Foreward by Andrew Chilvers
When the 5th Anti-Money Laundering Directive was introduced into law by the UK and EU in January 2020, for many professionals it was a much needed addition to legislation that would significantly help business transparency and combat money laundering. In essence, it was good for business and for public and professional confidence.
All jurisdictions signing up to the 5th Directive will build and maintain UBO registries that will be publicly available at any time. UBO registries will also be set up for bank accounts and trusts, although these latter two will not be publicly available but be accessed by the relevant authority such as financial intelligence units and legal advisors looking into money laundering. Investigative journalists who can show a legitimate interest in the case can also have access, which is vital if another Panama Papers (see below) is to be uncovered. Across the UK and EU national UBO registers will be set to connect through a central European platform by April 2021.
Please provide a brief overview of the UBO Register in your jurisdiction and its history?
Legal entities under private law, registered partnerships (“associations” as defined by the GwG) and several others must register the information on their so-called “beneficial owners” for entry in the transparency register. This has to be completed without any undue delay as from the point when any change occurred. A beneficial owner is any natural person who directly or indirectly holds more than 25 percent of the capital shares, controls more than 25 percent of the voting rights or exercises control in a comparable manner.
How can your firm ensure your clients are fully compliant with the new / existing requirements?
Our firm has the expertise to advise on specific registration requirements and will happily assist with the registration process.
We have a history of advising with complex corporate restructurings in the course of which we also include the fulfilment of registration requirements. However, in case our clients need to hide their business undertakings from competitors, we can also offer means and ways to maintain their secrecy.
What changes can we expect to see emerging, are any new proposals expected?
German authorities have commenced addressing legal entities that have yet to complete their registration. Leaving any such enquiry unanswered can cause significant fines. But if answered correctly, there is a fair chance to avoid fines entirely.
What other information might be relevant?
As the information to be registered derives from corporate law, we strongly advise to have the registration completed by trained legal personnel. Everybody should bear in mind that any legal entity will be required to register their information even if there is no real person financially benefiting from the company. Trusts, for instance, are required to register their board members because they merely control the trust whilst not financially benefiting from its profits.