Cyprus: Anti-Money Laundering Directive comes into practice in Cyprus
Central Register for Ultimate Beneficial Owners
The 4th Anti-Money Laundering Directive requires all member-states to maintain a register of Ultimate Beneficial Owners (UBO), which will be centrally held. The said Directive has been transposed into Cyprus’ jurisdiction by Law 13(I)/2018.
The purpose of the UBO Register is to provide transparency and a properly updated database, where every company, or any other legal entity, which has been incorporated in Cyprus, shall be required to maintain adequate information on its beneficial owner, according to s.61(a) of Law 188(I)/2007 as amended. The Law does not explicitly refer to the information that should be entered in the Register. However, in general, companies should provide adequate, accurate and updated information on the beneficial ownership of the company.
The Law defines an UBO as a natural person who has ultimate control of the company. This is further explained as: a natural person who ultimately owns or controls 25% plus one share; or an ownership interest of more than 25% in the customer in a company.
The Register will be maintained centrally by the Registrar of Companies and Official Receiver of the Ministry of Energy, Trade and Industry, according to a Council of Ministers decision, and will be accessible by the competent regulators/supervisory authorities (including the Cyprus Bar Association, the Central Bank of Cyprus, the Cyprus Securities and Exchange Commission). In addition, the police, the customs and tax departments, as well as the Unit for Combatting Money Laundering and Terrorist Financing (MOKAS) are eligible to have access to the information of the Register. Any person or organisation who can prove a legitimate interest, providing for this sufficient evidence, as it will be defined in the relevant Regulations (which are expected to be drafted soon), can file an application to the Registrar of Companies, and provided this is approved, shall have access to the name, month and year of birth, nationality and country of residence of the UBO, and also to the type of rights he/she holds. The Law subjects the function and access to the central Register to the provisions of the General Data Protection Regulation as it has been transposed in the national legislation.
The commencement of providing the relevant information to the Registrar of Companies has been set for 22 February 2021. However, it should be noted that this is not compulsory until the relevant Regulations are issued.
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