Registers of beneficial ownership: new rules to be implemented soon

 

 

Draft law No 7217 is to implement new transparency measures provided by Directive 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (“AMLD 4”) through the creation of a central register of beneficial owners (“BOs”). The draft law (which will still have to undergo the complete legislative process in Parliament) provides for some specific safeguards against improper access to said register. The register will be set up under the authority of the Minister of Justice.

 

Central register of beneficial owners of Luxembourg legal entities

 

Scope

 

All Luxembourg commercial companies as well as any other legal entities registered with the trade and companies’ register fall within the scope of such draft law. This includes, among others, the following types of entities: public limited companies (sociétés anonymes), private limited companies (sociétés à responsabilité limitée), partnerships limited by shares (sociétés en commandite par actions), common limited partnerships (sociétés en commandite simple), special limited partnerships (sociétés en commandite spéciale), foundations, civil companies, interest groupings (GIE), European interest groupings (GEIE) and investment funds (fonds d’investissement). Listed companies (under certain circumstances), common funds and branches of foreign companies are out of scope.

 

 

"Relevant “in scope” Luxembourg entities are required to obtain and keep adequate, accurate and up-to-date information on their BOs at their registered office."

 

 

New requirements

 

Relevant “in scope” Luxembourg entities are required to obtain and keep adequate, accurate and up-to-date information on their BOs at their registered office. Such information must further be uploaded into the central register of BOs (Registre des bénéficiaires effectifs), the so-called REBECO, maintained by the Luxembourg trade and companies’ register. Existing entities will have up to 6 months after the entry into force of the draft law to register the relevant information with the REBECO.

 

in the Information to be availableREBECO

The information must include the identity of the BO, date and place of birth, nationality and private or professional address of residence as well as the BO’s nature and extent of beneficial interests held in the relevant entity. The information must be accurate, complete and up-to-date. The information will be kept in the REBECO for a period of 5 years after the winding-up of the subject entity. All persons having access to the REBECO and becoming aware of incorrect or missing information must inform the REBECO thereof without delay.

 

Access to the REBECO

 

The information contained in the REBECO will be made available electronically only to national competent public authorities, including but not limited to the public prosecutor, the Commission de Surveillance du Secteur Financier (CSSF), the Commissariat aux Assurances (CAA) and tax administrations. This access is unrestricted. Self-regulatory bodies (such as the Bar Council, Notary Chamber and the IRE) will have a limited electronic access to the REBECO within the strict context of their supervisory functions. Only partial information may be disclosed to these self-regulatory bodies. AML obliged entities (such as for instance credit institutions, professionals of the financial sector, insurance undertakings, lawyers and auditors) will also have a limited electronic access to the REBECO which may be used only where such AML obliged entities are required to carry out client due diligence measures in relation to their clients. Physical access may finally be granted to any person or organisation that (i) can demonstrate a legitimate interest in relation to AML, (ii) is resident in Luxembourg and (iii) has made an official written and duly justified request in this respect. Such access is subject to the prior approval of a formal commission to be created by the Minister of Justice. Any subject entity may request a restriction of access to the REBECO where such access would expose the BO to a risk of fraud, kidnapping, blackmail, violence or intimidation, or where the BO is a minor or otherwise incapable.

 

Criminal sanctions may be imposed for non (timely) compliance with this new regulation.

 

So time to get ready…