INTERNATIONAL REGISTER (#UBO)
Effective Beneficiary or Ultimate Beneficial Owner
We introduced the concepts of the beneficial owner and the international public register a couple of years ago, with reference to its entry into force in July 2018 globally.
Here are the two links to the articles:
Now all states have issued or are issuing additional regulations, which specify some details of obligations, standards and information forms, penalties for non-compliance.
Under the Fifth Anti-Money Laundering Directive (#AML Directive (EU) 2018/843), which has been in force throughout the #EU since January 10, 2020, member states are required to maintain interconnected and publicly available national #Listed #Registers of Ultimate Beneficial Owners (#UBO).
Malta on 20/12/2017 adopted the fourth European Community Anti-Money Laundering Directive which provides for the establishment of the Register of Beneficial Owners with effect from 1.1.2018.
All companies which are incorporated and registered in Malta under the Companies Act or the Merchant Shipping Act must provide adequate information of the beneficial owner with name, surname, date of birth, nationality, documents, the nature and extent of the beneficiary’s interest and the date on which the person became a beneficiary.
Any change must be communicated promptly within the short time limits provided for by the legislation in force.
In this respect, Maltese companies are required to keep up-to-date information on their UBOs and are also required to notify the Registrar and to notify the Registry of any changes to the UBOs within 14 days of such changes.
The only exceptions are permitted in cases where all direct shareholders of the Maltese company are natural persons, or where the Maltese company is listed on a regulated market.
As a result of the above, as of 16 June 2020, the Registrar has introduced a new requirement that a Maltese company, in addition to the UBO register referred to above, must also file a UBO declaration at each anniversary of its registration.
A beneficial owner within a company is normally defined as the natural or legal person who holds indirect or direct ownership of more than 25% of the shares or a majority of the voting rights.
The information contained in the Register, in compliance with data protection legislation, is accessible to the national authorities responsible for combating money laundering and terrorist financing and they may provide data to the competent authorities of other European countries or third countries as well as to any person or organisation with a legitimate interest that may specifically contribute to the prevention, detection and combating of money laundering or terrorist financing.
In accordance with the Directive, this Register is interconnected with the Central Register of the EU and EEA Member States through the European platform and the European Justice Portal.
Similar services are provided by Trusts registered under the Trusts and Trustees Act and by Foundations and associations registered under Chapter 16 of the Civil Code.
If the persons who benefit from the legal entity have not yet been determined, the category of persons in whose interest the entity acts may be indicated.
In Malta, last June 16, the legal notice 247 2020 was published and came into force.
L.N. 247 of 2020
Companies Act (Register of Beneficial Owners)
(Amendment) Regulations, 2020
With the occasion, The Malta Business Registry, has published an elementary educational video to help understand the meaning and obligations of these rules.
The amendments to the 2017 regulations of the Companies Act (Register of Beneficial Owners) enter into force with the aforementioned legal notice 247 of 2020.
When submitting a declaration containing information on the beneficial owners of a company or an amendment, a certified copy of the official identification document for each beneficial owner must be submitted to the Register.
A new requirement has been introduced that a company must provide information on beneficial owners each year.
In the event of a change in the senior management of a company, the company itself must, within fourteen days of the date of registration of the change with the company, submit a notification of the change to the Registrar.
If at any time there is a change in the details of the beneficial owners, such as name, country of residence or official identification number, the company may submit a statement to the Registrar for registration.
The Registrar’s powers of registration have been extended. The Regulations provide that the Registrar may:
- Refuse to register any document of a company if information on beneficial ownership has not been submitted or if it is not satisfied that the company has provided accurate and up-to-date information on all beneficial owners of the company;
- Restrict new incorporations for directors involved in other registered Maltese companies who have not provided information on beneficial ownership;
- Before registering a new company, request the information or documentation it deems necessary to ascertain the correctness of the information on beneficial owners submitted to it.
The sanction provided for in the Regulations for cases where the Registrar of the Registry considers it necessary to update information on beneficial ownership in the Registry pursuant to the Regulations is increased and each officer of the company is liable to a sanction not exceeding one hundred thousand euros (100,000 euros).
The administrative sanctions have also been increased:
The new forms are accessible from the website https://mbr.mt/promo/official-registry-forms/
Companies can start using the new modules immediately.
To find out more about the subject and for dedicated advice you can contact the Legal Team of Maltaway.