On 21 March 2018, the Spanish Ministry of Justice issued Ministerial Order 319/2018 which requires Spanish non-listed companies to disclose their ultimate beneficial owners ("UBO") to the Companies Registry and keep said information updated. The new UBO reporting measure is motivated by Directive 2015/849 of the European Parliament and of the Council on the prevention of the use of financial system for the purposes of money laundering or terrorist financing (the "Fourth Directive") which imposes an obligation upon the Members States to hold the beneficial ownership information in a central register and make it available with certain restrictions. Paradoxically, Spain has not yet fully implemented the Fourth Directive.
Starting with the financial statements of year 2017 (which shall be filed with the Companies Registry in 2018), all non-listed companies are obliged to file, together with their annual accounts, a declaration form of beneficial ownership of the company. For these purposes, the UBO is defined as the individual who directly or indirectly owns or controls (i) more than 25% of the share capital of the company; or (ii) has more than 25% of the voting rights of the company; or (iii) through other means exercises direct or indirect control of the management of the company. Only listed companies are exempt from the UBO reporting obligation. Additionally, those companies that have an indirect UBO will need to disclose the information on the legal persons that intervene in the chain of control of the Spanish company. If a company does not have a direct or indirect UBO, it needs to identify in the form the members of its management body. In subsequent years this form will only need to be completed if there have been changes in relation to the previously identified. This UBO reporting obligation aims at improving transparency in (very often) complex ownership structures of legal entities.
The companies' beneficial ownership information will be made available to competent authorities (including the Financial Intelligent Units), 'obliged entities' under the Fourth Directive (for the purpose of performing customer due diligence), and any person or organization that has a legitimate interest. This enhanced public scrutiny should prevent the misuse of legal entities and tax evasion.
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