What is the UBO register and what does the ‘feedback obligation’ entail?
In our Wwft client screening, we are obliged to consult the UBO register, to determine whether the client’s UBOs are recorded and, if so, to save an extract of the UBO registration.
If the UBOs are registered in the UBO register, we will see the following information about those UBOs: who are registered as UBOs and their full names, months and years of birth, nationalities, states of residence and the nature and scope of the interests.
If there is a difference between the information registered in the UBO register and the UBO information we ourselves have, we are obliged to report this to the Chamber of Commerce. This is our ‘feedback obligation’ in Wwft services. Our duty of confidentiality is breached by this feedback obligation. If UBO information has not yet been registered, our feedback obligation does not apply.
In 2022, there will also be a trust register, for trusts and similar arrangements (at least for the mutual fund).
What is the UBO register?
The UBO register is a register in which virtually all Dutch legal entities and companies have to register their ‘ultimate beneficial owners’ (UBOs) (see below about when someone is ‘UBO’). The deadline was 27 March 2022. If the registered UBOs change, legal entities and companies must carry out an update in the UBO register within one week. The UBO register is part of the Commercial Register of the Chamber of Commerce. Some data in the UBO register are public (see below).
What is the purpose of the UBO register?
The purpose of the UBO register is to combat financial and economic crime, such as money laundering, corruption, tax evasion, fraud and the financing of terrorism. The idea is that combating this becomes easier if it is clear who the ultimate beneficial owner or owners of a company is or are. In this way, individuals and organisations (such as lawyers and civil-law notaries) are better informed about those with whom they enter or wish to enter into a business relationship.
Who is UBO for the UBO register?
The definition of ‘UBO’ for the UBO register is the same as for our Wwft-UBO investigation (see ‘What is a UBO (or pseudo-UBO)?’).
Who is responsible for registration in the UBO register?
The legal entity or company subject to the registration obligation is itself responsible for the correct and timely listing of all UBOs. The UBOs do have a legal duty to cooperate.
Which organisations must register their UBOs?
Virtually all legal entities and companies in the Netherlands fall within the scope of the UBO register. The obligation to register in the UBO register applies to:
- private limited companies (BVs);
- public companies (NVs) (unlisted);
- foundations (stichtingen) (including Trust Office Foundations (STAKs) and Public Benefit Organisations (PBOs);
- associations (verenigingen) with or without full legal capacity but with an enterprise (owners’ associations (verenigingen van eigenaren) are excluded);
- partnerships (personenvennootschappen) (partnerships (maatschappen), general partnerships (vennootschappen onder firma), limited partnerships (commanditaire vennootschappen));
- mutual insurance associations (onderlinge waarborgmaatschappijen);
- cooperatives (coöperaties);
- European NVs, European CVs, European Economic Interest Groupings which, according to their articles of association, have their registered offices in the Netherlands;
- shipping companies; and
- religious denominations (kerkgennootschappen).
Exempt from the obligation to register in the UBO register are:
- listed public company registered in the Netherlands and direct or indirect 100% subsidiary companies of listed companies registered in the Netherlands (the 100% interest can also be held indirectly);;
- sole proprietorships (eenmanszaken);
- owners’ associations (verenigingen van eigenaren);
- associations without full legal capacity and without an enterprise;
- legal entities governed by public law; and
- other legal entities governed by private law (courtyards (hofjes), guilds, foundations, farmers’ markets).
Foreign legal entities do not have a registration obligation in the Netherlands either, but they may fall under the registration obligation for the UBO register of the country of origin. Like the Wwft, the UBO register is based on European directives, so all Member States of the European Union are obliged to maintain such a register from 2020.
What information is public?
Part of the information about UBOs is public. It concerns the following:
- who are registered as UBOs, and then per UBO:
- first name and surname;
- month and year of birth;
- state of residence; and
- nature and extent of the UBO’s economic importance (indicated in the following ranges: > 25% – 50%, >50% – 75%, >75% – 100%).
What information is not public?
The following information about UBOs is not public and can only be accessed by competent authorities and the Financial Intelligence Unit (FIU):
- citizen service number (BSN)/foreign tax identification number (TIN);
- day of birth;
- country and place of birth;
- residential address;
- copy of valid identity document;
- copies of documents showing the nature and extent of the economic interest.
How is privacy protected?
Not all data is public (see above) and there are data blocking possibilities, but these are limited (see below).
Another measure is that those consulting the UBO register must register and identify themselves before they are allowed to consult the UBO register. This data is stored so that the UBO has the opportunity to ask how often the data have been consulted.
Furthermore, searches can only be conducted in the legal entity’s name and not in the UBO’s name (but FIU‑the Netherlands and the competent authorities are able to do so).
Finally, a fee is charged for consulting the UBO register (€ 2.50).
What data blocking possibilities are there?
The data blocking possibilities are limited. As with the Land Registry, blocking is only possible with:
- guardianship or administration;
- police protection.
What if the obligations for the UBO register are not complied with?
Non-compliance with the obligations for the UBO register can be punished under both administrative and criminal law. This applies to:
- legal entities or companies subject to registration which are involved in non-registration, incorrect or incomplete registration;
- UBOs that have failed to comply with the duty to cooperate; and
- Wwft institutions (lawyers, civil-law notaries, banks, etc) that have not complied with the feedback obligation.