London, UK, November 01, 2021 – McapMediaWire – In our previous article ‘Update UBO register’ 1, you could already read that companies and non-profit organisations have until 31 August 2021 to comply with the provisions concerning the UBO register. Meanwhile, almost two months have passed and the FOD Financiën is serious. Those who do not comply with the registration can expect an administrative fine.
The UBO register is a register in which all the ‘Ultimate Beneficial Owners’ of a company or other legal entity are registered. The register is part of the fight against money laundering and seeks to put an end to the practices of money launderers who launder money through the creation of companies as intermediaries. Such a UBO register should make it possible to find out who is behind certain legal arrangements and entities. The intention is therefore to register details of the most influential actors.
The new UBO register will require companies, (international) non-profit organisations and foundations, as well as trusts and other legal entities similar to trusts, among others, to obtain and maintain adequate, accurate and up-to-date information on their Ultimate Beneficial Owners (UBOs). In addition, the Act provides for the obligation of directors to electronically transmit information on the beneficial owners to the UBO register within one month, under penalty of financial fines.
Ultimate beneficiaries in the case of companies include natural persons who hold a sufficient percentage of the voting rights or of the ownership interest in the company. A percentage of 25% is considered as sufficient. Individuals who have a degree of control by other means or who are members of the senior management are also ultimate beneficiaries.
- (International) non-profit organisations and foundations
Ultimate beneficiaries in the context of non-profit organisations and foundations include:
- the members of the board of directors;
- the persons authorised to represent the association;
- the persons in charge of the daily management of the (international) association or foundation;
- the founders of a foundation;
- the natural persons or, if these persons have not yet been designated, the category of natural persons in whose main interest the (international) not-for-profit association or foundation was established or operates;
- any other natural person who ultimately controls the (international) association or foundation through other means.
- Trusts and other legal entities similar to trusts
Are considered as beneficial owners in case of trusts, fiduciaries and other legal arrangements similar to trusts:
- the settlor;
- the fiduciary or trustee(s);
- the protector, if any;
- the beneficiaries, or if the persons who are the beneficiaries of the fiduciary or trust have not yet been designated, the category of persons in whose main interest the fiduciary or trust was established or operates;
- any other natural person who, by virtue of being a direct or indirect owner or by other means, ultimately controls the trust.
It’s a nice initiative, but the practical implementation of it is proving to be quite challenging. The deadline for registering the beneficial owners in the UBO register has been extended several times.
As of 11 October 2020, every obliged entity is obliged to include in the UBO register every document that supports and proves the adequacy, accuracy and timeliness of the data. It is no longer sufficient to simply present these documents for verification purposes. This includes the identity card of the UBO, the deed of incorporation and the articles of association of the company, etc.
One would have the time until 30 April 2021 to submit these documents, but again the deadline for uploading supporting documents and annual confirmation of the information in the UBO Register was extended to 31 August 2021. This according to Minister of Finance, Vincent Van Peteghem, in order to be able to support authorities to comply with the new rules imposed by the Royal Decree of 23 September 2020.2
In the meantime, we are at the end of October ’21 and the FOD Financiën has become serious. Companies that have not followed up on the tax authorities’ reminder letters to bring their registration in order will be faced with an administrative fine of €500.00 per director. This would concern approximately 80,000 companies that have not yet put their registration in order.
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