 Distinguished participants, good morning. Good morning. What this must entail is my name. I work with the Antwerp Expedition for the Government and the Environment, and we're excited to see you, those who are physically here, and those who are online. On my own behalf, but on behalf of the Court, and on behalf of the Republic of Indonesia Integrity and Cisco, the Civil Society Coalition of Oil and Gas, I take this opportunity once again to welcome you, and thank you for providing time to join us in our discussion this morning. Some of you probably may have been wondering why is it financial flows in Uganda, and especially today, but this is a very big issue, not only in Uganda, but also at the continental level and the global level. It is of particular interest to Uganda, because as you well know, last year we launched a strategy that looks at domestic resource mobilization. How can you increase the revenues that are generated entirely to be able to finance development and development projects? That has been a struggle for most African countries. Yet we realize that that is a lot of illegal money, or money that is leaving the continent, leaving Uganda in a legitimate way that won't actually benefit and get a hundred in Uganda finance development projects. So, Roku financial recovery, which is a U.S. based victim, is such an advocacy, and particularly, a court and Cisco are partnering and working together to increase research, to date and advocacy on easy financial flows. And having done some studies, we've also made some proposals. We thought that this morning we should have a discussion with a few of you. Some of you have been able to make physical aid, but also others online, so that we start this debate. And that's why I'm excited that you've been able to make it. I don't know whether James will allow, but probably we may not go into the introduction that you can see, we are running it, and people are still waiting online, so we may not do that, but sometimes when we go into the discussion as a primary, you'll be able to introduce yourself as you make your competition for observation. So the way we structure it is that we're going to have a panel that is going to share with us the insights about the subject, and then we'll have a primary where we can make our own competition. And as you can see from the program, this morning we have one of our colleagues from the National Committee, Mrs. Kishmen Kumar, who is the policy director, and she's going to be sharing with us our insights. Therefore, she's one of our panelists this morning. We have Dr. Dan Garamon, who is, I like to call him a professor of law. That's where he's probably... because the professor is a tough thing, but in other many places, Dan Garamon will be a professor now, but you know how caring it is to be a professor. You have to go through fire. But also allow me to introduce Mr. Maiko Oroku to K. I hope out of nowhere, who is the deputy executive director at the National Intelligence Authority, and I must say we are privileged to be here this morning to share with us the experience and what is happening from either side. And we have our own James Mendo, who is the national coordinator of the Civil Society Coalition on Law and Justice. He's going to do the moderation. Once again, thank you very much for making it. Let me hand over to James, invite the panelists to take their seats here, and then we proceed with our discussion. Thank you. Thank you very much, Onesmas, for that round of introduction. I'm going to request Mr. Maiko Olopo to come and join us here at the front. And with us online is Lakshmi from Global Financial Integrity. Lakshmi, please, you can turn on your camera for the participants. Yes, thank you. So thank you very much. The members present here as introduced. My name is James Mendo. I'm the national coordinator of the Civil Society Coalition on Oil and Gas. And I'm really privileged to be moderating this session. Many of you who are here present, it's because of the different work and the different capacities in which you're working that have a bearing on illicit financial flows. We all understand that with the COVID pandemic that hit the globe last year, countries are grappling with the challenge of raising revenues. And because of that challenge, countries have, it's upon the policymakers and those in governance to see to it that any expenses or any money that was being lost to any cause is brought back to the pool if we have to survive during the pandemic era. So illicit financial flows are one of the ways through which countries lose revenue. And we have quite able panellists who are going to take us through what exactly are illicit financial flows, how are they manifesting in our country and which sectors are red sports and what is the government doing to plug some of the loopholes that are being highlighted by the members. We are going to start with Lakshmi to share with us what exactly are illicit financial flows, how do they manifest and what are the correlations between illicit financial flows and socioeconomic perspectives of life. So for the next 10 or so minutes, we are going to allow Lakshmi to share with us from their perspective as global financial integrity and organization that has been monitoring illicit financial flows for years. What do you make of illicit financial flows? You can introduce yourself and then go ahead, Lakshmi. Thank you so much, James. Good morning to everyone over there in Kampala. You're muted. I'm not muted. Can you hear me? Please just hold on. I think I'll have, okay, go ahead. Can you hear me now, James? Yes, we can. Good morning, everyone. You know, if not for COVID, I would have been in Kampala and I'd much rather be with all of you in Uganda than sitting here in Washington, D.C. doing this. My name is Lakshmi Kumar. I am the Policy Director at Global Financial Integrity. We're a think tank based in Washington, D.C. and we work at the intersection of illicit financial flows, trade and the impact that they have on countries' economies. We were incredibly excited to partner with Accord for the last year and the last well over a year that we've been working on this to put together essentially the material that all of you see before you on your tables and on your desks, on your tables in front of you. Now the question might be simply asked, what is the value? Why did we do something like this? What is the need for us to talk about illicit financial flows? What is the value at that this document provides to stakeholders? And I want to emphasize that what we are trying to put together really is something that is useful, whether you're a civil society, whether you're in the private sector, if you're a financial institution like a bank trying to formulate policy, whether you're the government or whether you're a journalist trying to understand these issues. The one thing on this face of it doesn't seem obvious is that we have talked about issues of human rights, environmental justice, corruption, money laundering, gender equality, natural resource governance, extractives, buy and lodge, terrorism. What is it that connects all of this? What connects all of these themes, whether you're talking about sort of fighting child trafficking or human rights or forced labor or sort of essentially money laundering is that there is a financial theme that runs through all of it. Even if you're involved in an enterprise that is trafficking women, as you often see that a lot of women in Uganda trafficked for labor in the Gulf regions, what is it that connects all of this is that someone is making money through all of this. And what connects all these disparate very different themes is that someone is making money. So the way to address and one of the solutions to solve the problem is to essentially go after the money that people are making. If you can find the way to cut off their assets, cut off the ways in which they are able to move this money from all these illegal activities, you can essentially find a solution. You see, we spent the last 10 years trying to get beneficial ownership passed in the US. It took us 10 years. And in the 10 years, we only got it passed 2020 December. That is how long it took us. But what we were able to do and what we were able to show the government, we were able to show other civil society journalists is that no matter which facet of life you take, there is always, no matter which illegal activity you take, there is the one connecting theme is that someone is trying to make money from it. And so if you identify, you are able to tap the structures, the methods, the channels through which this money is being made, you have a solution that can provide at least a government a much more easier way to tackle a lot of these problems. And I think that underscores the point that a lot of you have already seen. I think through sort of the work that the EITI is already doing in Uganda is the value and benefit of beneficial ownership. Beneficial ownership is essentially, in its simplest terms, the ability to identify one individual. That is you have to identify a human being that is actually behind all these transactions. And what I think we are trying to do here is to provide both the government, journalists, civil society, a set of context-based examples, which is we wanted all the examples according to GFI wanted. If you're saying that, why is it that beneficial ownership will help with something like human rights abuse? We wanted to be able to give you a series of examples where for example, where women are being trafficked across into the Gulf of forced labour, human trafficking sometimes accounts for over 550 trillion Ugandan shillings annually globally. And so knowing that the women and children and young girls that are being trafficked out of Uganda, very often these are companies that are owned by people who don't always give their names. But knowing that that person behind it is a way to address essentially what is a human rights abuse that is occurring. Now, very similarly, when Uganda prosecuted its first money laundering case in 2017, what they found is the individuals who stole, and you'll see that right at the beginning of that fact sheet, is that the people that stole the money from the commercial bank invested it in homes, other assets. And so again, what ties it is the ability to identify an individual. Now, when we talk about gender equality, I don't think it's a surprise to say that in terms of the way, for example, adverse health conditions affect people, women, it tends to disproportionately affect women. And you see that in cases of HIV and other diseases where women tend to be disproportionately affected and also women tend to disproportionately also require state benefits, whether it's through maternal health care or other services that are being provided. Women often are more on the recipient end of government services. Therefore, when you see money being lost from it, the people that are the section of society that is first targeted or feels its ill effects often are women and children. Now, how does this tie into something as complex as financial transparency and beneficial ownership? Simply put, I think a lot of you are already in this room because of the way you work are familiar with the Global Health Fund. It's a fund that was put to help with some of the fight against tuberculosis, malaria, HIV. Since going back since 2005, the fund, the money that has gone to the Ministry of Health has been repeatedly hit by corruption scandals. And some of them have already been prosecuted. But what is interesting is in a lot of that, the patents, the way criminals who are doing human rights abuse, corruption abuse, money laundering, the way they're abusing the extractive sector, all of them use the same methodology, all of them take the money. They try to hide it within companies that you don't know who's the owner of it. They try to hide it in other assets like luxury vehicles or homes. So with the government having the knowledge of who is actually behind these companies makes it easier. For example, when we talked about the money over 65.8 billion Ugandan shillings moving out, which was essentially year mark for the Ministry of Health moving out. Investigations found in Uganda, through the Ugandan Department of Justice investigations found that this money was moved through 400 different private entities, all which existed on paper. They did not have actually real people behind it. They did not have real individuals. And this is not just something that we talk about in domestic implications. This is, as Onesma said at the beginning, when we talk about the ability of Uganda to sort of collect domestic resource mobilization, it's also the question of making sure that foreign entities that are investing, doing business, or for entities that are moving capital out of Uganda also have a responsibility on this way to attract them. One of the examples you'll see in our fact sheet that we've put together is about a Chinese firm in Uganda that had a contract to build ships, but essentially they were illegally taking on sand mining and moving sand out of Uganda. And that is essentially an investment opportunity where the benefits of it should have gone to Uganda, but they are unable to do it because what is the foreign company is conducting an illegal activity and moving profits. And the way around it is for the ability of justice to carry forward is to know who is the individual. It's not enough to have the local lawyer. It's not enough to have the employee's name for real meaningful action and for the real ability to make sure resources are kept within Uganda for the benefit of Ugandans is the need to pass legislation. And one of the things we suggest amongst all, a lot of other things is one, is the civil society, because sometimes we see that human rights groups, environmental justice groups, they all work separately. What is important to understand is that there are common tools that can apply irrespective of the area you work. Financial transparency tools can buttress and strengthen the advocacy work that you're doing. And for organizations that come from sort of a variety of fields to come together around it is a real ability to make things move forward. And that is the same thing which we see with government. I think when you go to the government, you want policy making to be evidenced based. I know we have an excellent speaker from the financial intelligence authority that I'm very grateful to share a stage with. For the FIA or for the Ugandan Central Bank, for the government to make policy, they want evidence based policies. So to be able to say that beneficial ownership of passing financial transparency laws affects not just the extractive sector, it affects gender equality, affects human rights, it affects environmental justice. I think what a court in GFI wanted to do is to be able to show you evidence based case examples that you can say this is why this law has such an impact in every facet that have Ugandan life because we have tried to take examples from almost every area that is topical, that affects people, that affects the organizations that work with you. I know we started late. So the last thing I want to do is to take up more time, but I would encourage everyone to strongly peruse this, ask us questions because beneficial ownership is the big ticket item. And I'm happy to talk about Ugandan's current law and how we can move forward. But what I think we want to really emphasize is that financial transparency is not just for purposes of financial law, money laundering. Financial transparency pools can be used in a multitude of areas to deal with a multitude of issues because there is always money behind every criminal activity. With that, I will not take up more time. I will let James sort of take charge again and help move the conversation along so that others can also provide you their excellent, excellent insights this morning. And give a round of applause for those insights. And thank you. And for sharing some of the things that Global Financial Interpret has found out over the years. And it's also good to note, as you mentioned in your presentation, that institutions like the Ministry of Justice, the Financial Intelligence Authority are already taking initiatives to unarth some of the monies that are being lost just like the revenues you said were lost in the Ministry of Under Health. And also she emphasized the fact that illicit financial flows, which are in essence moving of money of value from one country to another, doing it in a way that is illegitimate, affects every aspect of life. It extends to health, to extractives, agriculture, mining, and so on and so forth. So there are areas that are a bit more prone to illicit financial flows than others. And I think with us we are going to have the privilege of hearing from Dr. Dan Gabirano to share with us some of the findings or issues they have noted, especially in the extractive industry in respect to illicit financial flows. So, Mr. Dr. Dan, over to you. Thank you very much, Gems. My fellow panelists and everyone present in the room and online. So we'll play the video this morning, talk about this very critical and very important illicit financial flow. I want to thank you for painting by the whole picture of what illicit financial flows are from the global perspective, but also from the Asian perspective. Now, my decision is to really focus more about the petroleum sector and to, I don't know if Gems is able to project that, but essentially the study was done about illicit financial flows. So I'm going to give you an insight of why this could have been a period of research, a period of research. I want to start with the finding of the high level of panel on illicit financial flows. As you know, the economic commission of Africa appointed a high level panel of experts to study this illicit financial flows. So I want to thank you very much to all of our experts to study this IFF scenario. And one of the key things that they came up with, one of the key findings was that they caught countries that are reaching natural resources and countries with inadequate or nonexistent institutional architecture the most at risk of falling illicit financial flows. So this sort of drove the motivation for the research because as you know, the standard is catered to oil production maybe in the two years. And that really gives the background. So let's go to introduction. So essentially I think and this has really been pointed out that we know that Africa has been known as dependent on both aid and debt for a long time, but these are increasingly unsustainable. And in this case, the resource worth becomes a very important tool for filling the gap and boosting domestic revenue. Now it's expected that Uganda will earn about 50 billion lightest test dollars from its oil activities. And so far about a billion lightest test dollars has been realized. That's always a good test because we know that the first hope of commercial oil has not come out, but we've been following, we've been able to collect a number of taxes, cut-to-gauge taxes and a number of other revenues from the sector almost a billion shillings. Of course, the other sphere of repo effects of oil and gas production employment and so on and so forth. But whether Uganda derives by its oil prospects will definitely depend on, you know, the management of revenues and the sector as a whole. And that's why then these financial flows become an important aspect. In terms of, you know, again, generally I have about 15 minutes to run through just to sort of give some sort of general vision. But in terms of sector developments we have recently had quite comprehensive laws enacted from 2013 onwards. And what these laws do is that they provide for sector regulation. They put in place environmental safeguards, health and safety safeguards, rights of affected communities. They are not perfect. But the good beginning, we are starting from a better place than many other places in Africa. The laws also establish institutions. Many of them are now fully operating. The Victorian operator of Uganda, the national oil company, the electorate of Victoria. But importantly, we have also come up with one of our, in my opinion, quite a progressive public finance management law of 2015, which provides oversight financial controls in DC. Of course, their challenge is that, I mentioned on the white screen on the minister, I don't want to mention that. The major challenge however at this moment is how to safeguard these revenues from external leakings and ensuring that international companies pay fair share of their revenues under the law. Okay, now we dive into use of financial funds. There have been a number of definitions given. I want to pick one which I find quite comprehensive from global financial integrity and that is the movement of money and value from one country to another that are illicitly and illicitly transpired and or illicitly utilised. So the aspect of movement from one country to another is important. And the aspect that this money is illicitly and transpired or utilised. What's the effect of IRFs? So according to the 2010 study, it found that Africa was an estimated US$1 trillion to IRFs. The high-level panel that I earlier alluded to found that Africa was about US$50 billion per year. And very recently, I think, March 2020, the Brookings Institute conducted a study which found that between 1980 and 2018, Africa lost about US$1.3 trillion. This is almost the same amount of government assistance that Africa has received during this period. So it seems to be a balance in that respect that if Africa was gone, again, as did IRFs perhaps, we would not need this kind of government assistance. Another report by the UN Conference on Trade and Development, which again came out at the last year, again puts the instance of IRFs, particularly extractives, at US$40 billion per year and $278 billion per year of ten years. Now, I won't deliver the point. I think action has really done a good job to show the nexus between IRFs and the government and human rights essentially. They deny countries critical revenue to provide public goods and services and meet their goals under the sustainable government goals and human rights obligations. But they also challenge the legitimate tax system because it means that the multinationals pay their fair share while small micro, sorry, SMEs bear the greatest plant of tax. Now, as I already pointed out, source-rich countries like Uganda vulnerable to IRFs and the reason is that extractives generally are complex. They will elaborate global but it will change the difficult to understand especially in countries like Uganda without the magical capacity. But also ten years is vital to invest a lot of discretion in small groups and particularly the extractives in the Ugandan sector as well. But I think the most critical point is the dominance of multinational companies. Let's just also have a short picture about IRFs and the extent they affect Africa. If you look at the high-level panel report you find that Nigeria lost about 217.7 billion United States dollars. These are staggering amounts of money and more are Nigeria's than DC. Going back to the brookings study you find that all the ten countries the highest distance of IRFs, nine of them depend on extractive readers. So if you look at that list, I think it's already Ethiopia that does not quite depend on extractives. And that tells you that if Uganda does not take precaution it perhaps may face the same fate. Now, broadly, we look at the potential sources of drivers of IRFs in Uganda's petroleum sector. They are basically three commercial activities, corruption and crime. And I will go into this very briefly. When it comes to commercial drivers the challenges here are doing double taxation agreements and equal petroleum production sharing agreements and best erosion profit sharing strategies of companies. Again, DTSDT as they are agreements through which state parties voluntarily agree to restrict their business tax economic activities. Actually they are designed to prevent double taxation and attract FDI. But there's been growing debate on whether they actually achieve this and most of these have been banned because evidence shows that one DTSDT has actually promoted double taxation because the other way is to avoid double taxation than these agreements. But also in truth it's that they don't really provide such a huge incentive for FDI. You look at the 2010 study down in Uganda, you find that Australia is the second largest social FDI in Uganda. At the end there's no DTA between Uganda and Australia. At the same point you find that the Uganda Mauritius double taxation agreement but only United States dollars, $31.1 million has been realized. So Australia now marches Mauritius and then the conversation becomes whether this DTA Mauritius has facilitated FDI as was told. But again if you look at the Netherlands which is the largest social FDI to Uganda this by 2010 you find that companies from Australia sorry from Netherlands brought in about $3.7 million United States dollars. But of these only United States dollars $179 million came directly from Dutch companies. So the rest was from what we shall see as mailbox companies. In total Uganda has about 10 DTAs and currently negotiating an 11. But what they will note here is that all the three major players this way out in the oil sector are all Ugandan operations through Dutch subsidiaries. And why? Because the Netherlands for the most part examples dividend payments from the developing taxes but also you call this a slightly less about 10% during tax on interest. If you compare that with the Uganda UK double taxation agreement you find that both dividends and interest are subject to about 15% with holding tax. Same as the tax act of Uganda. Meaning that Ugandan companies pay about that. So the question is why should oil companies be exempted? And from just the Netherlands Uganda double taxation treaty a recent Oxford study has come to the conclusion that Uganda is likely to use about United States dollars 287 million in the world of taxes. Again that's an illustration of the Netherlands so you have James if you could move to the next slide please. Yes, so you have companies instead of repeating directly dividends and interest to the Netherlands in this case, which is a third country they prefer to go to China or France where these companies are on the side. They prefer to go to the Netherlands because then they are able to sell on how much they pay on dividends. If they were to go the direct route to have 15% with holding tax but if they come down go through the Netherlands they pay 0 to 5% and interest to be 10%. These are quite the number of sums that companies sell by doing that. We have a broad comparison sorry James I keep incognizing you. We have a general comparison about the next slide please. Thank you. So if you look at all those DTS that are active in Uganda you find that the Netherlands offers the most generous provisions whether for dividends, interest, royalties, technical services. The other issue is about the production sharing governments as you know most of the countries that Uganda cannot afford the technical requirements required to explore their resources. So they have to turn to other companies. And so these companies enjoy and much delivery in the negotiation of these production sharing governments. And as a result they tend to prefer the companies more than states and one key issue that usually comes out is the stabilization process and tax exemption. So they insist on this and what that means is that countries like Uganda maximize the revenue potential of their resources. Again commercial resources we look at BEPS essentially making profits appear in Uganda and appear in places like tax havens where the tax rates are zero or very negative. And this happens in a number of ways one is through price manipulation where essentially happens because most of these companies are related. So it's the brother and the sister in the sense trading so they wouldn't trade at the market price they would trade at the price that enables them enables one of the companies to earn more the one registered in the tax haven while the one registered in Uganda shows that it has not earned that much. So the tax then becomes very negative. But they can also in bread costs and we have had these issues come out by 2016 what the General's report has found that companies have claimed outside 4 billion United States dollars in eligible costs in Mozambique to be worse because companies there are prone to have exhalated costs by millions and millions of United States dollars. So maybe also quickly to speak about price shifting you may want to know that some of the oil companies also involved in the oil pipeline. Now that's a project that is subject to tax for 10 years and so what technically may happen they may you know, inflate the cost of transportation along the pipeline just to shift the greater part of the profits there and definitely they would enjoy tax for it and exemption and the study has recently been done to find that an impression by just one United States dollars would be to a revenue loss of about again close to about another dollar. That's quite a lot of money. Beps in practice essentially what I've been talking about instead of a company going by elected to the final cost you might, what's great tax happened, charges a less amount of 40 dollars you know the tax happened remember there's zero tax on negative tax so in the country the shared company in the tax happened would sell to another different country in this case at 100 dollars meaning that is a profit of 60 dollars but remember this is not a profit tax at 5 percent and then the final goes to buy the product at 110 US dollars if you want to know what you got is losing if it was to sell directly you would impose 15 percent on the United States dollars 110 or even 30 percent for that part of the corporate tax and all that is lost through these issues. Lastly the issue of crime that IFFs can also be perpetrated through criminal crime. This is the most common tax invasion but also issues of illegal exploitation of resources where companies go beyond the limits that they are supposed to go. This happened especially in Miami but it also happened in oil and gas. There's also theft there's this reporting of 20 and 20s of petroleum that went on between 2001 and 2008 on about 300,000 barrels of oil were lost in a single day. But just again at a declaration by just one percent in the case of Uganda this is just one production block EA1 study has found that that could easily result into a loss to about United States dollars 112. Another aspect of crime is illegal exploitation where non-compliance with environmental standards. Companies are supposed to comply with certain environmental standards but sometimes they actually don't and that post that they sell several compliance then becomes a social bias. This is the last corruption of course we all know that corruption is a huge issue here abuse of entrusted power for private and resource rich countries suffer more because there's a tendency again to best a lot of discretion in the community and of course political interference in the sector. Now it becomes the source of IFF square rights are paid on offshore accounts of officials and we have had this aggregation since 2011 even the pro parliament of course the ministers were clear to see again very recently one of the other ministers was implicated and so it happens in the local area friends are paid on offshore accounts but also where companies pay rights to save on tax and other revenue paid so this happens in the negotiation of the production sharing everything where they pay officials just for the purpose of saving. Global financial integrity that you're going to lose about one billion United States dollars of course we have a lot but the issue has been great with the parents and the lack of willies and the slavery issue like I mentioned I think late 2019 you had the U.S. Southern District Court of New York or if we get one of cabinet ministers here who have been received a private 500,000 United States dollars from one of the Chinese companies and that makes it a real worry. That's the summary I believe to be in the facts sheet I've now come to the recommendations if gems allows me I run through them but again I'm aware that these are well summarized in the information sheet so what you got needs at this point flowing from the above is that they need to expedite on going double taxation agreements particularly the one with the Netherlands needs to be revised. Argentine negotiation of existing PSAs, production sharing agreements are between two departments like governments there's nothing that stops the government of Uganda from renegotiating these PSAs in light of Chinese circumstances enhance the capacity and ability of UIN, Inspector General Government or IG Bank of Uganda OAG, FIA because these are all critical prayers certain need for renewed and crush on efforts enactment of a dedicated law for EITI operationalization there's only for immediate publication of past existing and future PSAs in light of all of the documents written and signatures as question mechanisms need to set no prices for oil enact beneficial ownership rules established and the lying ownership of companies but important to embrace principles of responsible business and respect environmental and social standards. Thank you very much James I know who was short but this was quite a big study and I have been struggling to sort of narrow it down Thank you very much. Thank you very much Doctor for reducing almost 70 pages in to 15 minutes and on our desks we all have copies of two information ships one titled elicit financial flows in Uganda by Accord and Global Financial Integrity and the other entitled elicit financial flow risk factors in Uganda's oil and gas sector by Cisco and Oxfarm you can get some of the insights from presentations made by Lakshmi and Dr. Dan before I call the next panelist I would like to recognize the members present physically and online we have about over 30 participants online thank you very much for joining and here physically we also have about 30 or 25 including representatives from government agencies who will also be sharing some of their perspectives in the plenary these include Petroleum Authority of Uganda Financial Intelligence Authority Uganda Registration Services Bureau the EITI secretariat and the Ministry of Energy among others we also have representatives from civil society and the fourth estates the media so this is a very rich conversation and we believe beyond this the conversation is going to be spreading and we continue this debate so the next panelist is from the government end having had from Global Financial Integrity and Dr. Dan Gabirano allowed me to invite Mr. Michael Olupot the Deputy Executive Director for Financial Intelligence Authority to share with us what in respect to the risks that are posed by elicit financial flaws and some of the reports and findings that have been coming over time what are those what are some of the measures government has put in place what are the initiatives the Financial Intelligence Authority is working on and for agencies like FIA that don't go to the media all the time sometimes we are not here what they are doing but there is a lot of amazing work they are doing behind the scenes to make sure they don't lose revenue so he will also share with us briefly the role that Financial Intelligence Authority plays over to you Mr. Michael Thank you Thank you moderator please present and those attending virtually my role has been simplified really because what Lakshmi covered and what done has gone through as born bear really what what the driver is I would therefore only concentrate on what the Financial Intelligence Authority is doing and complimenting our agencies as you are aware the authority is still young was established in 2013 by the under section 18 of the Antriman London Act of 2013 and the role of the Financial Intelligence Authority in combating illegal financial flows is legally embodied under the objective for which the authority was established which is educated under section 19 of that Act briefly they include enhancing the identification of process of crime and combating money laundering enhancing public awareness and understanding of matters related to money laundering ensuring compliance with the Act making information collected by it to promote competent authorities and to facilitate the demonstration and enforcement of the laws of Uganda and exchanging spontaneously or upon requesting information with similar bodies of other countries that may be relevant for the processing of analyzing of information relating to money laundering or financing so within existing frameworks the FIA undertakes its role in the fight against illicit financial flows through interventions that involve basically effective cross-border cooperation here we are a financial action task force style regional body so we are a member of SM Lab the Eastern Southern African Antriman laundering group 18 member countries in Eastern Southern Africa we are also recently last year joined the Hegmont a group of financial intelligence units that is now composed of 166 financial intelligence authorities around the world which exchange critical financial information relating to the movement of criminal funds and information for purposes of combating crime there is also intervention with respect to effective domestic intelligence cooperation we have signed MOUs with the URAH the State of Government with the CID Directorate of Public Prosecution and our Life Authority and the Registration Services Board Directorate of Citizenship in means of internal affairs all those are intended we do not refer by law but they are intended to strengthen confidence in exchanging information and deepen inside this cooperation regarding the intervention the intervention is enforcement over reporting by reporting entities they have it requires accountable persons or reporting entities to find certain reports these include suspicious transaction reports cross border large cash transaction cross border movement of currencies and negotiable and large cash large cash transaction reports now through these we are able to analyse and identify illicit movements of finances and other crimes that have been reported to us by reporting entities and of course the entities we also enforce those entities that is reporting entities according to the law to detect illegal activities a majority of these activities as you are aware thrive due to lack of transparency financial secrecy including shell companies and tax servants they also thrive due to inadequate reporting on payments and financial transactions and also due to lack of clarity and information on beneficial ownership done as the and looks have gone deeper into what beneficial ownership and inadequate and quite weak sanctions now the key preventive measures that the authority monitors for compliance by accountable persons especially regulated financial institutions include the implementation of customer due diligence including enhanced due diligence for politically exposed persons record keeping requirements by these institutions reporting suspicious transaction of course as I've read alluded undertaking risk assessments within the institutions of their vulnerabilities development of internal policies procedures and controls including ensuring effective audit function to test the systems and last but not least ensuring ongoing employee training including management and the boards now we we monitor compliance of the accountable persons on these issues but what is also important is that as a country we spearheaded under two in 2017 a national risk assessment and the report is available in our website now that national risk assessment revealed exactly what Dan and Lakshmi already alluded to the the key major crime generating crimes in Uganda include tax crimes that is tax evasion and avoidance they also include corruption and also include a fraud and that is goes under general crimes so in terms of amounts of illicit financial inflows generated those are the key areas that fall exactly as observed by the study now through the above measures that we enforce FIA is continuing to be part of the solution therefore to strengthen regional and international cooperation to enhance transparency especially in the operations of financial institutions to reform legislations to eliminate financial secrecy and provide full disclosure of beneficial ownership beneficial ownership of companies I'm sure from Uganda registration services Bureau will talk more what they are exactly doing to train and build financial investigative and prosecutorial capacities which are in dire shorting and to address weaknesses in institutional and legal frameworks including enforcement of punitive sanctions and the recovery of illegally updated assets now as you may be aware one of the issues for some of the colleagues who are familiar Uganda is currently being put under enhanced monitoring by the financial action task force because when we undertook the mutual evaluation of our systems it was found in 2016 and one of the weaknesses for which now we are put under the grilles is that is relating to the beneficial ownership so we are addressing that and as I said colleague from the legislation success bureau will touch on the details on what they are doing but the requirement is as I mentioned earlier addressing beneficial ownership ultimately enhancing transparency in the operations of the institutions now some of the key challenges in fighting illicit financial flows in general which I will end by this one include in our view lack of a coherent policy coordinating institution in the government in the fight against illicit financial flows I don't know whether any institution that is taking need in this but we have found ourselves in FIA at dilemma because we assumed it to be the ones illicit financial flows much more beyond because the drivers go beyond our mandate and therefore giving us this is the lack of a champion we are trying to engage with the ministry of finance and we hope that they will take it handle it only through one aspect domestic resource mobilization but it is wider than that in a conference that was held last week by UNOBC together with UNCTAD they are now establishing a framework to be able to measure illicit financial flows and countries will be required to report them regularly the amount of illicit financial flows in accordance with the requirements of the SDG 16.1 which requires countries to reduce illicit financial flows in order to freeze funds for development so within that framework we hope that the government will institute a central body that should be monitoring illicit financial flows but having said that the need to have a coordinating institution that coordinates both activities that generate the drivers like commercial activities corruption, crime and the rest is very important there is also lack of a framework of coordinating mutual legal assistance mutual legal assistance that has already been highlighted in the study a weak domestic cooperation framework especially among law enforcement agencies we have a shortage of financial investigative and policy tutorial skills there is also an issue of inadequate resources available for law enforcement agencies and as the previous presenter indicated existence of unfair trade unfair double taxation agreements with very serious loopholes especially with our biggest trading partners we have double taxation agreements with India, Africa 10 of them Netherlands, Italy which have already been mentioned and we feel that there is compelling need to have this reviewed in order to identify unfair clauses and remove them in order to curb illicit financial flows there is also the challenge which we have noted as the one of aggressive pursuit to attract foreign direct investment on the part of government in this way they provide very generous tax exemptions and I think this is one area that the conversation also needs to touch on in terms of policy and how do we attract foreign direct investment without providing more generous exemptions that contribute to a large outflow of these resources and then finally we noted that finally but not least the lack of a comprehensive asset recovery legislation I think this is an area which is work in progress and I don't have details but it is being spearheaded by the directorate of ethics and integrity maybe from the government which is also working hand in hand they could give on how far they are going on ladies and gentlemen these are the key challenges that we have noted and I wish to thank you for listening to me thank you thank you very much Mr report for sharing some of the insights and you highlighted what the financial intelligence authority is doing and also highlighted what the general public is expecting or other entities of the financial intelligence authority which as an authority you believe is over and above your mandate and I think that's a conversation we need to have as you pointed out in the conclusion and some of the recommendations or things that you've noted such as the lack of a coherent policy on this issue and also the absence of a central coordinating entity or agency for government work on this issue these are all very pertinent conversations which I believe from this space the 60 or 65 of us physically and virtually in this meeting can start pondering upon and coming up with some of the ideas on how these things can be addressed and I think Mr Allport proposed that maybe the Ministry of Finance could take on the coordination role and so on but his remarks come at a time when we are opening up to the plenary for the rest of the members both online and physically here to share their thoughts on the issue but as we open up I would like if it's fine with the members here to first give an opportunity there's an extra microphone if we could yes we have representation from Uganda Registration Services Bureau and Miss Patricia we would like to know if in your mind would you share a little more about what URSB is doing especially on the issue of beneficial ownership because it came through in Lakshmi's presentation Dr. Gabirano's presentation and also Mr. Allport emphasized it what is the Uganda Registration Services Bureau as the go to place that we would start this action what is URSB doing around beneficial ownership and and IFF is at the back which is yeah and I think we have also representative of the head of the EITI secretariat which I believe has conversations on beneficial ownership and beneficial ownership register so she can also share her thoughts after that thank you Patricia thank you my name is Patricia for URSB at URSB the Registration Bureau is one of the county of Pasem they can share you of the anti-money so we have companies on URSB and below URSB below Pasem so we are currently amending the company in amending the company we are required to have a definition section on what beneficial ownership is a provision requiring all companies to provide beneficial ownership and then we shall have regulations where we list the kinds of transactions that will be and give us that extra information in the lettering as the legal process goes on because it's not a short time thing we have internal guidelines that we implemented as a specific order and among the things we look at companies being open to the shareholders the members if there is a beneficial owner behind the cost of the care and then we have transactions we have those transactions, transfers, increases changes you will notice that you might have companies that will incorporate today after two weeks will change their name so we need to know why are you doing that and you have to discuss and then we have multiple registrations where we have one individual who has numerous operations we also require more than one company actually to provide the information and transactions over 100 million we are closely working with the NGO Bureau especially for the NGOs and then FIA and then part of the things we are also going to make in our law is to provide because it is illegal it is a way of hiding information so that is going to be unmeted in the law and you will have a transition period for the existing ones to invite them to share and then together with FIA we are supposed to provide us with a list of politically exposed people and then people who have sanctions against them we can't have them on our register because of the criminal sanctions against them and then all that by looking at the legal reform and all is going to be supported by a new system where we shall have all digital online because where this stuff is online it is easy to flag as opposed to a manual testing where you cannot use the trap and know that Patricia has registered by company then one month and then another thing we currently have information available however for this beneficial ownership our new system we shall have it somewhere so that all competent authorities can easily access it as long as they require thank you very much by maybe just one more for clarity you said competent authorities can access the register where the beneficial owners will be registered so it's not open to the public okay thank you and I think that's where Miss Gloria Mugambe comes in from in town because I understand that EITI is also heading the direction of beneficial ownership register maybe you could share a light on that in view of the conversation Good morning everyone my name is Gloria Mugambe I'm the head of the Uganda National EITI Secretariat you've only joined EITI last year on the 12th of August EITI is the Explanative Industries Transparency Initiative it is the global standard for the good governance of expanding sectors focus and mining we were the 54th country to join since then I think one of the countries has joined so joining EITI comes with a number of implications and requirements and one of them is beneficial ownership so under EITI all the companies in oil gas and mining will have to declare beneficial ownership will have to know who are the owners of these companies and beyond that as Patricia was explaining who are the real owners who benefits from the transactions that these companies undertake in Uganda and it's good to know that a lot of work has already been done so our opinion is I think all I have to do is pay Patricia is it? she will give me that information of course it's not as simple as that but there we have a beginning we have a precedent we have where we are going to start from as you know we have four five main companies in oil and gas it is the mining sector where we might be where we might have to do some a little more hard work in EITI to understand who are the owners of the companies transacting in mining and who the beneficial owners are I just want to also touch on the issue of contract transparency because under EITI became a requirement from 1st of January this year that all contracts that the country enters in this sector in the structure sector oil gas and mining so any new contracts that Uganda enters especially from the second and last same round that the country has undertaken or undergone will be made public if we do not make them public then who will be suspended from EITI so we are fully aware of the implications of joining and this is something that we must do also any amendment to our old contract after 1st of January this year means that the entire contract must be published so these are some of the things that we have signed up to and we hope that we will be able to meet the high standard to which we are going to set ourselves I just wanted since I have the microphone in a minute I wanted to see clarification from the gentleman from FIA I wanted to understand better the reason for greylisting the reason why we have been greylisted under FIA and he said because of beneficial ownership and I wanted to understand what it is that we have not done that put us on the greylist thank you thank you very much for starting on the questions before we open up to the questions we have Mr. Tom Ayibari from the Petroleum Authority of Uganda he's a manager of economic and financial analysis the report by Mr. Dr. Dan Gabirano highlighted with a lot of emphasis the oil and gas sector and how risky it is for Uganda now that we are going into production and the risks the risks he highlights still exist we have not yet addressed them as far as I know what is petroleum authority and are the MDAs in the oil and gas sector doing to see that some of the concerns highlighted in the report are addressed thank you James thank you to all the presenters on the panel good morning everyone I am Mr. Tom Ayibari I am the manager of the Economic and Financial Analysis of the Petroleum Authority of Uganda first of all we would like to appreciate the time taken to develop this research and this report we do see some value and a lot of value in the work that is done and I think to speak to your question I think we first of all we need to be careful because in our definition of the effects the first of all we talk about money that is illegitimately generated and transpired and back lost between countries however some of the things that we have cited in the research are not illegitimately for example we have the legal double taxation that we entered as sovereign states in other countries yes some might not have terms that are spread over the past but they are not in effect illegal so you might have difficulty having an international international understanding that that is an ideal but that not being said it is something that we flag and raised to the Ministry of Finance and that and a number of other domestic tax agreements as you have highlighted in the paper are currently being renegotiated there are other aspects on the PSS then being an eco once again we feel that is not a true reflection of the reality as many of you will know the IMF and even some of your partners in civil society for example I think global witness had a study in 2014 and I think it is a good deal a good deal better right and it highlights that Uganda as a country has some of the world class PSS around the world and there are aspects that should raise their own stabilisation yes some of the clauses are there they do not prevent us as a sovereign state from amending our laws to increase the tax rate all they do is to provide an opportunity for the investor to seek some sort of recourse because they had a legitimate economic expectation and we need to provide some of that back and forth discussion so yes the stabilisation clauses are there but they are not in effect to freeze they are what we call in the industry equilibrium stabilisation clauses I may not go so much into the detail but there are aspects around basic base erosion that you highlighted and we feel we have a very robust redeco and regulatory framework where we work with the office of auditor general as you highlighted to highlight some of those inflation costs if they are there and maybe bring them up to the attention of the various members of the country there are some things I might be able to speak things like corruption and crime I think those are evident in every country however I would just again advise us to be cautious because correlation for example if in Africa and the various countries that have mineral resources if there has been an occurrence of high effects and there is also an occurrence of entities that incorporated in safe efforts it doesn't necessarily mean that one will cause it here it simply means that they are correlated and they appear together and I think the last point I would like to make on the two things that you talked about I think one on beneficial ownership as an institution we play a very big role we regulate the sector and we are fully aware of the corporate structures of all the companies that do by taking the industry in Uganda this is information that is available and we have made to all levels of government we also have what we can do called a national supplier database where all local and foreign entities that have made goods to the sector are registered which is free and we have visibility of the corporate structures of all those entities so we know all the owners and this is information that we can help you aware as a one may be required the last aspect I will touch on is a contract transpiracy I think this is something that has been enshrined in our legal framework as we know from the national oil and gas policy of 2008 under objective 6 we turned from as way back as 2008 to the members of the EITR and even in the oil and gas agreement on management policy of 2015 this was a core aspect that was identified and has been shared by Ms. Gloria sorry can you read this Ms. Gloria I am not sure if it is Ms. Gloria Yes it is Ms. Gloria we are now members of EITI and we have made progress on any rules in that and I think it is just a testament to the commitments that we made in the various laws and policies and we are thinking for sure Thank you very much and indeed Uganda's joining EITI at the end of last year was proof of a sense of commitment towards ensuring transparency in the extractive industry that is oil, gas and mining and he has posed a question which I believe Dr. Dunn in your last three or five minutes you will have to shed more light on the issue of elicit the fact that we are talking about elicit transactions and some transactions highlighted are not legitimate transactions so are we discussing illegal transactions or there is a line between illegal elicit that is some English that Dr. will teach us without further ado I am going to open up for comments both here and online those online you can either put them in the chat or raise your hand we shall take about two or three hands and we shall take three or four from those physically present I see Jane Nalunga's hand is up then we shall follow with Lynn then Joseph and finally Henry yes let's keep it brief we are closing into our time okay thank you so much James and thanks to all the presenters and people who want to talk to you about these studies I have to comments one as the issue which has been raised by the previous speaker on the issue of elicit and elicit I am not a legal person but I think we need to address the Nalunga team when we are talking about IFPs because for us as civil society as you can and the whole issue are is the outflow of resources out of our country whether they are legal or legal we need to look at that so then we need to we think that Nalunga team and go back to the issue of cut-off life when we talk about IFPs and cut-off life because what we want is to retain those resources inside our country another issue too can you stand up if you don't mind that's okay another issue which has been raised by Mr. Rupot is the issue of investment what we are talking about on investment issues and I think we need also to consider looking at the legal frameworks around our investment on investment the Netherlands which expire and the negotiations are there is but we need to look at that investment frameworks thank you so much thank you and Lim is right next Dim and Sanitizer okay so just quickly to link it to from impact I just wanted to flood the issue of the mining sector and talk that the mining sector is under review and I think it should be appearing before Parliament I think that creates an opportunity for us to include provisions around GVC financial flows I think it would be important that everyone in the room and online keeps that in mind because 90% of our production in the country is realized by that is a small scale mining sector and this sector of course is very vulnerable to beneficial ownership issues so who is actually putting money into a small association to allow them to realize one kilogram of gold and then how does it lead the country and so on so thank you we can go to Joseph Louie online we are going to be coming to you if there are any other online participants that would like to share comments you can put your hands up we so far have one we'll be getting others yes thank you to the previous speakers Joseph Biomanji from the discussions it's very clear that corporate entities are at the centre of illicit financial flows and for us to be able to hold them accountable access to information is crucial I'm glad that Patricia from Uganda registration services indicates that they are having a review of the company's act and just like Lina Nogin also in the mining sector they are reviewing the laws we need to be very intentional to flag the issue of access to information of the beneficiary owners because without that it would be very hard for us to pursue them and hold them accountable because the moment that is lost to the beneficiary owners you can end up losing on quality public services thank you so much thank you Joseph yes Henry thanks James my name is Henry Berserle I work with the water government in 6th Street three questions one comment and first one is basically to our FIA and our colleagues in government you talked about what is the name you said that these spontaneous information exchange between Uganda and other countries on tax payers that are operating in different jurisdictions I observed that we are having problems with partners who exchange information from OECD countries and I think that applies to any other regions so I am wondering how colleagues in government are handling that because you may be very generous we are generous stories in FDI by giving out information on tax personalities and here it takes us for ages to get the same favor from the other colleagues of ours the next question is how does the FIA avoid political interference of influence for them to slap or to freeze or suspect somebody's money to be illegal or suspicious how do strategists talk about that that question is from asset recovery I think I saw something in the news where some of these assets were recovered under what legal framework by those assets recovered what frameworks are put in place to recover assets from high net worth politically connected people who have assets abroad and then my comment is keep it brief we have a quest for FDI as a country and we have become very smart and going out to register as international companies coming back as international companies and actually individuals the beneficiaries are residents of Uganda how do you deal with that and the benefit of the tax incentives and what strategies are put in place to safeguard that kind of problem thank you very much we are going to move to our online participants Louis Kizito you can unmute yourself and share your comment please I'm sure you can hear me yes we can I'm going to speak as some young person who is involved in financial innovation tech startups and that kind of thing briefly this is my comment I think my former lecturer who elucidated on the illicit financial flows but I am afraid that illicit financial flows are going to be used to stifle innovations in that area of work as people who innovate in the technology world you realise that much as there is a semblance of fraud in things like cryptocurrencies which I expected this gathering to talk about the financial intelligence authority sought leave of parliament to include virtual asset service providers as a part of the list of accountable persons which is true and it's good but I'm afraid that with the laws coming up like the recent amendment to the Antimony Ordering Act I think they should include people who are dealing with cryptocurrencies as accountable persons then we also have the national payment system law I'm afraid we should actually draw a fine line and I think balance between the need to regulate and prevent illicit financial flows and not to stifle innovation because you realise that after the financial crisis of 2008 and I'm going to be very brief I don't want to be very I don't want to go on forever but after the 2008 financial crisis we realise that the centralised finance became the thing now I don't want to veer so much into cryptocurrencies but we have what they call the blockchain technology which can enable financial transactions around the world without these financial intermediaries called banks now what I'm just calling for is that let us not veer so much into over-regulation because for me I'm general counsel of a tech startup and I know the problems we go to recently a safe border had problems that are sharing but the most important thing we should do with illicit financial flows now is that they have a holding company structure in Mauritius which they used as an investment vehicle in Uganda the reason why tech startups do that is that it is kept too intensive to take startup so you may not want to doge taxes but you may want to have an environment where your dividends are non-tax, where your employment what they call employee stock options because some of us cannot compensate employees with money so we have to advise in the stock options we cannot convince investors that we have a very good investment climate for them to put money in our tech startups so we end up like safe border has done as a safe border holding in Mauritius they take advantage of the Mauritius double taxation to not to avoid taxes not to minimize taxes but you know the things that startups do and the financial mode of venture capital all these things require a good environment which you do not have so as I conclude we should address two things in this discussion they need to regulate and avoid but then not to stifle innovation because that's where the future is let's provide a good environment for and I was happy that Ministry of Finance came up with what they call the blockchain free trade zone area the searcher instrument where you can develop a blockchain product with the free trade area but that is not enough we need to give these people young people who have a very big full population which can if not employed can be a very good time bomb for this country so thank you very much I would like to conclude I am kindly indulging you people in this gathering not to use illicit financial flows as a magic wand to stifle innovation because once we stifle this innovation we might lag behind Kenya actually is a fintech hub now in the emerging in this continent can we compete that is all I had to say thank you very much and I would like to thank my former lecturer Dan Gabriano for his contribution thank you Louis for sharing your insights and for talking your lecture we are also grateful to share yes he raises very patented issues we had thought we would have at least three people online and they have not those online have not put their hands up so I think they would be showing at the top yeah we are going to allow yes no I just want to let you know there are a couple of people have asked questions in the chat function okay yeah so those in the chat and then I can allow Ronald from the independent and Andrew from Resource Rights Africa and then we come back to the panelists and conclude Mojisha Imam says absence of fiscal rules on withdrawal from petroleum fund is not helping proper management of oil revenues and again according to the cannery's documentary that's I hope MBS documentary on corruption in Uganda we see and judge that Uganda for long hasn't been able to deal with corrupt individuals yet it's one of the one way for IFFs it is feared that we won't be able to tackle IFFs to the full capacity thank you then Evelyn Mwendo says will the beneficial ownership laws be limited to only companies what about trusts and other legal arrangements otherwise the steps towards enacting beneficial ownership laws are commendable yes I think there is quizera yes quizera my concern is about legislation implementation and enforcement towards illicit financial flows issue of mining sand locks and other mean rows how are issues of the royalties handled minimum wage in case of foreign direct investment in our country which are exempted from taxes and how much of the profits from the international oil companies I think should be repatriated yes those are the few we got online if there is any other we shall flag it but our time is first spent we are going to give Ronald a minute and then Andrew a minute so that we can go back to our panellists to share their parting shots and respond to some of the questions thank you James my question was to from here I don't know if there is a question maybe it's a question about in your presentation you mentioned what you are writing I think one of the challenges you are grappling with is that you don't have a central body to help you do your work better and then earlier that you sort of require another central body to help you do your work better but then for me you are getting confused I think fear though we understand it is an authority for playing for playing the loud I don't understand it you are the this body you are you want so if you want to government or Uganda structure above you you who is supposed to grow most of this work do you lack resources in terms of finance and human resource or you are just running away from what you are supposed to grow I am going to get to say that thanks thank you for the question I don't know whether to thank for the question I don't know what to say but the question is posed and I think Mr Henry also somehow scratched the elephant in the room about which is a question I think Mr Allport will answer the risk of being politically moved looking at the past incidents where in the media or in some circles especially civil society I am not speaking for government that the authority seems to be going after the small fish that civil society is so those are things that you can share some light on yes thank you my name is I am from Africa and my question is to Dr Talaga in that study you highlighted a lot of minds that lost that continent in Africa but also looking at Uganda in particular I am wondering whether we can identify the global nebulas of this elicit financial flows or in that particular study oh we still have a child in that and what are the mechanisms to to handle these global nebulas such that we can meet to get some of these illegal financial flows out of our economy which we need to deal with thank you thank you very much we are going to move back to our panelists and I think Lakshmi we shall use the same order I actually believe the question from Louis is something you can help us with as the rest of the panelists can also comment on the same thank you over to you Lakshmi your three minutes four marks yes the one thing James you should know I am scrupulous about making sure I stay within time so no worries there but no this has been fascinating I think the remarks that everyone spoken about I think has really enriched the conversation so I think I have learned just as much from being on the panel and hearing everyone with that said I just want to quickly touch upon the very relevant comment that Louis made about innovation and regulation where does the balance lie the one thing I will say is as you talk about cryptocurrency I think Uganda is a great example because Uganda not just Uganda but especially Uganda because one of the largest cryptocurrency money laundering Ponzi scams globally Uganda was the main victim of it it was a 4 billion US dollar scam called One Coin which affected everyone from the US to Europe to the Middle East and especially it affected a lot of Ugandans that very often was sort of you know did not necessarily have the socio-economic means but I think as much as we talk as much as there is the emphasis on innovation I think you know we also have to think about the environments in which regulation is operating if there are not as many if individuals are not as well aware of the risks of some of these financial products there is great opportunity for sort of fraud and abuse and I think Louis is right he says there is a balance but I think what we are often dealing with some of these newer technologies is that as very often technology develops quicker than regulation and you are often playing catch up is that we are essentially a lot of times operating an environment where there is the absence of regulation so as opposed to over regulation I would actually make the case but a lot of the problems we are seeing here is because we are still most regulation globally is playing and we are really operating in an absence I just wanted to again point on the beneficial ownership is that I think one of the things that we should consider is one is what you want to avoid is the multiplicity of beneficial ownership definitions because you know I think we have talked about the business registry there is already one beneficial ownership law sort of on the books you know in a lot of income tax sort of for agreements there is beneficial ownership law concept now if the mining bill were to come out with a new thing I think the thing that you want to avoid above all else is multiple definitions of beneficial ownership because that will just create we will create problems in enforcement and you have seen that happen in many other countries and the last thing is that you know I think when you are talking about access it is not just the access but I think we also want to talk about timeliness of access which is how quickly access what information is covered what entities are covered and it is not just entities that open a bank account it is not just entities that are invested in or have contracts in the oil and gas sector mining sector because very often companies if you look at the supply chain can just be used to hold a real estate asset can be used to hold some other kind of asset to which you can move so I think the beneficial ownership law should cover all entities that are created and registered in Uganda but especially when you are talking about foreign investment you want to have foreign entities that are registered to do business in Uganda so even if they are created outside Uganda you want to make sure that the foreign entity also provides beneficial ownership information that is held within Uganda and not with a foreign regulator because I think you know I think the Mr. Michael talked about the problems with sort of you know that's the best way to sort of avoid that and I will stop there I think I did not cross the point Thank you very much you responded to the question but maybe since we may not come back to you any parting shots what the action points anything's going forward beyond this conversation what is and I think also we'll be sharing on behalf of Accord and GFI what are some of the things going forward in respect to this debate on illicit financial flows? I think the one thing is I think as we talk about illicit and illegal I just want to leave the thought saying that that debate has not yet been is not settled because there are I think different perspectives whether it's an African perspective whether it's but I think the one thing to consider is that there is sort of an international standard and I think the definition that Accord uses in our information packet is the definition that the World Bank the UN, UNODC and everybody that works in this area does it I think in the future really is if you know there are governments don't have unlimited resources they have limited resources and I think it's to find the best policy options to push forward and I think in the multiplicity of issues that we've spoken today I think really figuring out beneficial ownership the implementation of that the access piece of that I think is critical to sort of touch on almost every area that we've covered then and I think you know that's where I think you know I'd like the thing that Accord and GF I want to push the bulk of my efforts into because I think the reality of that will transform the reality almost everything else that we're talking about today. Thank you very much Lakshmi we can now go to Dr. Dan Gavirano to respond to the questions that were posed and also share his parting shots in three or four minutes Max. Thank you very much James and thank you very much for the audience for the questions and insights. I cannot have many questions to respond to but there was quite an interesting debate that incriminating from the question from the gentleman from the Petroleum Authority of Uganda there are I think two issues one is to do with the production sharing of remains and the other is to do with the ETA I think cannot be denied that Uganda got a relatively good deal but I think there's nothing bad about striving for a human better deal I'm turning to the you know it's absurd that these controls are not being disclosed but transform and go to the staff why they disclose these on the other frameworks and I think there are quite two striking things that come from I think the health protocol one is that I think the PSA respect to EA1 that's between Uganda and Taro was the budget at the time when the city idea was being done across the border in the DRC Uganda got about 300,000 and United States dollars the DRC another comparison that was striking there was which are the times not to have a government but also turned out to have a better deal so I think we cannot bury our heads because we don't have a better deal and you know a number of other poor and negotiated clauses have come sometime in 2010 I think there was no this is on the because it was where I think the minister then had granted to the oil from payment that's an extremely poor negotiated clause and we would have lost because the assessment was about 150 million so there was a loss so I think there's nothing that stops us and I think this is my appeal that we can get a better deal when it comes to DTS there's a distinction between illegal and iris the definition I think in half half in short pushed us to the kind of movement of money and money from one country for another that are iris not illegal but iris now when I did just a quick search illegal means something that is contrary to the law for forbidden by law this has to be criminal iris it means something that's not may not be approved by law that is not invited I think again we cannot bury our heads I think there's a lot that is inappropriate for a Chinese oil company to come from China come and invest in Uganda and go through in this case the Netherlands just for purposes of optimizing its profits I think because in the first place the DTA between Uganda and the Netherlands was really going to be you know citizens or companies these two countries there's something quite inappropriate and I think Rome as before by Rome to a school of thought it was Rome you know at some point genocide was not illegal at some point the appetite was legal maybe we should move towards criminalizing some of these and take them to that state because this is a very important matter that I think cannot be you know under root yeah so I think that was so we can strike for better in short gentlemen yeah Mr. Ruhl unfortunately this research was limited to oil and gas and that's where about my competition stop but not very covalent with feedback I have heard that blockchain actually was a transparent transaction I don't know much about that that's an area to think through but it's beyond my confidence that my batting short is this I think there's nothing to put it very clear there's nothing inappropriate about companies making profit there's nothing inappropriate about that I think the issue is that they must meet and pay their fair share taxes everyone in this room is taxed 30% I believe on average why should the amount of national that makes all these unique profits go away without being taxed it's immoral it can never be justified and for me that's my batting short thank you very much thank you very much doctor it's immoral, it's unjust, it can't be justified and I think he puts it the simplest way we can understand and I think Jen had also highlighted the reference to these IFFs it's capital flight IFFs is a lot of English but what we are discussing here is capital flight there is money that would otherwise be coming in that is going out whether it's being done illegally or legally is another question but we are losing when we are trying to tax now withdraw money from the bank we've taxed OTT people have used IPN and all that is happening but there are bigger monies that would be getting that are just passing right in front of us so I think doctor has really put it well that how do we make sure that these corporations pay what is fair Louie referred to safe border being registered in Mauritius just for take reasons but people who know that PTA between Uganda and Mauritius know that safe border which is operating here could have registered here but it has interest in going to Mauritius so I'm going to pass the microphone to the last panelist to share and respond to a number of questions including one from Gloria and the few others from other members over to you and your parting shot as well thank you very much we should the audience for the comments starting with Gloria why was Uganda placed on the Korean list Uganda was placed on the Korean list on a number of issues but with respect to what you are discussing one of the issues was inadequate beneficial ownership specifically Uganda is requested to strengthen and implement a system of sanctions for violation of beneficial ownership transparous appropriations currently in Uganda there are no sanctions that we have for violations of beneficial ownership transparous appropriations then secondly Uganda is also required to demonstrate that competent authorities actually have time and access to accurate, basic and beneficial ownership information for legal entities held by the Amparo and OO by regulated entities again that demonstration was not provided to assessing entities and that is one of the issues and beneficial ownership that we are working to resolve among others it just commented about the need to look at investment framework in totality and then the issue of outflows that I believe Henry was asking about the issue of spontaneous information exchange now in the context of the financial intelligence authority and within our mandate when I was talking about spontaneous information exchange I was talking about information exchange with respect to exchange between FIA and other FIAs around the world that is the equivalent institutions around the world as I mentioned there are 166 other financial intelligence units around the world and well they have created a safe exchange network online through a safe information a safe information exchange system now it is a requirement under our membership that all these countries share information or exchange information spontaneously that is if there is information that will benefit say UK FIU and we notice that UK entity here as a serious or only request that is if they request for information so but the other thing that makes this useful probably that I did not mention is that because of our access to this global network of information competent authorities and entities in Uganda can also request for beneficial ownership information of other entities based in other countries they cannot directly acquire safe from foreign country you will write there is a counseling sphere FIA and through this information we can request the FIA of the UK to who can give us information that is FIA will give us that information it is an important network that avoids the procedures of deliveries of traumatic channels and so on which can take a long time now of course with respect to taxi issues so their own information then that's specific issues so which is different from the framework that I was talking about and how does FIA avoid political influence to freeze funds and under what legal framework are we recovering assets now the freezing of funds by FIA is provided under the law they are two issues that have been confused the FIA gets information on funds that are flowing through the financial system not cash that is outside the financial system and we get this information through the reporting entities these current companies as outlined under schedule 2 of the act so they report those information through suspicious transaction and who goes for the movement of currencies that I mentioned now when we analyze that information then we can get leads through suspicious information that is actually true and suspicious information that is not true and that doesn't have leads so if suspicious information relates and gives us a clue that this is a criminal then we forward that information to an appropriate agents if it is relating to corruption we forward it to a agent if it is relating to the tax then we forward it to to URA8 and in fact since we came into being especially in the last 3 hours the information that we forwarded to URA8 has resulted into the reassessment of taxes to a number of entities and the recovery of money which is now I think over 8 billion as a result of the information of course one of the example is that a number of people use their personal account they have companies but they use their personal account to do transaction when they turn it over is a statistic then some of those are some of the issues that URA8 takes up so we are not so the issue of freezing funds is provided under the law and we raise on the way it is necessary there is another element to the respect of EF the terrorist financing that of course was in the papers in the recent past now that law has a bit of a problem and we have brought it attention because if you can relocate your collector it was at the height when IGP by URA was IGP and the initial proposal was to have IGP to freeze the account then finally refuse that IGP cannot freeze those account instead they deleted IGP and inserted FIA and unfortunately they did not amend the other sections because after that it is supposed to be freezing because IGP freeze and then you forward it to DDP and then DDP goes to court so if they are changing as they did they should have changed after freezing we don't need now to forward to DDP we just need now to freeze the account because the law provides that we forward to DDP that is what we did and DDP is saying now we cannot proceed with this code unless we are saying it is from police so they have to go to the court and that causes a bit of confusion but I hope you will be sorted out now the legal framework for recovery and assets the legal framework exists in bits and pieces as you may address the legal framework in the and also IGP IGP is using so but what we are saying the framework is not comprehensive enough for purposes that are different for the recovery of assets I give you an example suppose and you have you have known this suppose if you have seen how they say what are you I disappeared in the police oh for example we are going to the asset is for example a hospital or a school now there is no law that provides on how that asset will be managed how it is to proceed the other and also it is mainly for women of this as a study we need to move to a node which is more effective as our neighbors in Kenya with respect to Luis BASPS PES the idea is not to stick for innovation and indeed it is not at all BASPS providers who are placed by parliament under with respect only to money laundering and terrorist financing so we are enforcing only that aspect again there is a law in the police framework for the regulation of FinTechs and of course the BASPS that policy issue has to be taken by an entity as well as the Ministry of Finance we are not the regulators of BASPS but under the law and under international standards of money laundering countries to ensure that the BASPS are registered and the report in accordance with the requirements of the international anti-money laundering standard that is why we put it under that but that is only a small aspect there needs to be an inclusive entity to regulate BASPS to provide policy direction and one of which we include maybe provisions for encouraging the growth of BASPS and the like now the other issue that was the beneficial ownership laws of course it goes to companies and BASPS are also to provide that information then the Ronald the Ronald he said that FIA should not be running out of it so we are not what I'm simply saying that with respect to ifs that is illicit financial of laws the mandate of FIA will be limited if they took this role because illicit financial growth involved both illicit activities and illicit activities the one for FIA are more concentrated on illicit activities so if we are going to do this role how about illicit activities that generate illicit transactions so for example for the issue of double taxation agreements that we cannot now be on championing to amend the laws with respect to those and also if I may go a bit further I already mentioned that under the 2063 development agenda for Africa that you of course arose from the the big report of 2015 it threatens the role of the country to manage illicit which is also now reflected in the 2063 agenda under the united nation under SDG 16.4 where countries are required now to measure and minimize illicit financial growth in order to release resources now when we were in the conference last week countries are supposed to make commitments and to start measuring illicit and measuring this illicit requires coordination because it is a massive problem requires coordination from a number of entities to generate data that can be required consistent with the statistical requirements of the UK so this is not what can be done by FIA because FIA is limited to operational issues but these are policy matters that are used so we are not running we are only appealing to authorities who can manage the policy issues that are wider to look into this and I think Chair, those are the ones I managed to thank you very much and maybe in terms of my concluding remarks, I think this engagement is very useful I think we need to continue and financially especially areas that we have identified look for and re-together on the same way forward thank you very much I believe the panellists really deserve quite an appreciation we are 30 minutes past our mark I'm going to request that we have Mr Onesmas Mugeni on behalf of the organisers of this meeting to share a few closing remarks and we'll call it a morning Onesmas you're welcome thank you James thank you very much we're already running out of time and I don't want to play you even for a minute you must agree with me this has been a very wonderful discussion and I once again thank you very much participants online and those who are here please I once again thank our panellists I think that has been an exceptional panel thank you very much for the people interventions the agency that we're able to be here and I think the interventions have been very wonderful the partnership Provo Financio Integrity Accord and Atacisco thank you for putting this together and for making this event happen and sharing this information I want to promise that we want added value. We want added value and I want to call all the agencies, government agencies in this room that we want added value. And we're going to be organizing strategic meetings, much smaller meetings where we can have a discussion between different agencies. So that the user will come on these issues and see is it the mandate that actually we need to expand? Is it the mandate that is limiting the operations? Is it something different? But you can also look at specific studies. For this study was so broad, we can now look at specific studies that look at certain issues that we see, how best can we deal with some of those issues? So I promise that's the layer where we can also make a useful contribution. Once again, thanks very much for your time and for your contribution. And we look forward to interacting again. Have a great day. Thank you. Thank you.