Information Companies are required to maintain on the Register of Beneficial Owners
Most corporate entities incorporated in Ireland are obliged to maintain up to date, accurate and adequate details of their beneficial owners.
This obligation was introduced by Article 30 of the Fourth EU Anti-Money Laundering Directive (4AMLD) and transposed into Irish law by Statutory Instrument No. 550 of 2016. A beneficial owner is defined as a natural person who directly or indirectly owns, or controls, the company.
A natural person who holds a shareholding of 25% plus one share in a company, has direct ownership of the company. Indirect ownership in a company is defined as a “shareholding of 25% plus one share, or an ownership interest of more than 25 % in the customer held by a corporate entity, which is under the control of a natural person(s), or by multiple corporate entities, which are under the control of the same natural person(s)”.
Entities listed on a regulated market with disclosure requirements under EU law, or an equivalent requirement under international standards, are exempt from the requirement to maintain a beneficial ownership register. It should be noted that Irish subsidiaries of listed companies are not exempt from the application of the 4AMLD.
The following is a list of information which a company is required to hold on its internal register:-
- The name, address and date of birth of each beneficial owner. A beneficial owner is deemed to be a natural person and cannot be a company
- The date on which each beneficial owner was entered into register and also the date on which any beneficial owner ceased to be a beneficial owner
- A statement of the nature, and extent, of the interest held by each beneficial owner
- The register should contain the personal details of the senior managing officers of the company, in circumstances where no natural persons can be identified, or there exists a doubt as to their identity
A template register of beneficial owners can be found on the Companies Registration Office (CRO) website.
The requirement to maintain a beneficial ownership register may be an arduous challenge for complex legal entities where the identity of the natural beneficial owners are not readily apparent. A company must exhaust “all possible means” in attempting to uncover the identity of the natural beneficial owners. It is only after a company has exhausted all possible means of identifying the natural owner, and a natural person cannot be identified, (or there is doubt as to the identity of the natural owners) that it may then include details of the company’s senior managing officers on the register.
If there is a doubt as to the beneficial owner’s identity, a company can write to any party seeking confirmation of their identity as a beneficial owner, or to any third party whom the company believes may know the identity of the beneficial owner. This party then has one month within which to reply to the written notice.
Companies should be aware that, under the 4AMLD, failure to maintain this register is a criminal offence punishable by a fine on summary conviction of up to €5,000.
The Department of Finance is currently drafting transposing legislation for the remaining obligations imposed by the 4AMLD. This will likely establish the CRO as the entity legally responsible for maintaining a central register of beneficial owners. It is anticipated that this central register will require companies to submit details of beneficial owners through an online portal and no filing fee will be payable. The CRO have stated that there will be an extended deadline of at least 3 months for companies to comply with their obligations under the Regulations.
The Fifth EU Anti-Money Laundering Directive broadens the scope of the 4AMLD in that it will grant the public access to the central register of beneficial owners. It is expected that the central register will operational by late 2019 or early 2020.
This is for information purposes only. If you require legal advice on these obligations or have any other queries, please contact Jacinta O’Sullivan or any member of our commercial team.