12/2018: UBO-REGISTER: MANDATORY REGISTRATION OF THE ULTIMATE BENEFICIAL OWNER BY 31 MARCH 2019 AT THE LATEST
As part of the fight against money laundering and financing of terrorism, it has been stipulated at European level that Member States must ensure that information on Ultimate Beneficial Owners (or UBO for short) is held in a central register.
Pursuant to this European requirement, on 31 October 2018 the Belgian UBO Register became operational. This is an electronic register – managed by the Treasury Administration – that aims to gather and make available adequate and up-to-date information about the UBO of companies and other legal entities established in Belgium.
As the parties responsible for providing the information, the directors of companies and other entities are required to communicate the information and documentary evidence of their UBO to the UBO Register by 31 March 2019 at the latest. The accuracy of the information in the UBO Register must be confirmed annually by the parties responsible for providing the information and in the event of a change, the information must be updated within one month.
Who are the entities subject to this?
The UBO Register must include information concerning the ultimate beneficial owners of:
- (International) not-for-profit associations and foundations
- Trusts, fiduciaries or similar legal entities
established in Belgium.
The legislation does not stipulate precisely which entities qualify as a company, but based on Belgian corporate law, companies without legal personality such as civil-law partnerships also fall into this category.
Who is an UBO ?
The ultimate beneficial owners of a company are the natural person or persons who directly or indirectly, alone or together with others, exercise control and/or retain a sufficient patrimonial interest in the company, where (in)direct ownership of more than 25 percent of the voting rights or shares is deemed to be an indication of a sufficient percentage.
Persons who exercise control in the company via other means, such as via joint voting agreements, via statutory clauses or via shareholders’ agreements may also qualify as ultimate beneficial owners.
Insofar as no natural persons can be identified as ultimate beneficial owners on the basis of control or patrimonial interest, the so-called senior executive personnel (CEO) of the company may be regarded as ultimate beneficial owners.
There are also specific statutory provisions regarding who exactly should be considered the ultimate beneficial owner for (international) not-for-profit associations, foundations, fiduciaries and trusts.
What information must be communicated and when?
- Name, date of birth, home address, national registration number, nationality(ies), country of residence and full residential address of the ultimate beneficial owner as well as their identification number on the national register or from the Social Security Database, and where applicable, any comparable means of identification that is provided by the country where they reside or of which they are a national;
- The time at which this person became an ultimate beneficial owner, and on what basis this person is considered to be an ultimate beneficial owner: the size (percentage) of the interest of this person in the company and whether this is a direct or indirect UBO (in the case of the latter, the number of intermediaries and the identity details of this/these intermediary(ies) must also be specified);
- The nature of the control / interest (via shareholding, other means or executive personnel)
- Whether a direct or indirect ultimate beneficial owner is involved;
- If an indirect ultimate beneficial owner is involved, the number of intermediaries as well as, for each of them, the complete identification details, with at least the name, the date of establishment, the trade name, the legal form, the address of the corporate headquarters and the business number or any other comparable means of identification that is provided by the country where the intermediary is registered;
- The size of the ultimate interest in the party responsible for providing the information
The processing of this personal data is subject to the applicable legislation on protection of personal data.
How must the information be communicated?
The information must be transferred to the UBO Register via the online platform MyMinFin. The responsibility rests with the governing body but the governing body may designate an internal or external representative for this purpose.
Who has access?
Access to the UBO Register is very broad as regards companies. The register is accessible for:
- The competent authorities. That is any public body with the statutory task of combatting money laundering and financing of terrorism (or associated predicate offences such as serious fiscal fraud, whether organised or not).
- Entities subject within the context of customer due diligence imposed on them such as financial institutions, insurance companies, notaries, lawyers and accountants.
- Any citizen (private individual) (a legitimate purpose must only be demonstrated in searches of associations and trusts).
Access is more limited with regard to (international) not-for-profit associations, foundations, fiduciaries and trusts. Not just any citizen, but only those who can demonstrate a legitimate interest may access certain data.
It is not possible to search for the name of the ultimate beneficial owner themselves via the electronic register. Searching for ultimate beneficial owners may only be conducted on the basis of the name or the business number of a company. Any citizen shall thus be able to look up who the UBO of a company is and the extent of their interest in the company concerned. For reasons of privacy, he may not access certain information such as the first name, place of residence or date of birth.
A cost to be defined shall be charged for a search in the UBO Register.
Besides a general corporate fine of EUR 400 to EUR 40,000, an additional administrative fine of between EUR 250 to EUR 50,000 may be imposed on the members of the administrative body under the specific legislation concerning the UBO Register.
Which steps should be taken now?
Although there are still a few months to go, it is best to prepare yourself in good time. In particular, in more complex (international) group structures, gathering the required information and evidence may take some considerable time. If the natural person or persons who are the ultimate beneficial owners retain the required interest via a chain of intermediaries for example, each of these entities must always be identified. Furthermore, the necessary documents in support of the information must be gathered in order to be electronically communicated to the register.
The information can technically already be communicated via MyMinFin to the UBO Register.
Practical information is available at: https://financien.belgium.be/nl/E-services/ubo-register