Introduction of UBO register in the Netherlands
The introduction of the UBO (ultimate beneficial owner) register was scheduled for 10 January 2020. It has been postponed until spring as the bills are still being debated in the Senate. Nonetheless, the mandatory registration of organisation UBO's with the Dutch Chamber of Commerce is near.
The UBO register is a result of European legislation. The European Union hopes this register will prevent the use of the financial system for money-laundering and terrorism financing. It is supposed to provide transparency and prevent fraudulent practices.
Who is UBO?
UBO means 'ultimate beneficial owner'. A UBO is an individual with a direct or indirect interest, (benefit) entitlement or decision-making power of more than 25%.
You are required to register at least one UBO. Does your entity not include a true UBO? In that case, your organisation needs to register a higher management employee as pseudo UBO. This will probably be a director (under the articles of association) or partner.
Which organisations are required to register a UBO?
This obligation applies at least to:
- unlisted private and public limited companies
- foundations under Dutch law
- with full legal capacity
- with limited legal capacity, but with enterprise
- mutual insurance associations
- cooperative associations
- partnerships: professional partnerships, commercial partnerships and limited partnerships
- European public limited companies
- European cooperative companies
- European economic interest groupings with a registered office in the Netherlands, according to their articles of association
- Shipping companies
Foreign legal entities, such as an Ltd or GmbH with branch offices in the Netherlands, are excluded from the Dutch registration obligation and need to be registered in their country of incorporation.
The UBO register does not apply to trusts and legal entities considered equivalent to trusts. A separate bill has been announced for these entities.
Data registration and privacy
The UBO register will hold data on the UBO, including the nature and scope (in percent) of the UBO's interest. It will comply with data protection requirements and the General Data Protection Regulation (GDPR). To ensure privacy and safety of the UBO, access to the register will only be granted to people who have identified themselves in advance. The ultimate beneficial owners themselves can always check how often their data has been accessed in the register. Additionally, the relevant authorities will be allowed to review who has accessed the information on the ultimate beneficial owners.
Registration and period
UBO registration will take place through the Dutch Chamber of Commerce. Entities that are already in existence when the registration obligation takes effect (spring 2020) need to register their UBO within eighteen months (autumn 2021). Entities that are organised or incorporated after the registration obligation takes effect, need to register the UBO immediately. They are not allowed to postpone registration until autumn 2021.
Would you like more information about UBO registration? Our specialist will gladly assist you. You can contact Vincent Wanningen, senior taxspecialist at ABAB International, on 013-4647209 or e-mail Vincent.