Update on the Implementation of the UBO Register in Cyprus

Background summary

In December 2020, Cyprus officially activated the so-called UBO Register regime which formed an integral part of the requirements under the 5th EU Anti-Money Laundering Directive (AMLD) as enacted into law in Cyprus (the Law).

The central registry of ultimate beneficial owners (the “UBO Register”) will contain detailed information on the natural persons who ultimately own or control a legal entity. The Registrar of Companies and Official Receiver (the “ROC”) was appointed as the competent authority for maintaining the UBO Register.

The ROC had originally announced that the date that the information collection shall commence would be the 18  January 2021, later postponed until 12 March 2021 (but see further below regarding the period of the Interim Solution).

Latest announcements & clarifications

Under the Law, it is the legal obligation and responsibility of the Company’s Officers (Directors & Secretary) to ensure that the information relating to it’s UBO(s) is obtained and submitted to the UBO Register in a timely fashion.

The period from 12/3/2021 until such time that the law will become fully enforced and implemented, (currently expected to be 16/3/2022), is referred to as period of the interim solution. During the period of the interim solution, no penalties will be imposed for non-compliance.

Deadlines for submission of information

• Companies formed after 12/3/2021 should submit information within 30 days of formation
• Companies formed before 12/3/2021 the deadline for submission has been extended to 16/3/2022
• Changes in details of UBO’s need to be submitted within 14 days from the date of change.
• Companies will need to confirm the UBO details already entered between 1/12 to 31/12 every year.

Interim Solution & Access to Information

The  current system that has been developed by the RoC is an interim solution and access to it is currently only permissible to competent authorities upon submission of a formal request to the ROC. (Competent Supervisory Authorities, the Financial Intelligence Unit (FIUs), the Customs Department, the Tax Department and the Police, without any restriction and upon submitting a written request to the Registrar of Companies.)

The information collected will be transferred into a final system solution expected to be accessible to the general public and to be developed in the second half of 2021 and access to it will be based on the provisions of the EU 4th AML Directive.

Submission of data via Ariadne System

Each Company is obliged to be registered with the Ariadne system. This involves the creation of a Company Profile and requires a unique specific email address.

Access to the Company Profile of the system is strictly protected. This means that communication with the competent authority (the RoC) is made directly to the Company itself via its own specific email address (no other email address of another individual, director or representative is allowed).

As from 29 October 2021 it is now possible for the officials of the Company (ie Directors or Secretary) to also submit the information on behalf of the Company.

Clarification on definition of UBO

As per the recent announcements by the ROC, it is clarified that information should be provided for all UBOs,  defined as follows:

(a) in the case of corporate entities, the UBO is defined as:

i. the natural person who ultimately owns or controls a corporate entity through direct or indirect ownership of a sufficient percentage of the shares or voting rights or ownership interest in that corporate entity. (An indication of direct shareholding is 25% plus one share)

ii. if after exhausting all possible means no other person is identified or if there is doubt that the person identified is the beneficial owner, the natural person who holds the position of senior managing official.

(b) in the case of trusts, the UBO is defined as:

The settlor, the trustee, the protector (if any) the beneficiary or class of persons in whose main interest the legal arrangement or entity is set up or operates, and any other natural person exercising ultimate  control over the trust by means of direct or indirect ownership or by other means.

Note : see further below the information disclosed to the UBO Register where UBO is a registered trust

What information should be included in the UBO Register

As a minimum, the following information must be kept up to date and communicated for each UBO:

•             name

•             date of birth

•             nationality

•             address

•             nature and size of interest

•             when she/he became a UBO

Note : Where the shares are held by a registered Trust, at this stage it is necessary to  provide only the Trust’s Registration Number  and country – no further information is  required for the Register of UBOs.

However a separate register for Cyprus Trusts will be introduced, which will require the following information to be  disclosed:

•             the settlor

•             the trustee(s)

•             the protector, if any

•             the beneficiary or class of beneficiaries

•             information on any other person exercising control over the trust

(The Trust Register will be supervised and maintained by the Cyprus Securities and Exchange Commission (the “CySEC”)).

How we can help you

Our team of experienced and qualified professionals can assist you to determine whether your business is subject to the regulations in Cyprus and ensure that the relevant requirements are met. Our in-house specialist team working closely with other experts across our international network of firms and other associates can assist with the preparation of TP documentation files as required.

For more information on how we may be able to assist you and your business please contact us at  uhy@uhy.com or call (00357) 22379210.