The new notification requirements, based on the Money Laundering Act and EU directives, requires a company or organisation to identify its beneficial owners, notify their information for registration in the Trade Register by 1 July 2020 and keep their details up to date.
The notification requirements apply to most of the companies
The scope of the notification requirement is wide and affects most companies in Finland. For example, all limited companies and cooperatives must notify their beneficial owners to the Trade Register. General partnerships and limited partnerships must file a notification only when the beneficial owner is a person other than a partner. Listed companies, proprietorships, limited liability housing companies and joint stock property companies are not required to make a notification.
Who can be considered as a beneficial owner?
It is the company’s own responsibility to identify the beneficial owners and, the registration authority will not determine the beneficial owners of companies or organisations. A beneficial owner can be considered to be a person who either owns or otherwise exercises control over a business. According to the Money Laundering Act, a person can be considered as a beneficial owner if at least one of the following conditions is met:
- A person owns more than 25 percent of a company shares directly or indirectly through another company.
- A person holds more than 25 percent of the voting rights in the company directly or indirectly through another company.
- A person exercises actual control over the company or organisation on other grounds. Other grounds may refer to a partnership agreement, for example.
The beneficial owner of a company cannot be considered the company itself or, for example, the estate of a deceased person. Only a natural person can be the beneficial owner of a company. The beneficiary information must be notified even if the company is not considered to have a beneficial owner under the Money Laundering Act or in the case that the beneficial owner is not known to the company.
Notification of beneficiary information enhances running errands and increases transparency
Notifying and registering corporate beneficiary information in the Trade Register facilitates the work of banks and should also streamline banking operations. If a company fails to notify and does not provide information on beneficial owners by 1 July 2020 or does not keep the information up to date, there may occur problems with the company’s financing, for example.
By complying with the notification requirement, the company demonstrates that it is acting responsibly.
Briefly:
• Companies must identify their beneficial owners and notify the information to the Trade Register by 1 July 2020. A new notification must be made whenever the beneficiary information changes, or a new company is set up.
• Filing a notification in the Trade Register is free of charge.
• The beneficiary information is not as public as other Trade Register information. The only exception being is the information on the registration of the notification, which is public.
We are happy to provide more information: Markus Myhrberg, partner, tel. +358 40 505 5343, [email protected]
