Within the scope of the so-called Fourth Anti-Money Laundering Directive 2015/849/EC that seeks to prevent money laundering and terrorism, each European Member State is held to introduce a register identifying the ultimate beneficial owner (“UBO”) of corporate entities, trusts and other legal entities and legal arrangements similar to trusts that are established under the laws of a Member State. Such register should have been established prior to 26 June 2017, although a number of Member States is in delay. Each Member State is furthermore permitted to set specific rules and regulations on the disclosure of an UBO and restrict the access to the UBO register.
On 6 December last, the Luxembourg draft bill of law was published regarding the introduction of a central UBO register in Luxembourg (“Bill”).
According to the Bill, the UBO register shall be maintained by the Luxembourg trade and companies’ register (“RCSL”). However, the UBO register shall be separated from the register containing information on companies. Direct (electronic) access to the Luxembourg UBO register shall be fairly limited to Luxembourg national authorities, as well as to professionals that need to comply with laws and regulations on money laundering and terrorism prevention. The applications for information, especially by the non-governmental professionals, shall be closely monitored and traced by the RCSL.
For the wider public (being persons “having a legitimate interest”) a hurdle shall be introduced.
Persons from the wider public - for instance journalists - shall first have to file a formal and motivated request at the RCSL for receiving information from the UBO register. This request should cover only one Luxembourg entity, and should argue the legitimacy of their interest in obtaining the requested information. The RCSL shall pass the request on to a governmental commission, which is to be established by an upcoming grand-ducal regulation. Simultaneously, the RCSL will forward the request to the entity concerned. This entity may (motivated) object against disclosure of the information requested. The governmental commission will then decide on whether to disclose the requested information or not. This decision shall also be disclosed to the concerned entity, which may object against the issued decision.
The Bill explicitly emphasizes the importance of the protection of personal data, based on the EU regulation regarding the protection of natural persons with regard to the processing of personal data.
Next to the presentation of the Bill, the Luxembourg government presented another draft bill of law regarding the introduction of a trust register. This trust register is also based on the Fourth Anti-Money Laundering Directive. The anticipated trust register shall be maintained by the Luxembourg Tax Authorities. Luxembourg trustees are obliged to provide information on the trust to this register. Breach of these obligations may lead to a variety of penalties, from warnings to public statements to monetary fines. Access to this trust register shall be limited to the Luxembourg national authorities.
Further on, the Luxembourg government explained in the media that it has deliberately chosen not to “reveal the curtains” of the registers for the wider public, compared to other EU Member States.
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