What is a UBO?
The abbreviation means Ultimate Beneficial Owner, i.e. the person or entity that is the ultimate beneficiary of the company. Certain financial and other organisations, including banks, currency exchange offices and insurers, are subject to mandatory disclosure of the UBO if doing business with any party. The underlying reason of this provision is preventing natural persons with malintent, such as money-laundering or financing terrorism, from being able to hide behind a company, foundation or other legal entity.
Which data will be kept?
For companies: the ultimate beneficial owner of a legal entity. This is the natural person who holds an interest of at least 25% in the legal entity’s capital or can exercise at least 25% of the voting rights at the general meeting of shareholders or is the beneficiary of at least 25% of the legal entity’s capital.
Initially from 16 October 2017. For practical reasons, companies, a(i)sbl and foundations got a procedure introduction time to collect and hold information on their beneficial owners so the final first registration is delayed until the 31st march 2019.
Every change must be mentionned within the month.
Every year the accuracy must be confirmed.
Who may look into the register?
The authorities has unlimited access.
Civilians, who can demonstrate the importance for the foundation or other legal entity has a limited access.
After registration there’s a possibility to receive excemption, in this case the beneficial must be a public person, a prominent politician or in case of fraud, abduction and extortion.
Penalties for non-compliance
It is important for you to accurately and structurally document your efforts. Ensure that you can demonstrate compliance with the Money Laundering and Terrorist Financing (Prevention) Act in the event of announced or unannounced inspections. Due to the complexity and strict rules, an increasing number of organisations chose to automate the process.
Penalties up to EUR 1,350,000 may be imposed for non-compliance.
These sanctions are separate from a range of other administrative or disciplinary sanctions that may be imposed.
Ultimate parent company
In addition to the Ultimate Beneficial Owner or UBO, there is something referred to as the Ultimate Parent Company (UPC). That is the company on the very top of the organisation structure.