financial fragmentation, and continued strengthening of banks’ balance sheets. Fiscal sustainability and restoring financial stability need to go hand in hand with well-designed growth strategies, including growth-oriented structural reforms. The US recovery is continuing and the deficit is declining rapidly in the context of a continuing need for further progress towards balanced medium-term fiscal sustainability and targeted investments to enhance growth. Japan’s growth will be supported by its near-term fiscal stimulus, bold monetary policy and recently announced strategy for promoting private investment. However, it will need to address the challenge of defining a credible medium-term fiscal plan. Some of our central banks have continued to use highly accommodative monetary policy to support their domestic economies, including through unconventional means such as quantitative easing. Russia is experiencing low unemployment and a favourable fiscal position, but more moderate global growth and volatile commodity prices will be a challenge.

11. In light of this background we are committed to taking further action now to restore confidence, encourage investment and job creation, support the recovery and reduce global imbalances. We agreed today that:

-- Decisive action is needed to nurture a sustainable recovery and restore the resilience of the global economy. Advanced economies need to balance supporting domestic demand with reforms to tackle structural weaknesses that weigh on growth, while implementing credible fiscal plans. We reaffirm our commitment to cooperate to achieve a lasting reduction in global imbalances, which surplus and deficit countries must address.

-- Monetary policy should continue to support the recovery and be directed towards domestic price stability, according to the respective mandates of central banks.

-- Restoring medium-term fiscal sustainability remains a priority. Fiscal policy should allow for near-term flexibility to accommodate economic conditions including through focusing on the structural deficit as appropriate. The pace of fiscal consolidation should be differentiated for our different national economic circumstances.

-- Structural reforms are key to improving sustainable growth and long-term living standards, enhancing competitiveness, providing well-functioning credit channels for investment including by small and medium sized enterprises (SMEs) and strengthening confidence. Urgent and specific measures are needed to create quality jobs, particularly for the young and the long-term unemployed. We are all committed to make the necessary reforms in our own economies to support stronger financial systems, healthy labour markets, jobs and growth, and bolster world trade.

12. Trade and investment are key engines of global economic growth, job creation and sustainable development. The nature of international trade is changing radically, with goods now increasingly produced within complex supply chains that use components from countries that span the globe. Today, nearly 60% of trade in goods is in components. Trade in services also makes a growing contribution to the global economy, and is increasingly bound up with trade in goods. This 21st century reality provides a powerful argument for driving forward free trade based on a fair, strong rules-based trading system, protecting and promoting investments, and deepening economic integration.

13. We are therefore committed to taking steps to unlock further the potential of trade and investment to boost growth, jobs and sustainable development. We will also keep our word to refrain from and roll back protectionist measures and support a further extension of the G20 standstill commitment. We call on others to do the same. We commit our support to efforts to liberalise trade in green goods and services, emphasising that progress in this area will boost green growth. In this regard we commend Asia-Pacific Economic Cooperation’s (APEC) decision in September 2012 to reduce tariffs on environmental goods as an important contribution to this end.

14. As a demonstration of our commitment to open markets we will work to conclude deep, ambitious and genuinely liberalising bilateral, regional and plurilateral agreements. These agreements will address a broad range of issues in addition to tariff reductions, including behind-the-border barriers, rules, and regulatory coherence and better alignment of standards, all of which are central to unleashing the full potential of trade. Such deals will be consistent with and supportive of the WTO framework, acting as building blocks for future multilateral agreements in the WTO, which ultimately remain the most effective means of reducing trade barriers globally.

15. We reiterate our support for the central role of the WTO in setting the rules that underpin global trade, in bringing down the barriers to trade that currently inhibit global growth, in resisting and rolling back protectionism and in ensuring proper rules enforcement for a level playing field in world trade. We support the continued provision of an effective protectionism monitoring mechanism and measures to further strengthen the peer review process in the WTO. We welcome the new Director-General and pledge our support for efforts to build a strong agenda that maintains the centrality of the WTO.

16. Cutting the costs of trade by reducing and streamlining bureaucracy at borders would benefit everyone and could boost the global economy by $1 trillion. It would open new export opportunities for developing countries, boosting jobs and growth. Better border procedures will also improve customs and tax collection in developing countries. We will therefore make determined efforts to reach agreement at the 9th WTO Ministerial Conference in Bali in December on a package that has Trade Facilitation at its core. We note that achieving this goal requires contributions from all major WTO partners. A successful Bali Ministerial would pave the way for a reinvigorated WTO negotiating agenda.

17. Every Aid for Trade dollar spent on tackling trade bureaucracy can increase the recipient’s trade by almost $700 each year. We stand ready to continue to provide, within our current Aid for Trade commitments, substantial technical assistance and capacity building to help implement a WTO Trade Facilitation deal, in particular to the benefit of the Least Developed Countries. We will also be more transparent in reporting the aid we provide, and work with developing countries, especially the poorest, to ensure that resources are better matched to needs.

Africa Trade and Infrastructure

18. Africa is the next emerging continent, with a growing share of the world’s trade, investment and economic output. We have an historical opportunity to work with our African partners to help promote inclusive and resilient growth in Africa, through greater transparency, improved infrastructure, better trade facilitation, the elimination of trade barriers and the management of natural resources. We welcome the contribution of the Fifth Tokyo International Conference on African Development (TICADV) to advancing these objectives.

19. The G8 strongly welcomes Africa’s own regional integration agenda, which would reduce barriers to trade and continue to unlock the internal potential of Africa. We support the African Union’s (AU) Action Plan on Boosting Intra-African Trade (BIAT). Cutting transit times will boost African trade within the continent and with global markets. The G8 will work with African countries and regional economic communities to meet the AU’s target of doubling intra-Africa trade and reducing crossing times at key border posts by 50% by 2022.

20. More effective border crossings and increased trade need investment in infrastructure, including transport, energy and telecommunications. In particular, better project preparation and risk mitigation efforts are required to boost private investment. The G8 commits to provide increased support for project preparation facilities for African regional infrastructure programmes and recognises the importance of the New Partnership for Africa’s Development (NEPAD) Infrastructure Project Preparation Facility hosted by the African Development Bank and other similar mechanisms.

21. The G8 urges multilateral development institutions to establish and prioritise, as part of ongoing work on International Development Association-17, African Development FundPage 13 and European Development Fund-11 replenishments, more effective mechanisms forcollaboration on project preparation, funding and risk mitigation for Africa’s regional infrastructure programmes, such as the Programme for Infrastructure Development (PIDA). The G8 recognises the work being done by the G20 on financing for infrastructure in Africa.

22. The G8 commits to explore and identify in advance of our next meeting the further steps it can take together or individually, in collaboration with the private sector, International Financial Institutions (IFIs) and other international organisations to facilitate institutional investment flows into bankable trade-related infrastructure projects in developing countries.

Tax

23. As we strive to maintain fiscal sustainability and to secure jobs and growth for our citizens, we commit to playing our part in developing global solutions to the problems of tax evasion and tax avoidance. We will act to restore confidence in the fairness and effectiveness of our international tax rules and practices, and to ensure that each country is able to collect taxes owing and that developing countries are also able to secure the benefits of progress made on this agenda.

24. We welcome the OECD work on addressing Base Erosion and Profit Shifting (BEPS) by multinational enterprises and emphasise the importance of the OECD developing an ambitious and comprehensive action plan for the Finance Ministers and Central Bank Governors of the G20 in July. We look forward to the OECD recommendations and commit to take the necessary individual and collective action. We agree to work together to address base erosion and profit shifting, and to ensure that international and our own tax rules do not allow or encourage any multinational enterprises to reduce overall taxes paid by artificially shifting profits to low-tax jurisdictions. The ongoing OECD work will involve continued engagement with all stakeholders, including developing countries.

25. Comprehensive and relevant information on the financial position of multinational enterprises aids all tax administrations effectively to identify and assess tax risks. The information would be of greatest use to tax authorities, including those of developing countries, if it were presented in a standardised format focusing on high level information on the global allocation of profits and taxes paid. We call on the OECD to develop a common template for country-by-country reporting to tax authorities by major multinational enterprises, taking account of concerns regarding non-cooperative jurisdictions. This will improve the flow of information between multinational enterprises and tax authorities in the countries in which the multinationals operate to enhance transparency and improve risk assessment.

26. A critical tool in the fight against tax evasion is the exchange of information between jurisdictions. We see recent developments in tax transparency as setting a new standard and commit to developing a single truly global model for multilateral and bilateral automatic tax information exchange building on existing systems. We support the OECD report on the practicalities of implementation of multilateral automatic exchange and will work together with the OECD and in the G20 to implement its recommendations urgently. We call on all jurisdictions to adopt and effectively implement this new single global standard at the earliest opportunity. It is important that all jurisdictions, including developing countries, benefit from this new standard in information exchange. We therefore call on the OECD to work to ensure that the relevant systems and processes are as accessible as possible to help enable all countries to implement this new standard.

Tax and Development

27. It is in everyone’s interests for developing countries to be able to: strengthen their tax base to help create stable and sustainable states; improve their ability to fund their budgets through their own domestic revenues; and increase ownership of their own development processes. We will continue to provide practical support to developing countries’ efforts to build capacity to collect the taxes owed to them and to engage in and benefit from changing global standards on exchange of information, including automatic exchange of information. We call on all jurisdictions to join the Global Forum on Transparency and Exchange of Information for Tax Purposes and the Multilateral Convention and we will continue to provide practical support for developing countries seeking to join the Global Forum. We each commit to continue to share our expertise, help build capacity, including by engaging in long-term partnership programmes to secure success.

28. We welcome the OECD’s feasibility study for its Tax Inspectors Without Borders proposal to assist tax administrations investigate specific and complex tax cases. We will take practical steps to support this initiative, including by making tax experts available.

29. The ability of tax administrations to compare relevant price information across jurisdictions is essential for the effective operation of transfer pricing rules, and a lack of data on comparable transactions is a significant issue for effective tax collection, particularly in developing countries. We ask the OECD to find ways to address the concerns expressed by developing countries on the quality and availability of the information on comparable transactions that is needed to administer transfer pricing effectively.

Transparency of companies and legal arrangements

30. A lack of knowledge about who ultimately controls, owns and profits from companies and legal arrangements, including trusts, not only assists those who seek to evade tax, but also those who seek to launder the proceeds of crime, often across borders. Shell companies can be misused to facilitate illicit financial flows stemming from corruption, tax evasion and money laundering. Misuse of shell companies can be a severe impediment to sustainable economic growth and sound governance. We will make a concerted and collective effort to tackle this issue and improve the transparency of companies and legal arrangements. Improving transparency will also improve the investment climate; ease the security of doing business and tackle corruption and bribery. It will support law enforcement’s efforts to pursue criminal networks, enforce sanctions, and identify and recover stolen assets.

31. We are determined to take action to tackle the misuse of companies and legal arrangements. We will lead by example in our implementation of the Financial Action Task Force (FATF) standards. We today agreed to publish national Action Plans based on common principles (annexed). Subject to our different constitutional circumstances, these Action Plans set out the concrete action, with respect to money laundering and tax evasion, each of us will take to tackle this issue to ensure that companies know who really owns and controls them by requiring companies to obtain and hold information on their beneficial ownership, and to ensure that this information is available in a timely fashion to law enforcement, tax collection agencies and other relevant authorities as appropriate, including financial intelligence units, for example through central registries; and by ensuring trustees know the beneficial ownership information regarding the trust and that law enforcement, tax collection agencies and other relevant authorities as appropriate, including financial intelligence units, can access this information. We will work with our FATF partners to ensure ambitious progress at a global level, including by prioritising the assessment of relevant FATF recommendations.

Anti-Money Laundering

32. Our financial systems are exposed to significant risks from money laundering and terrorist financing. We fully support the FATF Standards and commit to implementing them effectively. We support the FATF’s identification and monitoring of high risk jurisdictions with strategic anti-money laundering and counter-terrorist financing (AML/CFT) deficiencies, and encourage all countries to take measures to ensure they meet the FATF standards. We are committed to ensuring proportionate and effective supervision and enforcement of our AML/CFT requirements to ensure corporate wrongdoers are held to account.

33. Taking measures to enhance financial transparency would also improve the opportunities for African business and for markets to expand. As African economies grow, African financial institutions will increasingly risk exposure to illicit financial activity, affecting the opportunities for African business and markets to expand. We will hold the first Public-Private Sector Dialogue with Eastern and Southern African nations on 6-8 September in Swakopmund, Namibia, involving governments and financial institutions from the G8 and the region. This will provide a platform for greater ongoing collaboration, dialogue and public-private sector partnership, and we will consider extending the Dialogue to other regions on an annual basis.

Extractives

34. Natural resources have the potential, if developed and managed responsibly, in line with internationally recognised environmental and social standards, to be a key driver of strong and sustainable growth, especially in developing countries with an abundance of natural resources. To illustrate, oil exports in 2010 from a single African country exceeded total net aid to sub-Saharan Africa. These resources offer a long term route out of poverty for many developing countries and an opportunity to reduce dependence on external assistance.

35. However, the lack of strong systems of transparency and accountability in the management of the extractive sector in some resource-rich countries has too often allowed revenues to be diverted from high-priority national needs. Raising global standards of transparency in the extractive sector and building the capacity of countries to manage their resources effectively will improve accountability, reduce the space for corruption and other illicit activities and ensure that citizens benefit fully from the extraction of natural resources.

36. The G8 will take action to raise global standards for extractives transparency and make progress towards common global reporting standards, both for countries with significant domestic extractive industries and the home countries of large multinational extractives corporations. Under such common standards companies would be required to report on extractives payments, governments would take steps to ensure disclosure compliance, and those governments that wish to move towards the Extractives Industries Transparency Initiative (EITI) standard will voluntarily report their revenues. This would reduce reporting burdens on businesses, help to fight corruption, and encourage more effective and efficient investment, including in developing countries.

37. Thirty-nine countries have signed up to the EITI, which increases transparency and accountability in the payments companies make and the revenues governments receive for their natural resources. We welcome the new EITI rules adopted in May, which aim to increase the coverage and accessibility of data produced by EITI countries and ensure that participating countries are held to a high standard. We encourage other countries to sign up to the EITI.

38. The US has adopted legislation requiring certain publicly traded extractives companies to report their payments to governments around the world. The EU Accounting and Transparency Directives will introduce equivalent standards for EU Member States. EU G8 members will quickly implement the EU Accounting and Transparency Directives. These will require mandatory reporting of payments to governments by all listed and large unlisted extractive companies in the EU to all governments, and are consistent with

section 1504 of the US Dodd Frank legislation and the new EITI standard. The US, UK and France will seek candidacy status for the new EITI standard by 2014. Canada will launch consultations with stakeholders across Canada with a view to developing an equivalent mandatory reporting regime for extractive companies within the next two years. Italy will seek candidacy status for the new EITI standard as soon as possible. Germany is planning to test EITI implementation in a pilot region in view of a future candidacy as implementation country. Russia and Japan support the goal of EITI and will encourage national companies to become supporters.

39. We encourage other countries that host major multinational or state-owned enterprises that invest abroad to implement equivalent mandatory reporting rules with a view to creating an international reporting regime that avoids duplicate reporting burdens on business. These global standards should move towards project-level reporting.

40. As part of our commitment to extractives transparency, we continue to support responsible, conflict-free sourcing of minerals from conflict-affected regions, including gold, diamonds and other precious stones. We will promote positive economic development and responsible sourcing in the artisanal mining sector, particularly from conflict and high-risk areas. We reaffirm our continued support for the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, and the International Conference of the Great Lakes Regional Certification Mechanism as part of global multilateral, multi-stakeholder efforts to combat the trade in conflict minerals through certification, responsible business conduct and respect for human rights. We also reaffirm our support for the Kimberley Process as the global, multi-stakeholder initiative to curb the trade in “conflict diamonds” and encourage the Kimberley Process to resolve discussions concerning the definition of “conflict diamond”.

41. We welcome the leadership of the AU and the Intergovernmental Forum on Mining in promoting good governance and transparency in the extractive sector including through the African Mining Vision, the African Mineral Development Centre and the Mining Policy Framework. We also welcome the increasing interest of the NEPAD on these issues. The technical assistance provided to strengthen the capacities of the developing countries to negotiate natural resources contracts is paramount. We welcome the financial support provided to the African Development Bank’s African Legal Support Facility and the Facility for Fair Exploitation of Extractive Resources in Africa, and encourage other countries to commit to these facilities. In support of such initiatives, we will partner with resource rich developing countries, the private sector and civil society to strengthen capacity and increase transparency in the extractive sectors.

42. We have this week launched initial partnerships with Burkina Faso (France), Colombia (EU), Ghana (UK), Mongolia (Germany), Burma/Myanmar (US), Guinea (US), Peru (Canada) and Tanzania (Canada). Italy is on track to finalise a partnership with an African country. They will be tailored to the needs of each country and support national development plans with the objective of improving transparency and governance in the extractive sector by 2015.

Land

43. Weak land governance and property rights systems can lead to opaque land deals, which facilitate corruption and undercut responsible actors seeking access to land for productive investment. Weak governance in many developing countries allows unproductive land speculation and undermines agricultural productivity. Increasing security of land rights and transparency of land governance fosters participation of citizens, contributes to government accountability, reduces costs for businesses, and strengthens the climate for responsible investment. We welcome global activities to improve land tenure governance, including through access to information and participation of citizens in decision making. We acknowledge the importance of multilateral efforts to promote greater land transparency, in particular, the role of the Food and Agriculture Organisation (FAO) in providing global policy guidance for good land governance and transparency. We welcome the launch of the consultations on the principles for Responsible Agricultural Investment (rai), highlighting that good governance in the land sector is central to rural development, food security and sustainable public and private agricultural investment.

44. We will support greater transparency in land transactions including at early stages, and increased capacity to develop good land governance systems in developing countries. Last year, the G8 welcomed the UN Committee on World Food Security’s Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security (VGGT). To implement them, and to support regional processes such as the Land Policy Initiative of the AU, this year we are establishing partnerships with certain developing countries and relevant international organisations to accelerate and target support to countries’ existing land governance programmes in conjunction with businesses, in particular farmers, and civil society.

45. We have this week launched initial partnerships with Burkina Faso (US), South Sudan (EU), Namibia (Germany), Nigeria (UK), Niger (EU), Senegal (France) and Tanzania (UK). They will be tailored to the needs of each country and support national development plans with the objective of improving land governance and in particular transparency in land transactions by 2015. In addition, Japan and Italy are providing increased support through FAO and World Bank to support implementation of the VGGT in developing countries.

Open Data

46. Open government data are an essential resource of the information age. Moving data into the public sphere can improve the lives of citizens, and increasing access to these data can drive innovation, economic growth and the creation of good jobs. Making government data publicly available by default and reusable free of charge in machinereadable, readily-accessible, open formats, and describing these data clearly so that the public can readily understand their contents and meanings, generates new fuel for innovation by private sector innovators, entrepreneurs, and non-governmental organisations. Open data also increase awareness about how countries’ natural resources are used, how extractives revenues are spent, and how land is transacted and managed.

47. We have today agreed and published an Open Data Charter (annexed) with the following principles:

-- Open Data by Default – foster expectations that government data be published openly while continuing to safeguard privacy;

-- Quality and Quantity – release quality, timely and well described open data;

-- Useable by All – release as much data in as many open formats as possible;

-- Releasing Data for Improved Governance – share expertise and be transparent about data collection, standards and publishing processes;

-- Releasing Data for Innovation – consult with users and empower future generations of innovators.

48. This Open Data Charter will increase the supply of open government data across a number of key categories including health, environment and transport; support democratic processes; and ensure that all data supplied are easy to use. We encourage others to adopt this Charter. G8 members will, by the end of this year, develop action plans, with a view to implementation of the Charter and technical annex by the end of 2015 at the latest. We will review progress at our next meeting in 2014.

49. In keeping with the Open Data Charter principles, transparent data on G8 development assistance are also essential for accountability. We have all agreed to implement the Busan Common Standard on Aid Transparency, including both the Creditor Reporting System of the OECD Development Assistance Committee and the International Aid Transparency Initiative (IATI), by 2015. To show greater G8 leadership we will ensure data on G8 development assistance is open, timely, comprehensive and comparable.

50. G8 members should over time apply the Busan common transparency standards to their respective Development Finance Institutions and international public climate finance flows consistent with the reporting of climate finance under the UN Framework Convention on Climate Change (UNFCCC).

Accountability

51. We are committed to holding ourselves to account for the promises we have made in an open and transparent way as agreed at L’Aquila in 2009. We welcome the Lough Erne Accountability Report 2013 – a comprehensive report covering the 56 development commitments that were the subject of the 2010 Comprehensive Accountability Report and the additional commitments Leaders made at Muskoka, Deauville, and Camp David Summits. We reaffirm our determination to continue working with partner countries and other stakeholders to end extreme poverty, building on our shared experiences and addressing new challenges under country-owned strategies. Transparency and mutual accountability remain cornerstones of our approach.

52. The Report shows good progress in areas such as supporting maternal and child health; access to clean water; improving food security; and helping to build peace and security, particularly in Africa. But it also identifies that more action is required to deliver on our promises in some areas. In addition to working on existing commitments, we also recognise the need to face up to and address new challenges in close partnership with others.

Food Security and Nutrition

53. G8 members reaffirm their commitment to respond with the scale and urgency needed to achieve sustainable global food and nutrition security, and note that we have met our financial pledges made at L’Aquila in 2009 and will work to complete disbursements. We reaffirm our commitment to the New Alliance for Food Security and Nutrition and welcome progress since its launch in 2012. We reaffirm our commitment to the Comprehensive Africa Agriculture Development Programme (CAADP) as the guiding framework for agricultural transformation in Africa, recognising the New Alliance as a means to increase private sector investment in support of CAADP Country Investment Plans. We will build on the achievements of the US G8 Presidency by advancing action in four areas:

-- Leadership - by reinforcing African ownership and establishing the Leadership Council as the primary oversight body for the New Alliance;

-- Accountability - by agreeing a credible and effective way to track and report transparently on progress, aligned with the CAADP monitoring framework;

-- Expansion - by expanding participation in the New Alliance by African countries, global and African private sector, and development partners;

-- Deepening impact - by ensuring that investments have a measurable impact on reducing poverty and malnutrition, particularly for smallholders and women, and are made responsibly and support the sustainable use of natural resources.

54. The progress report to the New Alliance Leadership Council highlights the creation of partnership agreements in six African countries; progress made implementing policy reforms and catalysing private sector investment; and the launch of tools to mobilise capital, improve access to new technology, manage risk and improve nutrition. We welcome expansion of the New Alliance to include Nigeria, Benin and Malawi and the initial steps to develop a new Cooperation Framework with Senegal. We recognise the critical role played by smallholder farmers, especially women. We welcome the establishment of a robust system to track results integrated into the CAADP monitoring framework. G8 Members continue to support the Global Agriculture and Food Security Programme to finance country-owned agricultural development activities, especially those that achieve positive nutrition outcomes, and to leverage greater flows of private capital to smallholder farmers and agribusinesses in low-income countries.

55. We welcome the recently announced Global Nutrition for Growth Compact which commits to under-nutrition reduction targets for 2020. We also welcome the financial and policy commitments to accelerate progress towards ending under-nutrition for women and young children. Progress on these commitments should be regularly reported and reviewed, including through the Scaling-Up Nutrition Movement, which we continue to support.

Climate Change

56. Climate change is one of the foremost challenges for our future economic growth and well-being. We remain strongly committed to addressing the urgent need to reduce greenhouse gas emissions significantly by 2020 and to pursue our low carbon path afterwards, with a view to doing our part to limit effectively the increase in global temperature below 2ºC above pre-industrial levels, consistent with science.

57. We will pursue ambitious and transparent action, both domestically and internationally, in the UNFCCC, complemented by actions addressed through other relevant fora, including but not limited to:

-- the Major Economies Forum (MEF), where we will work with our partners to secure progress on the MEF Action Agenda and to overcome differences on the road to the global deal in 2015;

-- the International Civil Aviation Organisation (ICAO), where we call for the agreement at the Assembly in September 2013 on an ambitious package related to both market-based and non-market based measures to address rising aviation emissions;

-- the International Maritime Organisation (IMO), where we continue to work together on further measures to address the issue of shipping emissions;

-- the Climate and Clean Air Coalition which we all committed to join at our last Summit, where we will build on the eight global initiatives already begun and further develop the scientific evidence base and private sector involvement.

58. We recognise climate change as a contributing factor in increased economic and security risks globally. The G8 has agreed to consider means to better respond to this challenge and its associated risks, recalling that international climate policy and sustainable economic development are mutually reinforcing.

59. In the UNFCCC we will work to ensure that a new protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all parties is adopted by 2015, to come into effect and be implemented from 2020. We also note with grave concern the gap between current country pledges and what is needed, and will work towards increasing mitigation ambition in the period to 2020. We reiterate our commitment to the developed countries’ goal of mobilising jointly $100billion of climate finance per year by 2020 from a wide variety of sources in the context of meaningful mitigation actions and transparency on implementation and are advancing our efforts to continue to improve the transparency of international climate finance flows. We welcome the efforts of the Secretary-General of the United Nations to mobilise political will through 2014 towards a successful global agreement in 2015 during the Conference of the Parties that France stands ready to host. We look forward to the fifth Assessment Report of the International Panel on Climate Change (IPCC).

Deauville Partnership with Arab Countries in Transition

60. The aspirations of the people of the Middle East and North Africa (MENA) for freedom, dignity and opportunity remain undiminished. Progress has been achieved. But the region continues to face serious challenges. We pledge our continued support for the political and economic reforms in the region and encourage Leaders of Arab Countries in Transition to continue to make progress through the difficult transition toward democracy, prosperity, open economies and more inclusive societies, including respect for the rights of women and girls and the right to practice religious faith in safety and security.

61. Through co-ordinated bilateral and multilateral support, we will help countries in transition work towards achieving the economic stability, structural reform, and good governance and anti-corruption reforms necessary to enable sustainable and inclusive growth and create jobs.

62. We will continue to support country-led reforms, including projects to support institutional reform, enhanced trade, investment and job creation, including through the MENA Transition Fund, alongside other support from Partners. We welcome the approval of around $100million of projects in the Fund’s first year of operation and encourage partners to deliver on pledges made to date and to increase contributions to ensure the initial capitalization of $250million is met. We further welcome and encourage new donors to the Fund beyond the Partnership.

63. We will continue to support greater trade, investment and economic integration in the region, including through ambitious bilateral trade and investment agreements and improved access to capital for governments and businesses. We hope soon to welcome Yemen into the WTO and support Libya’s path to accession. We welcome the investments in the region by the IFIs and international organisations. We welcome the imminent ratification by all members of the extension of the European Bank for Reconstruction and Development’s geographical mandate to facilitate further investment in transition countries. We recognise the critical role played by young people, women and SMEs in economic stability and growth. We will continue to work with the IFIs to take forward the SME action plans in parallel with a new initiative to provide mentoring support to SMEs.

64. We reiterate our high level of commitment to return stolen assets to countries in transition, including through participation in the Arab Forum on Asset Recovery. We will continue to strengthen cooperation on bilateral casework and develop further the collaboration among our practitioners. Each G8 country will present a road-map by the second Arab Forum on Asset Recovery (AFAR II) in October 2013 that sets out the steps we are taking to meet our commitments under the 2012 Asset Recovery Action Plan. We will enhance coordination in our provision of capacity-building and technical assistance. We will work to agree and adopt principles of good practice in the transliteration of Arabic names in our legal documents by AFAR II. We will support the development of an active law-enforcement network on asset recovery in the Middle East/North Africa region.

65. In line with the G8 tradition of accountability, Foreign Ministers of the Partnership will consider a report on an assessment of progress against commitments at their meeting in September 2013.

Counter Terrorism

66. We reiterate our condemnation of terrorism in all its forms and manifestations, and wherever it occurs. We remain concerned about the increasingly fragmented and geographically diverse threat posed by terrorist groups including al-Qaeda and its affiliates. None of us are immune: since Camp David every G8 partner has been directly affected by acts of terrorism, either at home or overseas. We recognise the valuable leadership role of the UN, including through its Global Counter Terrorism Strategy, the work of the Roma Lyon Group and the importance of the Global Counter Terrorism Forum (GCTF). We are committed to working together to reduce the risk of terrorism for our own citizens, including from home-grown terrorism, and for our partners overseas. Our response must be robust, intelligent and based on a comprehensive approach, respecting human rights and the rule of law, which counters radicalisation, violent extremism and terrorist financing (including flows channelled through off-shore jurisdictions), and which tackles the conditions and grievances that terrorists seek to exploit.

67. While recognising the global threat from terrorism, recent developments in Africa, notably in an arc running from Mauritania in the west to Somalia in the east, show how terrorism combines with other factors to threaten stability and economic interests. That is why we support efforts to dismantle the terrorist safe haven in northern Mali. We welcome France’s important contribution in this regard. Following the successful international high-level donors’ conference to Brussels on 15 May, we support the swift deployment of a UN stabilisation force in Mali, and encourage the Government of Mali energetically to

pursue a political process which can build long-term stability. We also support the Federal Government of Somalia as it re-establishes peace and security after years of conflict fuelled by terrorist groups and commend the commitment of AU Mission in Somalia (AMISOM) forces. We support the Government’s efforts to set up a robust, impartial and effective justice system. We support the Somali Government’s efforts to introduce economic reforms which will help facilitate the welcome process of Somalia’s re-engagement with the IFIs.

68. We need a co-ordinated and coherent approach to tackle the spread of terrorism and address the drivers of instability in northern Africa and the Sahel. We will seek to reinforce the work being taken forward in this area, including by the UN, EU, AU, Economic Community of West Africa States (ECOWAS) and the GCTF. We have identified five priority areas for action in those countries in northern Africa where the problems of terrorism and its drivers are most profound. We will take forward this work in close co-operation with the countries themselves.

69. Building security and rule-of-law capacity. We will work individually and collectively, including through the UN, AU, and GCTF to help build capacity to identify, disrupt and prosecute terrorist activity, while respecting human rights. We will also support multinational efforts, including the EU Training Missions in Mali and Somalia, and welcome the establishment of the International Institute of Justice and Rule of Law in Tunisia.

70. Tackling criminal trafficking and strengthening border security. We will offer political and practical support to those regional and international organisations leading efforts to enhance the ability of countries to monitor and control their borders and to tackle facilitating factors such as corruption, transnational organised crime and illicit trafficking of drugs and people, which undermine governance and the rule of law and in some cases provide an important source of funding for terrorists. We recognise the important work of the UN Office on Drugs and Crime (UNODC) in this regard. We encourage the UNODC (with GCTF and ECOWAS supporting) to convene a high-level meeting to bring together the countries of the region, donors and those with relevant expertise to look at the particular challenges facing North and West Africa, including cooperation in tackling, by a variety of means, terrorist groups that move across borders. We will also take action to tackle the illegal trafficking of protected or endangered wildlife species.

71. Countering violent extremism. We will support work to counter violent extremism, in particular addressing extremist narratives that seek to justify terrorist activity in these countries, including supporting the GCTF and its work to develop the Hedayah Centre, the first international centre of excellence on countering violent extremism. We are also dedicated to enhancing cooperation to tackle the escalating risks of recruitment and radicalisation, including through providing support to vulnerable communities, and building capacity to counter violent extremism.

72. Reducing the vulnerability of multinational companies. Foreign direct investment helps deliver economic growth and is a means to tackle instability. We welcome the intention of the Roma Lyon Group to develop a set of principles to guide our work with multinational companies, supporting them to operate securely in high threat environments, whilst protecting their staff and equities from terrorism. Once agreed, we will aim to encourage adoption of these principles on a global basis.

73. Addressing the wider drivers of instability. Poverty and socio-economic disparities contribute to instability and are exploited by terrorists. We will support the efforts of international and regional organisations, including the IFIs to promote sustainable development and economic growth in northern Africa helping to create the conditions that give people a stake in stability, security and the rule of law. Through the EITI and mandatory disclosure requirements as appropriate, we will also encourage transparent and accountable management of mineral resources. We endorse the work done to improve agriculture and livelihoods through the leadership of the Alliance Globale pour l’Initiative Résilience-Sahel (AGIR-Sahel) process. And we will support the transition of Arab Spring countries across North Africa through the Deauville Partnership working for open economies and inclusive growth.

74. We are determined to use our collective resources to deliver progress in these areas. This collective effort will be augmented by bilateral cooperation that reflects our different historical, economic, cultural and political ties to the countries of northern Africa and the Sahel, and our traditional areas of capacity-building expertise. We have agreed to hold a further G8 meeting later this year, at the level of National Security Advisers or other senior officials, and involving regional and international partners, to review progress and further our objectives.

The threat posed by kidnapping for ransom by terrorists and the preventive steps the international community can take

75. The international community has made significant progress in combating the flow of funds to terrorist organisations. However, in the last three years, we estimate that Al Qaeda-affiliated and other Islamist extremist groups worldwide have collected tens of millions of dollars in ransoms. Payments to terrorists from Sahel to the Horn of Africa helped fuel instability in the region, and contributed to large scale attacks like In Amenas. The payment of ransoms to terrorist groups is one of the sources of income which supports their recruitment efforts, strengthens their operational capability to organise and carry out terrorist attacks, and incentivises future incidents of kidnapping for ransom, thereby increasing the risks to our nationals.

76. We are committed to protecting the lives of our nationals and reducing terrorist groups’ access to the funding that allows them to survive and thrive in accordance with relevant international conventions. We unequivocally reject the payment of ransoms to terrorists in line with the UN Security Council Resolution 1904 (2009) which requires that Member States prevent the payment of ransoms, directly or indirectly, to terrorists designated under the UN Al Qaeda sanctions regime through the freezing of funds and other assets.

77. We welcome efforts to prevent kidnapping and to secure the safe release of hostages without ransom payments, such as those recommended by the GCTF, specifically in the Algiers Memorandum on Good Practices on Preventing and Denying the Benefits of Kidnapping for Ransom by Terrorists. We encourage further expert discussion, including at the Roma Lyon group, to deepen our understanding of this problem. We also encourage private sector partners, including aid and media organisations, travel and insurance companies, and other businesses to adopt their own similar guidelines and good practices for preventing and responding to terrorist kidnaps.

78. We continue to support efforts to reduce terrorist groups’ access to funding and financial services through the ongoing work of the FATF to improve anti-money laundering and terrorist financing frameworks worldwide. We call on all countries to effectively implement the revised FATF Standards.

79. But when the worst happens, we agree to provide mutual assistance to States responding to terrorist kidnaps including, as appropriate and feasible, through information sharing and specialist expertise or assistance, or the provision of resources related to hostage rescue. We will also support capacity-building initiatives to help states prevent, and prepare to respond to future terrorist kidnaps including through bringing terrorists to justice more effectively and ensuing that they do not avoid responsibility.

80. We call on discussions at the UN on new mechanisms to increase international awareness of the threat of kidnapping for ransom, and propose consideration of further UN Security Council resolutions to address and mitigate the threat.

81. We strongly support efforts by the international community to tackle other forms of kidnapping and to reduce the threat of piracy.

Foreign Policy

82. We are determined to work together to stop the bloodshed and loss of life in Syria and to support the Syrian people to establish peace and stability through political means. We are gravely concerned at the appalling human tragedy that the UN estimates has cost the lives of over 93,000 people and led to 4.2 million internally displaced persons and 1.6 million refugees. We acknowledge the vital humanitarian role played by neighbouring countries hosting Syrian refugees, above all Lebanon and Jordan, in dealing with the significant economic and security pressures they are facing as a result of the conflict and refugee influx.

83. Given the extraordinary humanitarian need as reflected in the latest UN appeal for $5.2 billion in 2013, we are resolved to make exceptional contributions commensurate with the scale of the problem. At this meeting G8 Leaders confirmed additional contributions of almost $1.5 billion to meet humanitarian needs in Syria and its neighbours. We recognise that further contributions will be needed given the scale of the challenge. We urge other countries and organisations to make similar commitments. We call for aid agencies to be given immediate access to provide humanitarian assistance to all civilians in need, in accordance with humanitarian principles and international law, particularly in the worst affected areas such as Qusayr.

84. We remain committed to achieving a political solution to the crisis based on a vision for a united, inclusive and democratic Syria. We strongly endorse the decision to hold as soon as possible the Geneva Conference on Syria to implement fully the Geneva Communiqué of 30 June 2012, which sets out a number of key steps beginning with agreement on a transitional governing body with full executive powers, formed by mutual consent. As the Geneva Communiqué says, the public services must be preserved or restored. This includes the military forces and security services. However all governmental institutions and state offices must perform according to professional and human rights standards, operating under a top leadership that inspires public confidence, under the control of the transitional governing body.

85. Both sides at the Conference must engage seriously and constructively. They should be fully representative of the Syrian people and committed to the implementation of the Geneva Communiqué and to the achievement of stability and reconciliation. We will engage actively with the parties in order to achieve successful outcomes.

86. We are deeply concerned by the growing threat from terrorism and extremism in Syria, and also by the increasingly sectarian nature of the conflict. Syria must belong to all Syrians, including its minorities and all religious groups. We call on the Syrian authorities and opposition at the Geneva Conference jointly to commit to destroying and expelling from Syria all organisations and individuals affiliated to Al Qaeda, and any other nonstate actors linked to terrorism. We will support UN planning for Syria’s transition, recovery, and reconstruction needs, in particular by maintaining continuity of state institutions during transition and helping to ensure that the security forces are effective, accountable and able to deal with the threat of terrorism and extremism.

87. We condemn any use of chemical weapons in Syria and call on all parties to the conflict to allow access to the UN investigating team mandated by the UN Secretary-General, and drawing on the expertise of the Organisation for the Prohibition of Chemical Weapons (OPCW) and World Health Organisation (WHO), in order to conduct an objective investigation into reports of use of chemical weapons. The UN team should make their report and deliver it to the UN Security Council for their assessment. We are determined that those who may be found responsible for the use of chemical weapons will be held accountable. We emphasise the need for the secure and safe storage of all chemical weapons in Syria, pending their destruction under international verification. We also condemn in the strongest possible terms all human rights violations and abuses in Syria, committed by anyone, including indiscriminate attacks on civilians. We call on all sides to respect international humanitarian and human rights laws, noting the particular responsibility of the Syrian authorities in this regard.

88. Following the elections in Libya last year, the first for over four decades, we welcome the progress made by the Libyan government under the stewardship of Prime Minister Zeidan. We encourage the government to continue this progress, delivering concrete results. To ensure an effective transition to a more stable, democratic and prosperous future, we urge continued and sustained engagement by the international community, coordinated by the UN Support Mission in Libya (UNSMIL). This engagement should support the Libyan Government’s efforts to increase the effectiveness and capacity of its security and justice sector institutions, to complete a successful transition to democracy, and, following four decades of mismanagement, to develop the Libyan economy and to improve the provision of public services. We encourage all Libyans to engage with the political process of reconciliation and constitutional reform through peaceful and inclusive means, underpinned by respect for the rule of law.

89. We agreed that all relevant parties must work urgently for a just, lasting and comprehensive peace in the Middle East. We support a two-state solution with an independent, democratic, contiguous, and viable Palestinian state living side-by-side in peace and security with Israel and its other neighbours. We call for the necessary steps to build trust and urge the parties to work towards the resumption of direct negotiations without preconditions, taking note of the 23 September 2011 statement of the Middle East Quartet. We affirm our support for the Palestinian Authority and its state-building efforts and encourage the international community to extend the fullest assistance possible to revitalising the Palestinian economy.

90. We recognise the progress made by the Afghan National Security Forces in taking the lead for security across Afghanistan from mid-2013. We will continue to assist the Government of Afghanistan with meeting their commitments to strengthen their institutions of governance, to combat corruption and the threat of terrorism. We underline the continuing need for the Afghan Government, with support from the international community to tackle more effectively illicit drug production, trade and trafficking. This should include further measures to reduce the cultivation of opium poppy and the production of, trafficking in and consumption of opiates. Presidential and Provincial elections in 2014 should be credible, inclusive and transparent, as agreed under the Tokyo Mutual Accountability Framework. All Afghans should be able to participate peacefully in the country’s political future. We support an inclusive Afghan-led and Afghan-owned process of reconciliation, based on the principles of renouncing violence, cutting ties with terrorist groups and respecting the Afghan Constitution, including its human rights provisions, notably on the rights of women and minorities. Our commitment to Afghanistan, within a stable region, will endure beyond this important year of transition.

91. Preventing the proliferation of weapons of mass destruction and their means of delivery is a top priority. Such proliferation is a major threat to international peace and security.

92. Iran’s nuclear programme, which it continues to develop in violation of UN Security Council Resolutions and in defiance of the International Atomic Energy Agency (IAEA) Board of Governors resolutions, remains a source of serious concern. We once again urge Iran to comply fully and without delay with these international obligations. We call on the international community to ensure full implementation of UN sanctions. We stress that it is essential and urgent for Iran to cooperate fully with the IAEA on all aspects of its nuclear programme, including to resolve questions on its possible military dimensions, and to engage actively and constructively with the E3+3 (China, France, Germany, Russia, the UK, the US and the EU High Representative) to find the diplomatic resolution to the nuclear issue which we seek. We reaffirm that in line with the UN Security Council’s approved dual track approach, Iran has the ability to avoid further isolation and improve its situation only if it promptly addresses the concerns of the international community. We strongly urge Iran to fully respect its human rights obligations. We note the election of President-elect Rouhani and we invite Iran to use this opportunity to resolve its differences with the international community.

93. We remain deeply concerned about North Korea’s nuclear and ballistic missile programmes. North Korea must meet its international obligations by completely, verifiably and irreversibly abandoning its nuclear and ballistic missile programmes. It must engage constructively in credible and authentic multilateral talks and refrain from provocative actions. It must abide by its obligations under relevant UN Security Council Resolutions and the 19 September 2005 Joint Statement of the Six Party Talks. Whilst it refuses to meet these obligations, we call on the international community to ensure full implementation of UN sanctions against North Korea. We urge North Korea to address the concerns of the international community over its human rights violations, including the abductions issue and treatment of refugees returned to North Korea.

94. We welcomed the historic Declaration on Preventing Sexual Violence in Conflict adopted by G8 Foreign Ministers on 11 April and encouraged its early implementation. The Declaration contains political and practical elements, including acknowledgement by G8 members that rape and serious sexual violence in international armed conflict constitute grave breaches of the Geneva Conventions.

Nuclear Safety

95. Two years after the accident at the TEPCO's Fukushima Daiichi nuclear power station, achieving and maintaining the highest levels of nuclear safety worlwide remains a priority. We reaffirm the importance of international cooperation and our full support to the IAEA Action Plan on Nuclear Safety. We will continue, in our national capacity as well as collectively, to take our full share in its implementation. In this regard, we commend and support the work being done at the IAEA for improving the effectiveness of the Convention on Nuclear Safety and stress the need to further strenghen the implementation of other relevant conventions as well as national capabilities and international mechanisms for nuclear emergency preparedness and response.

Conclusion

96. We look forward to meeting under the Presidency of Russia in Sochi on 4-5 June 2014.

Annex 1

G8 Action Plan Principles to prevent the misuse of companies and legal arrangements

Subject to our different constitutional circumstances, and understanding that a one-size-fits all approach may not be the most effective, the G8 endorses the following core principles that are fundamental to the transparency of ownership and control of companies and legal arrangements. These core principles, consistent with the FATF standards, are essential to ensure the integrity of beneficial ownership and basic company information, the timely access to such information by law enforcement for investigative purposes, as well as, where appropriate, the legitimate commercial interests of the private sector. The G8 also commits to publish national Action Plans based on these principles that set out the concrete action each of us will take to counter money laundering and tax evasion. To ensure G8 members are held to account for their commitments, the G8 agrees to a process of self reporting through a public update on the progress made against individual action plans and to inform the Financial Action Task Force.

1. Companies should know who owns and controls them and their beneficial ownership and basic information should be adequate, accurate, and current. As such, companies should be required to obtain and hold their beneficial ownership and basic information, and ensure documentation of this information is accurate.

2. Beneficial ownership information on companies should be accessible onshore to law enforcement, tax administrations and other relevant authorities including, as appropriate, financial intelligence units. This could be achieved through central registries of company beneficial ownership and basic information at national or state level. Countries should consider measures to facilitate access to company beneficial ownership information by financial institutions and other regulated businesses. Some basic company information should be publicly accessible.

3. Trustees of express trusts should know the beneficial ownership of the trust, including information on beneficiaries and settlors. This information should be accessible by law enforcement, tax administrations and other relevant authorities including, as appropriate, financial intelligence units.

4. Authorities should understand the risks to which their anti-money laundering and countering the financing of terrorism regime is exposed and implement effective and proportionate measures to target those risks. Appropriate information on the results of the risk assessments should be shared with relevant authorities, regulated businesses and other jurisdictions.

5. The misuse of financial instruments and of certain shareholding structures which may obstruct transparency, such as bearer shares and nominee shareholders and directors, should be prevented.

6. Financial institutions and designated non financial businesses and professions, including trust and company service providers, should be subject to effective antimoney laundering and counter terrorist financing obligations to identify and verify the beneficial ownership of their customers. Countries should ensure effective supervision of these obligations.

7. Effective, proportionate and dissuasive sanctions should be available for companies, financial institutions and other regulated businesses that do not comply with their respective obligations, including those regarding customer due diligence. These sanctions should be robustly enforced.

8. National authorities should cooperate effectively domestically and across borders to combat the abuse of companies and legal arrangements for illicit activity. Countries should ensure that their relevant authorities can rapidly, constructively, and effectively provide basic company and beneficial ownership information upon request from foreign counterparts.