The anti-money laundering (AML) law of 18 September 2017 introduced an obligation for all Belgian companies, non-profit organisations, foundations and trustees to identify and record their ultimate beneficial owners (UBOs) and enter such UBO information into a UBO register. As the legal framework for the UBO register was however not yet in place, entities collecting UBO information were not able to register such information externally.
This is about to change with the publication of the Royal Decree of 30 July 2018 on the operating modalities of the UBO register (the Royal Decree). The Royal Decree specifies which information must be submitted to the UBO register and organises the process for registration with, and access to, the UBO register. The Royal Decree enters into effect on 31 October 2018 and Belgian companies and other reporting entities have until 30 November 2018 to make their first submission to the UBO register.
In a nutshell
The operating modalities set out under the Royal Decree confirm that the scope and impact of the UBO obligation is very wide.
The information that must be submitted to the UBO register is extensive, such as wide ranging ID information on the UBO (e.g. address of residence and ID-number) and, with respect to UBOs holding indirect ownership in a company, information on each intermediary entity. The registered UBO information must be kept up to date by the submitting entity. Failure to timely comply with these obligations may result in administrative or criminal fines of up to EUR 50,000 for directors and other persons in charge.
In addition, companies have the obligation to provide certain information on the UBO registration to their UBOs (e.g. on the modalities of registration and retention of UBO information and on third parties access rights to the UBO register).
The UBO register is widely accessible, not only by competent authorities or entities conducting AML checks, but also by the tax administration, which may then transmit information to foreign tax administrations. Certain UBO information is publicly accessible, including e.g. the name of the company's UBO, the interest held and, as the case may be, the entire chain of intermediary companies.
What should you do?
It is advisable for companies to start preparing their first UBO submission and assign staff for this purpose such that they can meet the deadline of 30 November 2018.
For UBOs it is helpful to know that they will receive notice by the register upon registration of their ownership. UBOs may monitor and correct the UBO information registered in their name and can, under certain circumstances, request that access to information related to them is restricted.
For assistance with your UBO obligations or for any additional information on this subject, please do not hesitate to get in touch with any of your regular contacts at Freshfields in Brussels.