The Law of 13 January 2019 setting up a register of beneficial owners of companies (the “Law”) was published on 15 January 2019 in the Official Gazette (“Memorial”). One can now contentedly stress that almost all of the outstanding obligations of the 4th anti-money laundering Directive have been implemented into Luxembourg law. Still, a forthcoming Law establishing a register of trusts remains to be finalised (currently taking the form of draft Law N°7216B). Most importantly, a long and winding way awaits both the Luxembourg legislator and the financial stakeholders in taking on board all of the novelties introduced by the 5th anti-money laundering Directive.
The Law creates a register of beneficial owners (“BOs”) of corporate and legal entities (the “registered entities”) including for instance public/private limited companies, partnerships, not for profit associations, foundations and civil companies together with Luxembourg branches of foreign companies and UCITS. The BO is any natural person who ultimately owns or controls a legal entity through direct or indirect ownership of a sufficient percentage of the shares or voting rights or ownership interest in that entity, or through control via other means. Alternatively, if such person cannot be identified and under specific circumstances, the BO shall be the individual holding the position of senior manager.
The registered entities will hence have to make available specific information on their own BOs in a dedicated registry (the “Registre des Bénéficiaires Effectifs”, a.k.a. “RBE”). The RBE will be managed by the Luxembourg Business Registers.
The obligation to report BOs may also rest with the agents (“mandataires”) of the registered entities, a term that the Law unfortunately does not define. Accordingly and depending on the situation at stake and the registered entities involved, an agent could for instance encompass a legal representative, a business entity domiciling a company, a transfer agent or a director/manager of a registered entity.
The electronic modalities of transmission/update of the information to be transmitted to the RBE as well as the costs and required supporting documentation engaged should be detailed in a forthcoming Grand-Ducal Regulation.
As to who will be able to access the information of the RBE, it is worth mentioning that the National authorities, within the ambit of their missions, will have an unlimited access to the information stored in the RBE while any person (i.e. the public at large), including the financial stakeholders, will be able to get into a limited set of information, occluding for the latter some data required for due diligence purposes under CSSF Regulation N°12-02.
The Law will enter into force on 1 March 2019. Registered entities will have a delay of six months to abide to the provisions of the Law, thus apply its rules and proceed to the listing of their beneficial owners within the RBE by 1 September 2019.
By Catherine Bourin, Member of the ABBL Management Board