Registers of beneficial owners in different countries

Registers of beneficial owners in different countries 11.06.2019

In the light of worldwide business transparency strengthening trend some states and territories have applied or are currently applying registers of beneficial owners of companies. Due to this fact the requirement to disclose to public authorities details of natural persons who are ultimate beneficial owners of companies is being established.

The creation of registers of beneficial owners is a large-scale process and embraces a sufficient number of states, so that during implementation and functioning of these registers in each state as common features which characterize this process everywhere, so distinctive features which are typical just for one jurisdiction or for a group of jurisdictions may be encountered.

Common features

The approach to definition of beneficial owner of the entity by criterion of the ownership interest is identical in all states which applied registers of beneficial owners:  a person is deemed to be beneficial owner if he owns more than 25% of interest in entity’s capital (shares or voting rights). Generally, the direct and indirect ownership are both taken into consideration.

Besides this, the detection of beneficial owner may be made with the use of criterion of management and control, i.e. the functions to make key decisions concerning company’s business. Such key decisions may be made in relation to distribution of company’s profits, appointment of senior managing officers, approval of financial statements, etc.

The legislation of the majority of jurisdictions establishes the rule according to which beneficial owner is a natural person who ultimately owns the profits of a company or of a group of companies. In some jurisdictions entering of legal entities’ details into the register of beneficial owners or making of a note that company does not have beneficial owners is possible only in case when all measures to identify natural persons who are deemed to be beneficial owners using all applicable criterions (interest, management and control) have been taken without result.

Some common law jurisdictions or jurisdictions having elements of common law in its legal system implement registers of beneficial owners of trusts and some similar structures without legal personality. The beneficial owners of such structures may be founders, protectors and trustees.

The main declared aim of detection and identification of beneficial owners is minimizing of money laundering and terrorist financing risks (ML/FT), and additional aims are international exchange of tax information and tax administration of commercial activity of companies. Due to this fact the national legal acts that establish registers of beneficial owners in different jurisdictions pertain to ML/FT sphere.

Most frequently the volume of information to be provided includes identification data of a natural person (names, date of birth, nationality, the number of ID document, residence address), and it is often required to inform on the nature of beneficial ownership (the amount of interest in a capital, type of management and control).

Differences and distinct features

The most important feature that differs registers of beneficial owners in some states is the information availability regime. There are two basic approaches to such regime:

  • Confidentiality.  In this approach the information from registers of beneficial owners is provided only to public authority responsible for incorporation of a legal entity. In its turn, such public authority is entitled to disclose the information about beneficial owners only to a list of persons as prescribed by the law, mainly to tax and law enforcement agencies. Most frequently such disclosure is possible only at request made by such persons.
  • Public availability. This approach presumes that any third party may have an access to information of beneficial owners by using official resources. The restriction of access to such information is possible only in particular cases (intellectual property protection, residence of beneficial owner in territories with highly criminal environment, etc.) when applied for by the company.

Other differences and distinctive features are basically of technical character and include forms and formats of registers submitted to public authorities, the procedure and deadlines of their submission, existence of online platform for these purposes, etc.

It must be noticed that in the EU creation of registers of beneficial owners is not the initiative of each member state itself, but the measure to fulfill the requirements of Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU.

All EU member states must implement registers of beneficial owners before 10 January 2020, and by 10 March 2021 all registers of EU member states must be connected to one joint database.

Jurisdictions that applied registers of beneficial owners

EU member states

United Kingdom
  • Information from registers of “persons with significant control” is publicly available
  • Such information may be obtained in the official webpage of Companies House (section “Persons with significant control” of company profile). The service is free, no registration is required.
  • Next information of persons with significant control is disclosed:
    1. Name and surname
    2. Month and year of birth
    3. Nationality
    4. Country of residence
    5. Correspondence address
    6. Date on which the control started
    7. Nature of control
  • The duty to provide information to registers is applicable since 30 June 2016 to companies and LLPs, and since 24 July 2017 – to Scottish LPs
Latvia
  • Information from registers of beneficial owners is publicly available
  • Such information may be obtained in the official webpage of Companies database in the section “Beneficial owners” and must be paid. Registration on a website is also required
  • Next information of beneficial owners is disclosed:
    1. Name and surname
    2. Identification number
    3. Nationality
    4. Country of residence
    5. Nature of control
  • The duty to provide information to registers is applicable since 1 March 2018
Estonia
  • Information from registers of beneficial owners is publicly available
  • Such information may be obtained in the of Business Register and must be paid.
  • Next information of beneficial owners is disclosed:
    1. Name and surname
    2. Identification number
    3. Country of residence
    4. Nature of control
  • The duty to provide information to registers is applicable since 1 September 2018
Denmark
  • Information from registers of beneficial owners is publicly available
  • Such information may be obtained in the of Register of companies, payment and registration is not required
  • Next information of beneficial owners is disclosed:
    1. Name and surname
    2. Residence address
    3. Nature of control
    4. Date of last change of information
  • The duty to provide information to registers is applicable since 1 December 2017
Malta
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Identification number
    4. Nationality
    5. Country of residence
    6. Nature of control
  • The duty to provide information to registers is applicable since 1 January 2018 
Ireland
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Nationality
    4. Residence address
    5. Nature of control
    6. Date of beginning and the end of control
  • The duty to provide information to registers will be applicable since 22 June 2019
Luxembourg
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Identification number
    4. Nationality
    5. Country of residence
    6. Nature of control
  • The duty to provide information to registers is applicable since 1 March 2019
Lithuania
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. ID document number
    4. State which issued ID document
    5. Country of residence
    6. Nature of control
  • The duty to provide information to registers is applicable since 1 January 2019
Germany
  • Information from registers of beneficial owners is confidential, however the special portal has been created for request of information of company’s beneficial owners by different categories of persons
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Country of residence
    4. Type of beneficial ownership (fictitious or real)
    5. Nature of control
  • The duty to provide information to registers is applicable since 1 October 2017
Cyprus, the Netherlands, Hungary, Poland and Romania are in the stage of adoption of national legislation of beneficial ownership registers and/or their practical implementation.

Other states and territories

British Virgin Islands
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Nationality
    4. Residence address
  • The duty to provide information to registers is applicable since 1 July 2017
Cayman Islands
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. ID document number and date of issue
    4. State which issued ID document
    5. Residence address
    6. Date of beginning and the end of control
  • The duty to provide information to registers is applicable since 27 November 2017
Hong Kong
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. ID document number
    3. State which issued ID document
    4. Correspondence address
    5. Date of beginning and the end of control
    6. Nature of control
  • The duty to provide information to registers is applicable since 1 March 2018
Singapore
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. ID document number
    3. State which issued ID document
    4. Correspondence address
    5. Date of beginning and the end of control
    6. Nature of control
  • The duty to provide information to registers is applicable since 31 March 2017
Switzerland
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Nationality
    4. Residence address
  • The duty to provide information to registers is applicable since 1 July 2015
Lichtenstein
  • Information from registers of beneficial owners is confidential
  • Further information must be entered into the register:
    1. Name and surname
    2. Date of birth
    3. Nationality
    4. Residence address
  • he duty to provide information to registers is applicable since 29 January 2019
Tags: offshores, beneficial owners

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