The European Union (Anti-Money Laundering: Beneficial Ownership of Corporate Entities) Regulations 2019 (the “2019 Regulations”) were signed on 22 March 2019.
The following are the key features of the rules which introduce a number of significant new requirements to the regime that has been in place since November 2016. A more detailed analysis of the 2019 Regulations will be published shortly.
The 2019 Regulations:
- Require corporate entities incorporated in Ireland (apart from listed companies subject to transparency rules), including ICAVs and Industrial and Provident Societies (a “relevant entity“) to obtain and hold information in respect of their beneficial owners, including the nature and extent of the control exercised by those beneficial owners. This information must be kept on an internal beneficial ownership register. There is now a requirement to obtain the PPS numbers of beneficial owners, where available. Where a beneficial owner does not exist or cannot be identified, the details of the “senior managing officials” of the relevant entity must instead be entered on the internal register. These rules apply from 22 March 2019.
- Require relevant entities to provide beneficial ownership information on request to certain authorities (including the Revenue Commissioners, the Gardaí, State competent authorities etc.). It must also be provided to “designated persons” (as defined in anti-money laundering legislation) when entering into a business relationship, or carrying out certain one-off transactions. This is a new requirement and comes into effect from 22 March 2019.
- Establish a Central Register of Beneficial Ownership of Companies and Industrial and Provident Societies (the “Central Register“) and require relevant entities to transmit beneficial ownership information to the Central Register. This is a new requirement. The Central Register will start accepting filings from 22 June 2019 and existing relevant entities will have a further 5 months from this date (i.e. until 22 November 2019) to submit their beneficial ownership information to the Central Register. Relevant entities incorporated after 22 June 2019 will have 5 months from the date of incorporation to make the required filings.
- Establish who will have access to the information held in the Central Register. The important point here is that most of the information on the Central Register will be accessible to the general public.
- Provide for the reporting by competent authorities and “designated persons” of discrepancies on the Central Register.
- Create offences for breaches of the rules. There is the possibility of conviction on indictment and a €500,000 fine for certain breaches now, representing a significant increase from the maximum fine of €5,000 under the 2016 Regulations.
What do I need to do now?
- If your relevant entity does not already have an internal beneficial ownership register, you must take steps to establish one.
- If your relevant entity already has an internal beneficial ownership register, ensure that it is up to date. Be aware of the requirement to now gather the PPS numbers of beneficial owners.
- Be aware of the requirement to allow competent authorities to have access to the internal register on request.
- Consider whether beneficial ownership information needs to be disclosed to designated persons when entering into business relationships.
- Be in a position to submit all beneficial ownership information to the new Central Register by 22 November 2019 at the latest.
Contributed by: Aoife Kavanagh
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