11th December 2017
The new German Anti-Money Laundering Act (“Geldwäschegesetz” or “GwG”) came into force on 26 June 2017. According to the new law, legal entities governed by private law must obtain, hold, update and submit information about their beneficial owners to the German transparency register without delay. Helmut Taubert, legal partner at MSI’s German multi-disciplinary member firm ADKL, provides further insight into the new obligations and reporting requirements related to the German transparency register.
The obligation to notify the transparency register applies to all legal entities governed by private law as well as to registered partnerships (section 20(1) GwG). This includes all corporations (“AG”, “SE” and “GmbH” or “UG”), commercial partnerships (“OHG”, “KG”, “Partnerschaften”) as well as foundations with legal capacity, associations, cooperatives and professional partnerships. The notification obligation also applies to administrators of trust, the trustee of foundations without legal capacity, whose purpose is a vested interest, as well as trustees of similar structures (section 21 GwG) provided that the administrator’s or trustee’s residence or registered office is in Germany. Civil law partnerships pursuant to the German Civil Code (“GbR”) are not affected by the new law. The exception does not apply as far as the “GbR” is the shareholder of a legal entity, especially a “GmbH”. In this case and according to section 40(1) of the German Limited Liability Companies Act (“GmbHG”), the shareholder of the “GbR” will have to be named in the shareholders´ list of the “GmbH”.
Who is a beneficial owner?
“Beneficial owner” is a key term with regard to the transparency register (also see section 3 GwG). A beneficial owner is (1.) a natural person that is the owner or who is in control of the organisation, or (2.) a natural person, who is in a position to grant permission to make financial transactions or constitute new partnerships (sections 19(2), 3(1)(2) GwG).
In case of a legal person or other companies, a natural person may be beneficial owner if it (1.) directly or indirectly holds more than 25% of the share capital, or (2.) controls more than 25% of the voting rights, or (3.) controls the firm in a comparable way.
If no natural person has been appointed as the beneficiary, then the group of natural persons in whose favor the assets are being managed or distributed is deemed to be the beneficial owner (section 3(3) GwG).
What kind of information must be submitted to the transparency register?
Notably the following details about the beneficial owner have to be submitted to the transparency register:
The details on the type and extent of the economic interest have to clearly indicate the cause of the beneficial owner’s control, for example the level of shares or voting rights, the role as statutory representative, managing director, partner or beneficiary, or the extent to which control is exercised in some other way (section 19(3) GwG).
Read the full article on: The new electronic transparency register in Germany
ADKL is an interdisciplinary partnership of experienced and entrepreneurial frame of mind certified auditors, lawyers and tax consultants. We consult numerous national and international companies and entrepreneurs with complex economic, legal and tax issues.
View firm profile
Our new 'Doing Business in Malaysia' guide is now available for download from our website. View the MSI Global Alli… https://t.co/TspMLCfvbF
Europeans rather than Americans are most-diverse companies https://t.co/FcZ8WZFbXS #diversity
The Law Society of England and Wales has backed a new free online education resource aimed at future #lawyers https://t.co/mg0me9aa6P