New EU anti-money laundering rules that are about to come into law spell trouble for firms that fail to disclose beneficial share ownership in regular company filings.
From this Saturday (22 June 2019) every person with a beneficial ownership of over 25pc in a company will have to be identified in regular company filings.
Failure to comply could result in fines of up to €500,000 or imprisonment for up to 12 months.
That’s according to the new EU Anti-Money Laundering: Beneficial Ownership of Corporate Entities Regulations 2019 that are coming into force in Ireland.
Persons filing company ownership details are also liable for making sure details are accurate. If the major shareholder tries not to identify themselves then the senior management team is also liable.
“In other words, there’s no hiding place. Failure to comply could result in €500,000 fines or a year in jail. This is a major change for every businesses, big and small, in Ireland,” said Conor Sweeney, managing director of CLS Chartered Secretaries who spoke at the recent Institute of Chartered Secretaries annual conference in May.
The new regulations require corporate or other legal entities incorporated in Ireland to obtain and hold adequate information in respect of beneficial owners and state the nature and extent of control they exercise.
“This is a major change for every businesses, big and small, in Ireland.”
The new regulations establish a central register of beneficial ownership and require corporate or other legal entities incorporated in the State to obtain to transmit its beneficial ownership information to the central register.
“If the requirement to obtain a PPS number for every beneficial owner is required this could prove problematic for foreign beneficial owners and how quick these will be issued by Revenue,” Sweeney pointed out.
“Firms who are considering assisting companies comply as a service to their clients should be aware of the responsibilities as presenters under the regulations including the offences. Also the information on the central register will not be pre-filled and will have to be manually entered into the system for each company.”
Written by John Kennedy
Published: 20 June, 2019
John Kennedy is an award-winning business and technology journalist and is Editor of ThinkBusiness.ie