The Beneficial Owners Registry with the Registrar of Companies
Obligations, Methodology and Procedure
Following the Article 61A of the Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2021 (the “AML Law”), the Registrar of Companies and Official Receiver (the “Registrar”), issued a regulation (Regulatory Administrative Act 112/2021) (the “Directive”) on the 12th of March 2021, identifying the obligations, methodology and procedure companies and legal bodies will have to follow in order to register their Beneficial Owners with the register it created accordingly.
Additionally, a Guidance note, (the “Guidance”), has been issued to guide about how the registration of Beneficial Owners (the “BO”) will be filed with the electronic system assisting in this respect the compliance with the directive and the law.
According to the Directive, a company and any other legal entity is obliged to collect and maintain adequate, accurate and updated information regarding their real beneficiaries. Also, the Registrar of Companies shall publish appropriate information and provide an electronic portal for relevant forms and filing of information on UBOs, without the submission of paper forms or filing fees.
The Directive applies to the following companies:
- Companies incorporated or registered under the Cyprus Companies Law, Cap.113;
- European public limited liability companies incorporated or registered under the Cyprus Companies Law, Cap. 113.
The following companies don’t fall in the scope of the Directive:
- Companies listed on a regulated market that are subject to disclosure requirements consistent with Union law;
- Companies whose directors submitted an application for strike off pursuant to Article 327 (2A) (a) of the Companies Law, prior to the commencement of the Directive, namely 12/03/2021;
- Companies whose liquidation has been enacted before the commencement of the Directive;
- Overseas companies subject to equivalent international standards which ensure adequate transparency of ownership information.
The information about UBOs that shall be submitted in the relevant electronic portal of the registrar, is as follows:
- Name, surname, date of birth, nationality and residential address;
- Nature and extent of the beneficial interest held directly or indirectly by each beneficial owner, including through percentage of shares, voting rights, or the nature and extent of the Significant influence or control with other means exercised by each controlling person;
- Identification document number indicating the type of document and the country of document issuance (Identity card or passport);
- Date on which the natural person was entered in the register as beneficial owner;
- Date on there were changes in the particulars of the natural person or the date on which the natural person ceased to be a beneficial owner.
According to the the Guidance published by the Registrar, it is explained that in the case that the shareholding structure of a Cyprus company liable to file the information as per the Directive, leads to Trusts as beneficial owner(s), the information that need to be submitted on the electronic portal of the Registrar of Companies, is limited to the following:
- Name of the trust;
- Registration number (if any);
- Country of jurisdiction of the trust.
In case of Trusts, the required information is limited because details in relation to the beneficial owner of the trust and its structure will be filed with the register to be set up and kept by the Cyprus Securities and Exchange Commission which will not be open to the public unless legitimate interest is proved.
In case that the shareholding structure of a Cyprus company liable to file the information as per the Directive, leads to foundation/s, other similar legal arrangements or listed companies as beneficial owner(s), the information that need to be submitted with the Registrar is as follows:
- Name;
- Registration number (if any);
- Country of jurisdiction;
- Business address;
- Nature and extent of the beneficial interest held directly or indirectly by each beneficial owner, including through percentage of shares, voting rights or the nature and extent of the significant influence* or control with other means exercised by each controlling person;
- Date on which the foundation, other similar legal arrangements and listed company was entered in the register as beneficial owner;
- Date on which changes in the particulars of a foundation, other similar legal arrangements and listed company were made or the date on which it ceased to be a beneficial owner for BO register purposes.
*Significant influence means the influence or control by a natural person over the company through other means such as agreements with the owners or due to other close relationship and influence.
The following options are available in the website of the Registrar under the section ‘significant influence or control with other means’:
- Through shareholder’s agreement;
- Through the exercise of dominant influence, influence through family links or other types of connection with decision-makers;
- Through the holding of negotiable shares or convertible stock;
- Through the power to appoint senior management;
- Other (Details to be provided accordingly).
Additionally, it is mentioned that in the event that no natural person is identified as the beneficial owner, the details of the senior management official must be submitted declaring also his position in the company i.e., whether it is a director or whether it holds another position.
Timeframes
Entities that were registered or incorporated before the date of enforcement of the Directive, i.e., 12th of March 2021, are required to submit the relevant information on Bos, electronically on the Registrar’s portal, within 6 months from the date of enforcement of the Directive the latest.
Entities that were registered or incorporated after the date of enforcement of the Directive are required to submit the relevant information on Bos, electronically on the Registrar’s portal, within 30 days from the date of incorporation or registration the latest.
If any change is made in the BO’s information, after submission on the Registrar’s portal, the new information must be submitted within at least 14 days from the date that the entity was notified of the change.
Each December, i.e., 1st of December until 31st of December of each calendar year, all entities must confirm electronically to the Registrar that theirs BOs and relevant information remain the same.
Access to the information
Competent Supervisory Authorities, the Financial Intelligence Unit (the “FIU”), the Customs Department, the Tax Department and the Police have fast and unlimited access to the information concerning the beneficial owner(s) through the electronic BO register with electronic means without the submission of a fee and notifying the legal entity.
Also, Obliged entities, in the context of conducting due diligence and identification measures for the client as defined in the Law, as well as all members of general public, have fast access with electronic means to the name, month and year of birth, nationality and country of residence of the BOs as well as to the nature and extent of the beneficial interest held.
There will be a fee payable for inspection of three euros and fifty cents (€3,50), per legal entity.
It is worth noting that during the six (6) months’ period available to existing entities for the submission of the BOs’ data, unrestricted access to the information concerning the BOs through the electronic BO register is granted only to the Competent Supervisory Authorities, the FIU, the Customs Department, the Tax Department and the Police upon submitting a written request to the Registrar.
Penalties
As per the Directive, the penalties applicable for failure to comply with the obligation to file information of their BOs are €200 and a further monetary charge of €100 for each day of non-compliance. The maximum amount payable for non-compliance is €20.000
In the event that the officers of the companies or any other legal entities had acted with due diligence in complying with the Directive and considering that non-compliance is not due to inaction, omission or negligence, they will not be subject to any monetary charge.
During the six (6) months’ period available to existing entities for the submission of the BOs’ data, the mentioned penalties are not applicable.
Procedures
In order for Companies and other legal entities and their officers to be able to submit data of their Bos, they need to register and obtain identification codes through the government gateway portal “ARIADNE” and then proceed with the authentication of the company’s profile.
The below listed documents must be presented at the time of registration:
- Company Registration Certificate;
- An official document from the company that created the profile, authorizing the individual presenting the documents, to submit the documents on behalf of the company. The name and Civil ID of the authorized individual shall be stated in the document and the document shall be signed by the director of the company;
- Authorized individual person’s Civil ID;
- Profile ID (16-digit number provided by email along with a copy of the said email).
Registration can be made only through physical visit of the authorised individual to one of the following centres:
- Point of Single Contact;
- District Post Offices;
- Citizens Service Centres.
Once the authentication is completed, the BO data will be possible to be registered in the system.