What Charities Need to Know About the Register of Beneficial Ownership

What is Beneficial Ownership?

The EU Anti Money Laundering (AML) Beneficial Ownership of corporate entities Regulations 2016 came into force in November 2016 and obliged all relevant entities to obtain and hold information on their beneficial owners and to enter that information onto an internal beneficial ownership register which it must keep and maintain.

This obligation to keep and maintain an internal beneficial ownership register is a live and current legal obligation.

There are also new AML Regulations, (called the European Union (Anti-Money Laundering: Beneficial Ownership of Corporate Entities) Regulations 2019) which establish a Central Register. In addition to keeping the internal beneficial ownership register, charities which are companies will now need to file their beneficial ownership information in the Central Register.

Part 3 of the new regulations came into force on 22 June 2019 and commenced the process of establishing the Central Register (though there has been a delay in opening the online filing process itself). The Central Register is being administered in Ireland by the Companies Registration Office under a separate registrar called the Registrar of Beneficial Ownership (RBO).

Why is this relevant to charities?

The new regulations apply to companies and any charities that are registered as companies with the Companies Registration Office must comply with the regulations. Most charities which are companies are companies limited by guarantee (CLGs) but there may be other company formats used by charities – in any event, the regulations apply to all companies (with very limited exceptions).

What is a beneficial owner? 

A beneficial owner is any natural person who owns or controls (directly or indirectly) 25% or more of the shares or voting rights in a company, or controls the company by other means.

As CLG’s don’t have shares, typically the members must be considered for voting rights and control.

If the directors of a company cannot identify a beneficial owner, the new regulations require companies to enter the details of their “Senior Managing Officials” on the Central Register.

In the case of most charities who do not have shares and who have more than 4 members, the Regulations generally require such companies to maintain the details of their Senior Managing Officials who are deemed to be the persons who exercise control.

Although this may vary depending on the circumstances of each charity, in most cases, the Senior Managing Officials will comprise the Board of Directors and the CEO, whose details then need to be maintained on an internal register and filed on the public register.

What details need to be maintained and filed?

The following details need to be maintained and filed:

Name – Date of Birth – Address – Nationality – Country of Residence - Statement of the nature & extent of interest held and control exercised – Date of entry and cessation of beneficial owner.

Also for the purposes of filing on the Central Register, the PPS number of each individual is required. *

*The PPS number is only used for verification by the RBO, it will not be held by the RBO or accessible by any third party

What will the information be used for and what information will be available to the public?

The information will be made available to a range of statutory authorities, such as the Gardaí, should such authorities need to find out who is the beneficial owner of a company.

The only information available to the public will be the name, month and year of birth, nationality, country of residence, and a statement of the nature and extent of the beneficial interest held or control exercised. Searches will only be done ‘company by company’ i.e. by typing in a person’s name, all companies with which they are connected will not be obtainable.

When does the public register open? 

The register (www.rbo.gov.ie) was due to open on 22 June but has been postponed temporarily. There is a 5-month window from the date of opening to file the necessary information.

Queries

If you have any queries please contact our Director of Finance, Tony Ward – tony@wheel.ie

The Wheel was delighted to partner with Mason Hayes and Curran on a recent event on this topic.

You will find a video from the event here and the slides from the event here.

Visit their website for specific advice for charities from Mason Hayes and Curran.