As previously reported in the Q2 2018 edition of Allen & Overy’s European White Collar Crime Report, the European Fifth Anti-Money Laundering Directive (5MLD) entered into force on 9 July 2018, with an implementation deadline of 10 January 2020 (which may include the UK, depending on the terms of the Brexit transition period).
5MLD imposes additional obligations, particularly on those in the finance sector and aims to, among other things, improve enforcement of Europe’s Fourth Anti-Money Laundering Directive (4MLD) and to ensure tighter controls relating to high-risk third countries. Among the changes introduced by 5MLD is the requirement to provide wider access to each Member State’s central register of beneficial ownership of corporate entities. Under 5MLD, these registers can now be accessed by the general public without the need for them to show a ‘legitimate interest’.
The table below provides an overview of how some Member States are implementing the requirement to maintain UBO Registers in their national law. Please see the following page for a summary of the implementation status of 4MLD.
|
Belgium
|
The Belgian UBO Register went live on 1 October 2018 although the deadline for Belgian companies to upload and complete information on the Register is 31 March 2019.
Members of the public have restricted access to the UBO Register and will have to identify themselves through eID, and may only search the Register using a company’s Crossroads Bank for Enterprises number or company name. Given that companies have until 2019 to update the Register, it seems likely that the Register will be lacking information until this deadline.
|
|
Czech Republic |
The implementation of 5MLD is at an early stage in the Czech Republic but it has been flagged that significant changes to the Czech rules which govern UBOs are to be expected. The rules are likely to become more detailed as they seek to implement 5MLD. |
|
France
|
5MLD is yet to be fully transposed into French law, although a draft bill is currently being considered by the French National Assembly in order to allow the Government to transpose the directive through orders.
In response to the implementation of 4MLD, a new decree entered into force on 21 April 2018 which includes provisions on UBOs. This decree specifies what is meant by a ‘beneficial owner’ – this includes whether the owner owns, directly or indirectly, more than 25% of the capital or votes, or if they have control over the company in a way which allows them to determine decisions in general assemblies of the company.
|
|
Germany
|
5MLD is yet to be implemented in Germany. 4MLD has been effective since 26 June 2017 in Germany and this established the German UBO Register. The requirement under 5MLD that UBO Registers are to be public is still to be satisfied as the current register only grants immediate access to certain authorities and individuals who can show they have a ‘legitimate interest’. |
|
Hungary |
The deadline for the database setup in relation to the implementation of the UBO Register in Hungary is 1 January 2019. Currently, third persons may request data from the central register but this is granted to those with a ‘legitimate interest’ only. |
|
Italy
|
The UBO Register has not yet been implemented in Italy despite 4MLD having been implemented by Decree no. 90/2017. Second-level legislation is required to provide details on how companies’ obligations to disclose their UBOs should be carried out in practice, however, the deadline for issuing second-level legislation expired in July 2018. The implementation of the UBO Register could be postponed until after the implementation of 5MLD. |
|
Luxembourg
|
A series of amendments to the current Anti-Money Laundering Bill were issued in July to reflect the changes 5MLD requires. Currently, the Luxembourg UBO register – the Register of Trust and Fiduciary Contracts – can only be accessed by national authorities. Also, if a person consults the register, their information is kept for five years. The bill which proposes amending the current bill on the Register of Trust and Fiduciary Contracts in line with 5MLD is yet to be voted on and the deadline for this has already been extended from July 2018. At this stage it is difficult to estimate how long the process for the adoption of these bills will take but it is likely to be at least a few more months. |
|
The Netherlands |
Implementation of 5MLD has been put on hold while a new draft bill (set to be published in early 2019) is prepared. The implementation deadline of the UBO Register in the Netherlands has been extended to 18 months post-implementation of 5MLD. |
|
Poland |
The act which implemented 4MLD postponed the implementation of a UBO Register until 13 October 2019 in Poland. The relevant ministry of the Polish Government has confirmed that it has not yet started working on the implementation of the additional requirements of 5MLD. |
|
Romania |
4MLD has not yet been adopted in Romania and the EC has begun infringement procedures in respect of this. The current draft law which would transpose 4MLD into Romanian law does not include provisions which would meet the 5MLD requirements on UBO registers. |
|
Spain |
5MLD has not yet been implemented in Spain although the Spanish Council of Ministers approved Royal Decree 11/2018 in August 2018 on the transposition of a number of directives, which includes the prevention of money laundering. This entered into force on 4 September 2018 and incorporates 4MLD within Spanish law. It requires entities subject to 4MLD to indicate their real owners and to keep a record of this in a marginal note within the relevant Commercial Registry filing. |
