“The 5 W’s of the RBO”
This issue of the Gatal Gazette is dedicated entirely to the Register of Beneficial Owners Central Register regulations introduced recently that affect all Irish incorporated companies.
Directors and stakeholders of Irish companies will be hearing a lot about this subject in the coming months and our aim with this article is to highlight the main areas that you need to be familiar with under the principle of the 5 W’s, widely attributed to the writings of Aristotle, namely, Why? Who? What? When? and Where?
1. WHY were these new regulations introduced?
Article 30(1) of the European Union’s Fourth Anti-Money Laundering Directive (4AMLD) requires all EU Member States to put into national law provisions requiring corporate and legal entities to obtain and hold adequate, accurate and current information on their beneficial owner(s) in their own internal beneficial ownership register and Article 30(3) of 4AMLD requires that the information referred to above be held in a central register in each Member State.
In late 2016, the requirement came into force for all Irish companies to hold accurate and current information on their beneficial owners. Following on from these regulations, a company or beneficial owner who now fails to comply with the Regulations shall be liable on summary conviction to fine not exceeding €5,000 and/or a term of imprisonment up to twelve months. It is expected that by March 2021, all EU countries will have implemented their own Central Register and that all such Registers will be interconnected.
2. WHO qualifies as a Beneficial Owner?
A beneficial owner, in the case of corporate entities, is a natural person(s) who ultimately owns or controls a legal entity through direct or indirect ownership of a sufficient percentage of the
• issued shares or
• voting rights or
• ownership interest in that entity, including through bearer shareholdings, or
• through control via other means.
If no person is identified as a beneficial owner, the Company’s Senior Management Officials are entered into the Register.
A shareholding of 25% plus one share or an ownership interest of more than 25% in the Company held by a natural person shall be an indication of direct beneficial ownership. A shareholding of 25% plus one share or an ownership interest of more than 25% in the Company 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), shall be an indication of indirect beneficial ownership.
3. WHAT information is required to be submitted to the Central Register?
The information required to be filed in respect of each beneficial owner is as follows:
- Forename & Surname
- Date of birth
- Personal Public Service Number (PPSN)
- Residential address
- A statement of the nature of the interest held by each beneficial owner (e.g. controlling shareholder)
- A statement of the extent of the interest held by each beneficial owner (e.g. controller of 26% of shares in company)
- The date on which each natural person was entered in the company's own register as a beneficial owner
- The date of cessation as beneficial owner:
- If, having exhausted all possible means, no natural persons are identified as beneficial owners, there shall be entered in the register the names and details of the natural person(s) who hold the position(s) of senior managing official(s) of the company/I&P. Relevant entities shall keep records of the actions taken to identify their beneficial owners.
- Details of the presenter (Gatal Limited) making the entry in the RBO on behalf of the company, i.e. name, contact details and capacity in which they are filing.
4. WHEN to Irish Companies need to act?
The short answer to this question is - Now!
Under the Regulations released by the Department of Finance, the Central Register is expected to be operated and managed by the Companies Registration Office. The Central Register will commence accepting filings from 22 June 2019 and all companies will have up to and including 22 November 2019 to deliver the required information without being in breach of their statutory duty to file. Any new company incorporated after 22 June 2019 will have a five month period from its date of incorporation to submit its first RBO filing to the Central Register.
It should be noted that any changes that occur in information contained in the Register of Beneficial Owners, shall be submitted to the Central Register within 14 days of the change and that the general public will have restricted access to the information on the Central Register. It is expected that subsequent legislation may allow unrestricted public access to the Register.
5. WHERE do I go for further information?
If we have already assisted in the creation of your Beneficial Ownership Register, we can now update it to ensure compliance with the new 2019 Regulations. We can also advise on how to obtain the new information required to be collected by relevant entities and assist in presenting the required returns to the Central Register on your behalf going forward.
Please contact us by e-mail firstname.lastname@example.org, via our website www.gatal.ie or contact your usual Gatal or Moore Stephens contact in Cork or Dublin and we will guide you through the process to ensure your Company continues to remain compliant with its statutory filing obligations.