On 13 October 2019, the Central Register of Beneficial Owners (CRBR) was launched: a system collecting information on the beneficial owners of companies and partnerships. The register implements the European Parliament and Council Directive on preventing the use of the financial system for money laundering or terrorist financing. What does this mean in practice?
Who is a beneficial owner?
The Central Register of Beneficial Owners contains information on beneficial owners. In general, these are the natural person or persons who actually control a company or partnership. They include those exercising direct or indirect control through rights arising from legal or factual circumstances that enable them to exert decisive influence over the entity’s actions or activities. They also include persons on whose behalf a business relationship is established or an occasional transaction carried out.
Presumptions when identifying beneficial owners
Identifying the beneficial owner requires examining both direct and indirect control. For companies subject to the statutory test, relevant factors include holdings or voting rights exceeding 25% and other rights enabling control to be exercised. The beneficial owner is a natural person, not a parent company. In a multi-tier structure, the analysis should not stop at the name of the entity holding the shares.
Identifying a senior managing official is a fallback solution subject to the conditions in the AML Act. It requires documenting the inability to identify beneficial owners, or doubts about their identity, under the preceding criteria, and the absence of suspicions of money laundering or terrorist financing. It is not an optional shortcut in place of analysing the ownership and control structure.
What does the CRBR contain?
The reporting obligation now covers a wider range of entities than when the CRBR was launched. These include Polish registered partnerships, professional partnerships, limited partnerships, partnerships limited by shares, limited liability companies, simple joint-stock companies and non-public joint-stock companies, as well as foundations, associations entered in the KRS, cooperatives and other entities listed in Article 58 of the AML Act. Special rules apply to trusts. The information to be reported and the persons authorised to file must be determined for the relevant organisational form.
Why have this register?
The CRBR was established to combat money laundering and terrorism. It implements Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on preventing the use of the financial system for money laundering or terrorist financing, known as the Fourth AML Directive. Its legal basis is the Act of 1 March 2018 on Counteracting Money Laundering and Terrorist Financing (Journal of Laws 2019, item 1115, as amended). That Act therefore implements the AML Directive. We previously discussed these provisions in two articles: Money laundering risk assessment: more businesses subject to the obligation and Money laundering risk assessment: new obligations, higher penalties.
How is a beneficial owner reported?
Beneficial owners are reported electronically through the register’s website: https://www.podatki.gov.pl/crbr/. As well as making filings, the website allows users to search for beneficial owners and check the status of a submission, among other functions.
Filing deadline
For entities entered in the KRS, the filing deadline is generally 14 days from registration, with updates due within 14 days of a change in the information. The AML Act’s special rules apply when calculating the deadline. The historical seven-day deadline and the initial filing deadlines from 2020 should not be used as guidance for current compliance. Failure to file or update information may result in an administrative fine of up to PLN 1,000,000.
