What does the UBO register entail for you?
In view of the Act on the prevention of money laundering and the financing of terrorism in the Netherlands, Minister Hoekstra submitted the bill regarding the “Ultimate Beneficial Owner” (UBO) to the Lower House of the Dutch Parliament on 4th April 2019. The UBO register will be effective in the Netherlands from January 2020.
Ultimate Beneficial Owner means any natural person who – since he owns 25% or more of the shares – ultimately owns or controls the client and/or natural person on whose behalf a transaction is made.
Institutions under the Act on the prevention of money laundering and financing of terrorism in the Netherlands (Wwft) are obliged to find out who the Ultimate Beneficial Owner (UBO) is of a business relationship.
Who must register?
Companies and legal entities established in the Netherlands having their registered office in the Netherlands according to their articles of association, such as a VOF (general partnership), CV (limited partnership), BV (private limited company), NV (public limited company), Trusts etc., must register certain information. Self-employed persons, public bodies, Owner’s Associations and so on are exempt from registering the UBO details.
Where and what will be registered?
The details of such Ultimate Beneficial Owner are entered in what is called the UBO register, which is managed by the Chamber of Commerce. A distinction is made between two types of data:
- Public data that is accessible to everyone, such as name, month and year of birth, nationality, state of residence of the UBO and nature and extent of the economic interest in the company. The exact extent of the economic interest will not become public, only a bandwidth (25% – 50%, 50% – 75% or 75% – 100%); and
- Non-public data that can only be accessed by certain competent authorities, such as social security number, address, date and place of birth, copy of identification.
The intention is at a later stage to link the Dutch UBO register to UBO registers in other EU member states. UBOs from foreign companies are not included in the Dutch UBO register.
The register complies with the data protection requirements and the General Data Protection Regulation. In view of the protection of the privacy of the UBO, everyone who requests information will be registered and identified and a fee must be paid to view this data.
In addition, not all registered data will be made public for everyone.
In exceptional cases, the UBO can also submit a request not to disclose this information, for example if there is a risk of fraud, abduction, etc. for the respective UBO.
The responsibility to have all UBO data registered with the register, which is mandatory, is vested in the company. In case of failure to register, incomplete registration or failure to keep the registration up to date, an administrative fine may be imposed and this may qualify as an economic offense.
All institutions under the scope of the Act on the prevention of money laundering and financing of terrorism, such as civil-law notaries, banks, accountants, tax advisers, etc., have a feedback obligation under this UBO law. They are obliged to report to the Chamber of Commerce if they have information that differs from the information in the UBO register.
After the introduction of the law, the UBO register will not be immediately operational and there is an 18-months’ transitional arrangement for registration in the UBO register for entities that already exist at the time the bill becomes effective. For entities that are incorporated after the effective date, there will be no transitional arrangement, which means that they must register with the UBO register immediately upon registration with the Trade Register.
Should you have any questions about the UBO register, please contact your AAme adviser.