Update UBO-register for Wwft institutions
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In a letter to the House of Representatives, Minister Kaag expressed her support for opening the UBO register specifically to institutions subject to Wwft. An update and brief summary:
Reason and status of "temporary" closure of UBO register
There are insufficient leads from the point of view of preventing money laundering and terrorist financing to maintain disclosure to anyone. This means that Article 21 of the Trade Register Act 2007 needs adjustment and that access to the UBO register should be limited to competent authorities and the FIU, reporting institutions, and individuals and organizations that can demonstrate a legitimate interest.
A bill will soon be drafted for this purpose. In doing so, consultation will take place with the Chamber of Commerce in view of all the practical consequences, consequences for ICT and the close interconnection with the trade register.
At EU level
Each Member State will make its own assessment to determine whether it wants to go further than AMLD4 requires on this point. Therefore, it cannot be ruled out that there will be Member States that will keep UBO information publicly available, which may also involve reasons other than those related to preventing money laundering and funding terrorism.
Practical application of ruling during law change
An important group of users are the institutions referred to in the Wwft. They have an important task as gatekeepers of the financial system and are obliged to conduct client investigations, among other things. The UBO register is an important tool in this regard, and Wwft institutions are obliged in that context to consult the register, as well as to report discrepancies. As can be seen from the analysis above, the Court's ruling does not tamper with access to these institutions. Therefore, access to Wwft institutions will also be restored as soon as practical and implementable. However, the landscape of Wwft institutions is diverse, as are the technical modalities by which these institutions accessed the UBO register. In addition, many Wwft institutions are not directly connected to the UBO register, but through ICT vendors who have no legitimate interest in accessing UBO information. Identifying which individual institutions may have access and arranging this technically and practically is therefore complex and takes time. In this regard, an important user group is the large banks. These institutions are relatively easy to identify and connect. It is expected that access for this group can be restored relatively quickly. Efforts will be made in the coming period to also connect other groups of Wwft institutions as quickly as possible.
Regarding the obligation to consult the UBO register, the regulation from the April 14 parliamentary letter will apply until the connection of the relevant Wwft institution to the UBO register is restored.[1] Wwft institutions will be informed when they have access again. This arrangement is as follows:
[1] Kamerstukken II, 2021/22, 32 545, nr. 168
"In the event that a legal entity has made the declaration, but it has not yet been processed, it is sufficient for the reporting institution to establish that the declaration has been made, with the client's explanation of which UBO data and underlying documentation have been declared thereby. That the statement has been made can be determined on the basis of the confirmation email from the Chamber of Commerce. The client should inform the obliged institution as soon as the registration has been completed. Of course, the institution obliged to disclose always remains responsible - regardless of whether or not a legal entity has complied with the registration obligation (in a timely manner) - for customer due diligence, including the adequate identification of UBOs."[2]
[2] Kamerstukken II 2021/22, 32545, 168, p. 5.