Companies, non-profit associations and foundations must submit data regarding their beneficial owners by next Tuesday, 30 October.
“Increased transparency of the business environment certainly benefits the whole of Estonian economy. Information regarding beneficial owners enables to determine persons who are ultimately in control of companies in Estonia, as well as in cases where the chain of ownership extends beyond Estonia. This information has not been available until now,” said Taivo Põrk, lawyer at the Entrepreneurship and Accounting Policy Department of the Ministry of Finance. “Use of undercover agents and complex corporate structures for concealing actual ownership is becoming more risky. This is beneficial for honest entrepreneurs as well as the state.”
Data regarding beneficial owners shall be submitted by all legal persons in the European Union, pursuant to the fourth Anti-Money Laundering Directive of the European Union.
The deadline for the submission of data concerning beneficial owners is 30 October; however, the submission option shall remain open indefinitely. Data can be submitted via the Company Registration Portal of the Business Register, where pre-filled data on beneficial owners is available for most associations. Pre-filled data can be supplemented (e.g. the manner of exercising control can be added) and then confirmed, as well as entered and added independently. Data can also be submitted via a notary.
The data may be submitted electronically through the Company Registration Portal at: https://ettevotjaportaal.rik.ee/
A guide for the submission of data on beneficial owners is available at: http://abiinfo.rik.ee/beneficialowner
A more detailed guide on determining beneficial owners and answers to frequently asked questions are available at: https://www.rahandusministeerium.ee/sites/default/files/tegelike-kasusaajate-andmete-esitamise-juhis-en.doc (DOC)
The Ministry of Finance shall update the guide, if necessary.
A total of approximately 218,000 associations must submit their data on beneficial owners, including approximately 186,000 private limited companies and 22,000 non-profit associations. 88,682 associations had submitted their data on beneficial owners as of 23 October. Data regarding a total of 137,053 beneficial owners has been submitted.
The Company Registration Portal shall send reminder notices for members of the management boards whose affiliate associations have failed to respect their obligations.
In the case of companies, a beneficial owner is the natural person who ultimately owns or controls a legal person through direct or indirect ownership of a sufficient percentage of the shares or voting rights or ownership interest in that person, including through bearer shareholdings, or through control via other means. In regard to companies, data must be submitted on persons who either directly or indirectly through other companies control a shareholding of 25 percent plus one share or holding.
The beneficial owners of a non-profit association are considered persons who control the activity of the association. These are generally members of the management board. If a person is marked a beneficial owner due to their position as a member of the management body, this person shall not be regarded to receive monetary benefits from the association nor shall the association be considered to operate in their personal interest.
According to article 77 of the Money Laundering and Terrorist Financing Prevention Act, general partnerships, limited partnerships, private limited companies, public limited companies, commercial associations and non-profit associations are required to submit the following data regarding their beneficial owners via the information system of the Business Register: 1) the person’s name, personal identification code and the country of the personal identification code (upon absence of a personal identification code, the date and place of birth), and the country of residence; 2) manner of exercising control, i.e. how the beneficial owner controls the association (direct ownership, indirect ownership or member of the management body).
Foundations must also additionally submit a list of beneficiaries, to whom payments can be made from the assets of the foundation on the basis of the articles of association of the foundation. The list must contain each beneficiary’s name, personal identification code (with reference to a country), or the date and place of birth, and the country of residence, where such persons have been specified in the articles of association of the foundation.
Data regarding beneficial owners is not required from apartment associations, building associations or foundations, the purpose of whose economic activities is the keeping or accumulating of the property of the beneficiaries or the circle of beneficiaries specified in the articles of association and who have no other economic activities.
If data changes in the future, the management of the association shall submit the renewed data to the register within 30 days. In the case data has not changed, the correctness of the data shall be certified upon submission of the annual report by the association.