Afxentis Zemenides participates in the IR Global Guide – Getting to know the UBO & selecting the right advisor
Foreward by Andrew Chilvers
When the 5th Anti-Money Laundering Directive was introduced into law by the UK and EU in January 2020, for many professionals it was a much needed addition to legislation that would significantly help business transparency and combat money laundering. In essence, it was good for business and for public and professional confidence.
All jurisdictions signing up to the 5th Directive will build and maintain UBO registries that will be publicly available at any time. UBO registries will also be set up for bank accounts and trusts, although these latter two will not be publicly available but be accessed by the relevant authority such as financial intelligence units and legal advisors looking into money laundering. Investigative journalists who can show a legitimate interest in the case can also have access, which is vital if another Panama Papers (see below) is to be uncovered. Across the UK and EU national UBO registers will be set to connect through a central European platform by April 2021.
Please provide a brief overview of the UBO Register in your jurisdiction and its history?
Cyprus has recently proceeded with the full transposition of the 4th European Directive (EU2015/849) of the European Parliament (4th AML Directive) into domestic law and activated the implementation of the Ultimate Beneficial Owner (UBO) Register of Companies and other legal entities in Cyprus.
On 16 December 2020, the Council of Ministers of Cyprus resolved to:
• Appoint the Registrar of Companies (RoC) and Official Receiver of the Ministry of Energy, Trade, and Industry, as the competent authority for the maintenance of the central Register of UBO of companies and other legal entities, and
• Authorise the RoC and Official Receiver to collect information about UBOs of companies and other legal entities through an intermediate system solution that has been developed.
Based on the above decision, the Department of RoC announced that the data collection for companies will begin on Monday 18 January 2021 and from this date all companies will be granted a period of 6 months (until 19 July 2021) for registration of the information about their UBOs such as name, date of birth, nationality, country of residence, ownership, and extent of interest in the company.
However, it is important to note that access to the intermediate system is only available to competent supervisory authorities (e.g., Antimoney Laundering Department, Department of Customs and Excise, Tax Department), upon request to the RoC. Therefore, the UBO information to be entered into the intermediate system shall not be publicly available.
The information collected will then be transferred to the final platform solution to be developed in the second half of 2021 and access to it will be based on the provisions of the 5th European Directive (EU2019/843) of the European Parliament and Council of May 2018, concerning the prevention of money laundering and terrorist financing.
Companies are invited to start collecting the above-mentioned information which they should already have in their files, based on the provisions of the article 61(A) of the Prevention and Combating of Money Laundering and Terrorist Financing Law of 2007, as amended.
The above-mentioned information is also kept by liable entities which provide services to companies under the provisions of Artticles2A(d), 60 and 61 of the above Law in the context of the exercise of due diligence measures and the provisions of the Regulation of Business Services and Related Issues Laws of 2012 to 2020 (i.e. credit institutions, financial institutions, auditors, external accountants, tax advisors, lawyers, trust and corporate services providers, real estate agents, providers of gambling services).