On the 25th November 2022, the Malta Business Registry (“MBR”) announced that it will be limiting access to the register of ultimate beneficial owners (“UBO”) to competent authorities and subject persons only. This decision follows a ruling delivered by the Court of Justice of the European Union (“CJEU”) on the 22nd November 2022.
Under the European Union’s (“EU”) 5th Anti-Money Laundering Directive (“5AMLD”), legal entities are obliged to collect information on the UBOs and submit that information to an external UBO register. A UBO can be defined as the person/s who ultimately owns or controls an entity through either a direct or indirect ownership, having a sufficient percentage of the shares and/or voting rights in that entity. It is further required by the 5AMLD that the information held on the UBO register is accessible in all cases to competent authorities, obliged entities, and any other person or organisation demonstrating a legitimate interest. With regard to the latter, such persons have access to at least the name and surname, date of birth, country of nationality, and percentage of shares and voting rights of the UBOs.
Further amendments to the 5AMLD introduced by Directive 2018/843, made it a requirement that the UBO register is accessible to “any member of the general public”, instead of “any person or organisation that can demonstrate a legitimate interest”.
The requirement for a publicly accessible UBO register was challenged in 2020 in two requests for a preliminary ruling before the CJEU. In the joined cases of the Luxembourg Business Registers vs Sovim SA and WM (C-37/20 and C-601/20) the CJEU stated that the obligation under the 5AMLD to record the identity of the UBOs on a publicly accessible register is invalid. The CJEU’s reasoning behind this is that the general public’s access to information on the UBOs is a serious interference with the fundamental rights to respect for private life and to the protection of personal data under the Charter of Fundamental Rights of the EU, and that such interference “is neither limited to what is strictly necessary nor proportionate to the objective pursued”.
As a result of this ruling, the MBR has limited the general public’s access to the UBO register. Now, subject persons are required to register with the MBR’s portal in order to gain access to it. Additionally, subject persons already registered are required to request access, which request will then be processed by the MBR.
Feel free to contact us for assistance or more information on the above.
