On 27th September 2020 the Netherlands has introduced new regulations regarding the Ultimate Beneficiary Owner. The regulations are a required change due to new EU regulations related to anti tax avoidance and corporate transparency.
Currently, the systems of the company registrar are being adjusted to make the change regarding the UBO register possible.
As a consequence the company incorporation can have a delay of several working days. Unfortunately, this delay is nationwide and likely affects all notaries and new BV incorporations. As far as ICS is aware, all notaries are negatively affected by this change.
What is an UBO?
A UBO is an ‘Ultimate Beneficiary Owner’, meaning: The person that is actually in control, ownership or in a position of authority over the company. The UBO can be qualified as follows:
- A person with more than 25% of the shares of the company
- A person with more than 25% of the voting rights of the company
- A person who is (actually) controlling the company (even if not owing any shares
The last criteria is meant to include scenarios in which a person has control without having any of the shares. Think of a business investor that has provided financing to the company, but under strict conditions that important decisions will be only made with the approval of this investor.
Another example could be in the scenario of a nominee shareholder. A nominee shareholder is often seen in offshore tax havens, in which a lawyer or company agent holds the shares for the client (the ‘actual’ owner). The Dutch legislation does not allow such type of nominee structures.
What is the goal of the new legislation
Under the new legislation, it is a requirement to have public insight in the share structures and control of companies. The ultimate goal is to combat tax avoidance, fraude, money laundering and corruption.
Which companies are required to register under the new UBO registration?
- All public (NV) and private limited companies (BV) that are not publically traded
- All other Foundations, Cooperations and other private entities
With the exemption of
- Stock listed companies
- Sole traders / one man businesses
- Public companies
The data that will be ‘public’ or can be requested is as follows
- The first and last name
- The birth year and month
- State of residence
- Nature and % of the economic interest of the UBO
The public part of the UBO register is only searchable on the name of the company. It is not possible to search the UBO register by name of the person. Requesting data from the register will cost money.
The UBO register will make sure to follow the guidelines of the GDPR European data protection act as well as the more strict Dutch General Data protection act.