2021 – The Cyprus UBO Registry to fight money laundering
By: P. Constatninou & Co Ltd
Recently the Government of Cyprus has taken additional steps to increase transparency in all transactions taking place in the country and fight money laundering.
Cyprus aims to increase confidence in its legal and tax system and become a more desired destination for business activity.
In doing so, it decided to implement the central registry of ultimate beneficial owners (UBO) in order to contain detailed information and data on the natural persons who ultimately own or control a legal entity.
The Cyprus Registrar of Companies and Official Receiver will be the responsible authority for maintaining the central register of ultimate beneficial owners (UBO Register) of Cyprus companies and it will be authorized to collect all information about the ultimate beneficial owners and other legal entities through the system that has been developed.
Every company or legal entity incorporated in Cyprus will be required to maintain adequate information on its beneficial owners in the above-mentioned UBO Register. The UBO Register is a system developed to provide transparency, a clear and constantly updated database. The goal is to have a clear and true understanding, on behalf of whom transactions are taking place.
Definition of UBO:
- A physical person who ultimately owns/controls a legal entity with direct or indirect shareholding ownership of 25% plus one share, or,
- Has an ownership interest of more than 25% in the customer on whose behalf a transaction or activity is being conducted.
Access to the information:
As a first step, the information of the UBO Register will be accessible only by the supervisory authorities and regulators, such as the Police, Tax authorities, the Central Bank, the Cyprus Securities and Exchange Commission, and others. The relevant supervisory authorities and regulators will have access to the information if they have a legitimate interest and with the submission of a formal request at the Registrar. Later on, the registry is expected to also be accessible to certain types of professionals who have an interest in completing thorough due diligence as required by the Anti-Money Laundering regulations, such as lawyers, accountants, and bankers. Further on, some data of the database will also be accessible to any member of the public after given permission by the regulators.
All the information of Ultimate Beneficial Ownership will be protected by strict data protection regulations and will only be accessed if deemed appropriate. The data collection is expected to start as early as the 16th of March of 2021.