Ultimate Beneficial Owner (“UBO”)
Who is the UBO of a company under the new legislation?
UBO is every individual who is the ultimate beneficiary or a person with ultimate influence. In case it is not possible to identify the actual UBO, a UBO is every individual in the position of senior managing official.
How to identify the UBO?
The company is obliged to know its UBO and must exercise all reasonable efforts to identify them. The UBO, the ultimate beneficiary, the person with ultimate influence and the person through whom the ultimate beneficiary benefits/exercises its influence, are obliged to inform the company of the grounds the UBO’s position and provide necessary cooperation to fulfil the registration obligation.
What should your company do?
If your company does not have/cannot identify the UBO
- Every senior managing official will be registered, i.e. persons who ensure day-to-day or regular management of the company and who are:
– members of the statutory body/ persons in a similar position / persons who represent another legal entity in such body, or
– directly subordinate to the statutory body or its member.
- If an entity that is the person with ultimate influence does not have any UBO or the UBO cannot be identified, and a senior managing official is identified as the UBO as a result, such senior managing official is considered to be the UBO of all companies in the subordinate ownership structure.
- The company is obliged to record steps taken to identify the UBO.
What data will be entered in the new UBO Register?
- Details about the UBO (name, address of residence or domicile, date of birth, birth certificate number, citizenship)
- Details about the nature of the UBO’s position (size of the UBO’s share or information about other grounds constituting the UBO’s position)
- Description of the structure of relationships, including identification data • The date of establishment and termination of the UBO’s position
- Details about the company (business name and identification number)
- Other information (date of the automatic transfer of data, time of making valid data available or a note of discrepancy)
- If the data entered cannot be verified in other registers, the registration application to a court or notary public must be supported by simple copies of documents proving the identity and position of the UBO, typically an extract from foreign public registers, Articles of Association, list of shareholders, decision of a company’s body on dividend payment, shareholder’s declaration of acting in concert, affidavit of the UBO or the company itself, and relevant identification documents to prove identity.
- Documents in a foreign language must be supported by a simple translation into the Czech language (unless the court or notary states that the translation is not required).
Solution of discrepancies in the UBO Register
The company must ensure that the valid data about its UBO correspond with the actual state.
Public authorities and persons obliged under the AML Act will inform the court which maintains the UBO Register that they have discovered discrepancies in the registered data in the course of their activities. The court will request the company to correct or refute the discrepancies within an adequate period, and if the company fails to do so, the court will initiate the proceeding on discrepancies. The court will record a note of discrepancy into the UBO Register. If the discrepancy is refuted in the proceedings, the court will mention the judgment in the UBO Register and delete the note. If the discrepancy is confirmed, the court will mention the judgment in the UBO Register, delete incorrect data and enter new data if they have been revealed in the proceedings (or the company is obliged to do so).