This time, we would once again draw attention to the duty to disclose the true beneficiaries, in the shape of natural persons, of private limited liability companies (SIA), public limited liability companies (AS) and partnerships.
The Commercial Law requires shareholders of companies (SIA and AS) and members of partnerships to inform their company about the company’s true beneficiaries in the shape of natural persons. This obligation refers to:
- shareholders that are legal entities holding more than 25% of shares in the company and that are established outside the European Union; or
- shareholders of companies holding more than 25% shares in the company in their own name but for the benefit of another person irrespective of the state of establishment of the shareholder.
It is the duty of the company’s board to file information on the true beneficiaries with the Commercial Register within 14 days after receiving the information from the shareholders. In order to ensure observance of the Commercial Law, we advise company boards to introduce these rules to shareholders.
If company shareholders cannot identify the true beneficiary for objective reasons or no such person exists, then under the Law on Prevention of Laundering of the Proceeds of Crime and Terrorist Financing (for example, no natural person directly or indirectly owns at least 25% shares in the company) the shareholders must state in the notification why data about the true beneficiaries are not provided.
Information about true beneficiaries will not be publicly available. That is, only law enforcement and supervisory institutions will be entitled to it.
The Commercial law does not establish a special mechanism for checking performance of this obligation. Therefore performance is most likely to be controlled under the Administrative Violations Code, which lays down responsibility of company board members for non-supply of data to the Commercial Register within the term specified by law.
Additionally it should be noted that shareholders who knowingly supply incorrect information may be subject to criminal liability.