Ultimate beneficial owner

What it means

The ultimate beneficial owner is the natural person who really controls the company or benefits from it - directly or through a chain of other companies. The law defines it by share of voting rights, of profit, or by other factual control.

Where no such person can be identified, the members of the statutory body are treated as the beneficial owners. It is not a field that may be left empty.

The beneficial owner need not hold a business share in their own name. A company can be controlled through other companies, by contract, or through a person who holds the share only formally. A company may also have several beneficial owners at once, and each of them has to be listed, not only the one with the most influence.

How it works in practice

The data is entered in the non-public part of the commercial register, and separately in the register of public sector partners where the company receives public money. A change in ownership has to be reflected here too, not only in the list of members.

Banks and accounting firms establish it as part of KYC and AML duties. The ownership chain has to be evidenced down to natural persons, not just to the parent company.

When we take on a new client we ask for a chart of the ownership structure and documents for each natural person at the end of it. With a foreign parent this includes an extract from the local register, in some cases with an apostille. We then keep the data up to date, because the duty to know the client does not end when the contract is signed.

What to watch out for

An unregistered or outdated entry is grounds for a fine, and for a public sector partner for graver consequences including sanctions against the statutory representative. With foreign owners, sanctions screening examines the same ownership chain just as deeply.

Conflicting registers are a problem as well. If the commercial register names a different person from the register of public sector partners or from the data given to the bank, it looks like an attempt to hide something, even when it is just a forgotten update. The bank may then put opening an account or granting a loan on hold until the discrepancy is explained.