UBO register bill
Dutch entities need to complete the registration of their UBOs (ultimate beneficial owners) with the Dutch Trade Register by 27 March 2022. Due to the current backlog with the Dutch Trade Register and delays in the registrations, we recommend you take action as soon as possible.
Who are the UBOs?
An UBO is generally defined as an individual with ultimate ownership or control over an entity. An entity can have more than one UBO. It was determined that the following individuals qualify as UBOs:
- BVs, NVs, SEs and SCEs: individuals who ultimately own or control the entity (i) through direct or indirect ownership of more than 25% of the shares, voting rights or ownership interests or (ii) by other means, such as the right to appoint or dismiss the majority of the members of the entity's administrative, management or supervisory body;
- foundations, associations, cooperatives, mutual insurance associations, EESVs, partnerships and shipping companies: individuals who ultimately own or control the entity through (i) a direct or indirect ownership interest of more than 25%, (ii) the ability to directly or indirectly exercise more than 25% of the voting rights in relation to an amendment of the entity's articles of association or constitutional agreement or (iii) the ability to exercise effective control over the entity.
The above is not an exhaustive list of the criteria used to identify the UBO. An individual can also qualify as an UBO without meeting the abovementioned criteria, e.g. if there is a contractual right to appoint or dismiss managing directors.
If, after using all possible resources, no UBO can be identified on the basis of the ownership and/or control criteria or if there is any doubt whether the identified individuals are in fact the UBOs, the entity must register one or more "pseudo UBOs". In that case the individuals who hold the position of senior managing officials will be deemed to be the UBOs and will be registered as such in the UBO register. In case of legal entities, the pseudo UBOs will be the managing directors and in case of partnerships the pseudo UBOs will be the partners (excluding limited partners).
Exceptions
Listed entities that are subject to the disclosure requirements laid down in the EU Transparency Directive or equivalent international disclosure requirements, and their (in)direct wholly owned subsidiaries do not have to identify and register their (pseudo) UBOs in the Netherlands.
Non-Dutch entities having a branch office in the Netherlands do not have to register their UBO in the Dutch UBO register.
Consequences of non-compliance
Not complying with the obligation to (timely) register an UBO and/or to register the relevant and correct information may result in an administrative or criminal sanction for the relevant entity, its managing director(s) and/or the UBO.
Internal register
In addition to the obligation to register its UBOs with the Dutch Trade Register, each entity must also keep a register with a) adequate, accurate and up-to-date records of the UBO information or b) evidence that an exemption to the UBO registration applies. The exception for listed companies and its (in)direct wholly owned subsidiaries, will thus not relieve the board of directors of these entities keeping the internal UBO register.
What should you do now?
If you need to register your (pseudo) UBOs and have not already done so: Collect the necessary UBO information in order to prepare for registration in the UBO register. Having a complete and updated set of UBO records will also be useful in connection with any client due diligence requests, e.g. by banks, auditors and law firms.
We can help you identify the (pseudo) UBOs, assess which companies are exempt, provide you with an overview of information and documents needed for the registrations and assist with the registration of UBO information in the Dutch Trade Register. We are also happy to assist in compiling the internal UBO register.
Authored by Chantalle Schoegje.
