Well begun is half done: Prepare your organisation for the go-live of the UBO register.

The register of ultimate beneficiaries (the "UBO register") will go live on 31 October 2018. In one of our previous newsletters we presented an overview of the general framework of the UBO register. The Royal Decree of 30 July 2018, published in the Belgian Official Journal of 14 September 2018, explains this register in detail. We’ve reviewed what your organisation needs to take into account. 

Is there a notification requirement for your organisation? 
All companies (irrespective of the legal entity type), the (international) non-profit organisations, foundations, trusts, fiduciary companies and similar legal structures must submit the details of their UBOs in the UBO register no later than 31 maart 2019 through an application that will be made available on the 'Myminfin' platform. In other words, partnerships with a non-commercial character are also required to comply. You must update the UBO register of your organisation annually. Interim changes must be communicated within a month. The members of the executive body, the fiduciary manager and the trustee are primarily authorised to complete the UBO register. You must ensure that the details of the directors of your organisation are correctly entered in the Crossroads Bank for Enterprises. In addition, you will also be able to authorise other (external) persons for this purpose on behalf of your organisation. 

Who are the UBOs? 
The principle is that at least 1 UBO can be stated in the UBO register for every entity having a notification requirement. This is why the ultimate beneficiaries ("UBOs") are identified in a stepwise manner. 

For companies:

  • natural persons who hold an 'adequate percentage of voting rights'. The (in)direct ownership of more than 25 percent of the voting rights is an indication of such an adequate percentage. In case of an indirect shareholding, the details of the intermediate companies or other legal entities must also be stated;
  • natural persons who control the company through other channels, for example based on agreements included in a shareholders' agreement.
  • if no UBO can be designated through the aforementioned methods: the natural persons who are members of the senior executive staff. 

For associations and foundations:

  • the members of the board of directors;
  • the persons authorised to represent the (international) non-profit association or foundation, for example through an administrative power of attorney;
  • the persons in charge of the daily management of the (international) non-profit association or foundation;
  • the founders of a foundation;
  • the natural persons or, if these persons have not yet been designated, the category of natural persons in whose main interest the (international) non-profit association or foundation was founded or works;
  • any other natural person who, through other means, exercises ultimate control over the (international) non-profit association or foundation. 

For the trusts, fiduciary companies and similar legal structures:

  • the founder;
  • the fiduciary manager or trustee;
  • the protector (if applicable);
  • the beneficiaries of the fiduciary or the trust, or in case these have not yet been designated, the category of persons in whose main interest the fiduciary or the trust was established or operates;
  • any other natural person who, by virtue of being an (in)direct owner or by any other means, exercises ultimate control over the fiduciary company or the trust. 

Which information must be disclosed? 
In short, you must state the last name, first name, date of birth, address, nationality, the UBO category to which the person concerned belongs, and (for companies) the percentage of his/her stake in the company, or the mandate that the person concerned has within the entity. If the UBO is not the direct owner or beneficiary, but indirectly through one or more legal entities, the identification data (company name, date of incorporation, possible trade name, company number, legal entity type, registered office) of each of the intermediary legal entities must also be disclosed. 

A specific example: You have a company with a dispersed share ownership, where the main shareholder owns a 15% stake. There are no provisions in any shareholders' agreement based on which one or more shareholders can be identified who have control over the company. In that case, your company's UBOs must be sought among senior management staff. One of the directors of your company observes his directorship through his management company. The registration of both the data of the natural person and the management company in the UBO register is required. A lot of information will likely already be in your possession. If this is not the case, it is best to request the missing information as soon as possible from the individuals involved.  

Are there sanctions? 
First of all, the general corporate fine of 400 to 40,000 euros must be taken into account. In addition, specific legislation regarding the UBO register also provides for administrative fines that can vary from 250 to 50,000 euros. These, like the corporate fines, are imposed on the individual directors themselves. 

How long is the reported data stored? 
The UBO register data is retained for up to ten years after the entity with notification duty is dissolved. 

Do you need to inform your UBOs? 
You must inform every UBO in a detailed manner using a durable medium that his or her details have been entered in the UBO register in the context of the notification obligation. This makes sense, given that you also have to respect the regulations regarding the processing of personal data of the UBOs. This obliges each controller (or his representative) and the processors to maintain an internal documentation concerning the processing activities carried out under their responsibility. This is the register of processing operations or the data register, which replaces the former declaration with the Commission for the Protection of Privacy. More information can be found on the Belgian Data Protection Authority’s website. A breach of the requirement to maintain such a data register may result in an administrative fine of up to 10,000,000 euros or, for a company, up to 2% of the total worldwide annual turnover in the previous financial year, if this figure is higher.  

The online application for the UBO register will be available from the 25th of september 2018. You must register with the MyMinFinPro portal or via the website (e-services tab, UBO register). Like with any online application, it is not inconceivable that the system will suffer technical problems due to the high influx of users when the application goes live. To avoid unnecessary frustration, prepare your organisation in a timely manner so that you have identified all UBOs within your organisation before 31 October and have collected all the necessary data. The General Administration of the Treasury was charged with the management and control of the UBO register. It has announced that it will publish a FAQ and user manual on its website before the launch of the application.

The requirement to register gets a broader scope
More entrepreneurs must register with the Crossroads Bank for Enterprises (CBE)
Under the aim of creating a more attractive business climate, changes were made to the existing company law. In that context, the legislator has done away with the ‘trader’ concept, replacing it with the umbrella term ‘enterprise. Besides forming the basis for the rules of the Code of Economic Law, the Judicial Code and the Civil Code, the new enterprise concept also has consequences for reg
More specific: matrimonial property law
A new compensation obligation in the legal system
What if a spouse practices his profession in a company whose shares all form part of his separate property? The Act of 22 July 2018 has introduced considerable changes to matrimonial property law. This article addresses a specific addition to that law, namely the possible disadvantage incurred by the matrimonial property when a spouse practices their profession through their own company1. 
Changes in the cary proxy and usufruct
Estate planning: recent developments
Over the last few months, we have regularly reported on the important changes in estate planning and inheritance planning. Below is an update of some of those changes.   The care proxy: secure your estate for later The classic example is a person who, due to a physical or mental limitation (e.g. coma, dementia), is – temporarily or permanently – unable to manage their assets properly.
Happy Brexmas?
How to prepare your company for Brexit?
On 10 December 2018, the British Prime Minister decided to postpone the vote on the Brexit deal in the House of Commons. The risk of a ‘no deal’ disaster scenario is increasing. What are the important dates? On 29 March 2017, the United Kingdom formally informed the European Council of its intention to leave the EU (according to the procedure provided in Article 50 of the Lisbon Treaty). C
A popular control structure
The all-powerful manager of a civil-law partnership: was it always a fiction?
The civil-law partnership has long been a popular control structure among wealth planners. In many cases, donors do not want to give up their assets entirely, and still want to retain some control over what they donate. Definitely in cases of transfers of family companies, the donors (often parents or family members) still want to retain control over the course of the business.  The advant
The tax framework
Company subsidies: exempted or not?
Various subsidies were briefly described in the article by our colleagues from Strategy and Operations. They explained that they can assist you and your company with guidance on subsidies, from A to Z.1 In this context, we would like to discuss the tax framework for subsidies: how are awarded subsidies treated tax-wise within companies? Are these subsidies exempt from corporation tax and, if
Right to deduct VAT possible for costs incurred during the purchase of shares
The Ryanair ruling
Right to deduct VAT also possible for costs incurred during the purchase of shares, if the purchase ultimately does not (fully) go ahead The European Court of Justice recently confirmed that VAT on costs incurred during the purchase of shares may be deductible even if the purchase ultimately does not (fully) go ahead. As such, the Court of Justice has upheld the principle that the preparatory t
What are the options?
The deduction for investment: an illustration of the options
The deduction for investment allows companies and natural persons who earn profits or benefits to reduce their taxable profits by placing part of the acquisition or investment value of investments in new tangible and intangible fixed assets. Depending on the size of your business and the nature of your activities, you can generally apply the regular, one-off deduction for investment of 20% (tem
Valuation of usufruct
Now also a witch hunt when usufruct is sold?
In previous editions, we have already written about the valuation of usufruct when purchasing property, but recently there have also been regular reports of checks on the valuation of usufruct when reselling. However, up until now, the case law has followed the viewpoint of the taxpayer. Brief description For several years, there has been a lot of controversy regarding the valuation of usufruc
Vlabel is using conciliatory language
Has the decrease in Flemish sales duty led to an increase in the costs for purchases of usufruct?
The decrease in sales duty: also for split purchase usufruct-bare ownership The recent drop in the rate (to 7.00%) for purchases of family homes comes with a number of conditions. For example, the purchaser must be a natural person. Following some uncertainty, it was subsequently confirmed that, in the event of a split purchase of such a property by a company for the usufruct and the bare owner f

Subscribe to our newsletter