The UBO register is almost online

On 23 June 2020, the Senate of The Netherlands approved the bill for the introduction of the UBO register. From 27 September, organisations are obligated to register the UBOs in the new UBO register. Starting September 27, organizations must begin registering UBOs in the new UBO register.

UBO means Ultimate Beneficial Owner

The UBO

An UBO is the 'ultimate beneficial owner' of an organisation. A UBO is the person who owns the organisation or has control within the organisation. These are, for example, natural persons who own more than 25% of the shares or persons who directly or indirectly have more than 25% of the ownership interest.

The purpose of the UBO register is to further combat money laundering or terrorist financing within the European Union

UBO register

All Member States of the European Union are obligated to keep a UBO register. The purpose of the UBO register is to further combat money laundering or terrorist financing within the European Union. The UBO register is designed to improve the transparency of who is ultimately in control within an organisation. This should make it more difficult for persons who commit financial and economic crimes to hide behind legal entities.

Who should register?

Registration for the UBO register will open on 27 September 2020. Organisations then have eighteen months to register in the UBO register. The following legal forms must register in the UBO register:

• Unlisted private and public limited companies
• Foundations
• Associations:
  • With full legal capacity
  • With limited legal capacity but with company
• Mutual guarantee companies
• Cooperatives
• Partnerships: partnerships, general partnerships and limited partnerships
• Shipping companies
• European public limited companies (SE)
• European cooperative societies (SCE)
• European economic partnerships that, according to their statutes, have their registered office in the Netherlands (EEIG)

Who has access to the data?

The UBO register will be public from 27 September 2020. The data of an organisation and its UBOs can be consulted by purchasing a Chamber of Commerce extract from the UBO register for €2.50. However, some authorities will have access to more information than others for investigating suspicious cash flows.

Data that is visible to everyone include the name, month of birth, year of birth, state of residence, nationality and the 'nature and size' of the interest that the UBO has:

• 25%-50%;
• 50%-75%;
• 75%-100%.

Data that is only visible to competent authorities, such as the tax authorities, include the date of birth, place of birth, country of birth, address, social security number, foreign tax identification number, documentation confirming identity and documentation substantiating the share interest.

Guarantees with the register

There are several basic principles associated with the UBO register. For example, everyone who wants to request data must pay a fee for this. To guarantee the reliability of the register, UBOs must substantiate the UBO statement with necessary documents. This should ensure that the registry information is correct. The register does not allow for searches by personal name but only by organisation name. It is also not possible to request large datasets in one go, and UBOs have insight into how often their data has been requested. However, UBOs cannot see who has requested the data.

Duty to report back

With the UBO register going live, the obligation to report back also comes into effect. This obligation applies to all companies subject to the AML and means that if the compliance investigation by the AML service provider reveals other information than is apparent from the UBO register, the AML service provider must report this to the Chamber of Commerce. This notification must be substantiated with documents. The Chamber of Commerce will start working on this report and inform the relevant organisation and give it the opportunity to check the information in the UBO register. This information is only requested from the legal entity and not from the UBOs. Please note: the obligation to report back has no consequences for the obligation to report unusual transactions. This transaction must still be reported to FIU-the Netherlands.

Consequences of Non-Compliance

If a legal entity has not registered the UBOs before 22 March 2022, there will be consequences. Failure to comply with the obligations is regarded as an economic offence and can be punished with imprisonment for a maximum of six months (offence) or two years (offence), a community service order or a fine of up to €21.750.

CDD On Demand & UBO register

CDD On Demand already offers the option of performing a UBO check (Dutch companies only)Chamber of Commerce registrations of the client are requested, and the company structure is made transparent. Based on this, (possible) UBOs are listed and you can immediately perform the compliance checks. This UBO check (Dutch companies only) is only available for Dutch legal entities. If the search leads to an organisation outside the Netherlands, an attempt is made to indicate a so-called “UBO connection”. This is the person who most likely knows who the UBO is.