On 7 June 2017, the draft bill of the Beneficial Owners Register Act (Wirtschaftliche Eigentümer Registergesetz) was approved by the Austrian Government.
The government bill provides for the setting up of a register that contains data on any natural person who ultimately owns or controls certain entities such as limited liability companies, stock corporations, partnerships, private foundations, associations and certain trusts managed in Austria. The purpose of the register (which implements articles 30 and 31 of the 4th EU Anti-Money Laundering Directive) is to prevent the flow of illicit money by way of money laundering and financing of terrorism.
According to the draft, the respective entities have to determine their beneficial owners and subsequently submit the relevant data electronically. As regards corporate entities, an individual qualifies as beneficial owner if he/she holds direct or indirect ownership of more than 25% of the shares. If no such person can be identified, the members who hold the position of senior managing officials are deemed to be beneficial owners for the purposes of the register. As regards trusts, the settlor, the trustee, the protector (if any), the beneficiaries and any other natural person exercising ultimate control over the trust are considered to be beneficial owners. Likewise, as regards private foundations, the founder, the beneficiaries, the members of the board of directors and any natural person exercising ultimate control over the private foundation are seen as beneficial owners.
Further, the draft bill contains several exemptions from the reporting obligations, e.g., for limited liability companies having only individuals as shareholders (in which case those shareholders with a participation of more than 25% are deemed to be the beneficial owners).
In order to ensure data protection, access to the register data is limited and only available (i) to banks, attorneys, notaries public etc. within the framework of customer due diligence; (ii) to certain agencies concerned with anti-money laundering; and (iii) upon written request to any person that can demonstrate a legitimate interest in connection with the prevention of money laundering and financing of terrorism.
The bill is expected to come into force as of 15 January 2018. Intentional infringements of the reporting obligation constitute a fiscal criminal offence with a penalty of up to EUR 200,000.