Cyprus incorporated in its domestic legislation the provisions of the 5th Anti-Money Laundering EU Directive 2018/843 on the 23rd of February 2021. This was implemented by amending the Prevention and Suppression of Money Laundering and Terrorist Financing Law 188(I)/2007, whereby it was resolved the creation of the register of ultimate beneficial owners of the Cyprus companies which shall be administrated by the Registrar of Companies and the register of beneficial owners of express trusts and similar legal arrangements (the "Trust Register") which shall be administrated by the Cyprus Securities and Exchange Commission (the "CySEC").

Further to the above, on 18 June 2021, the CySEC published its directive/regulations "for the prevention and suppression of money laundering and terrorist financing in regards to the register of beneficial owners of express trusts and similar legal arrangements", which came into immediate effect and provides details and guidance for the registration of express trusts and similar legal arrangements in the Trust Register.

The term "express trusts" includes only those trusts that have been explicitly and voluntarily established by a settlor and do not refer to any trusts arising by operation of law nor trusts/decisions for which the settlor's clear intention for the establishment cannot be verified.

The Trust Register shall be maintained electronically by the CySEC and any express trust or similar legal arrangement is formally required to be therein registered under the following conditions:

  1. its trustee is situated or residing in the Republic of Cyprus, or,
  2. its trustee, which is situated or residing outside the EU, creates a business relationship or purchases immovable property on behalf of the express trust in the Republic of Cyprus.

The following information must be submitted for the registration of:

A. The express trusts or similar legal arrangements -

  1. Name of Trust;
  2. Country and date of creation and/or establishment;
  3. Applicable law;
  4. Termination date (if applicable);
  5. Country of residence of the trustee and his/her/its residential address;
  6. If the trustee is situated or residing outside the EU and establishes a business relationship in the Republic of Cyprus, the starting date of the business relationship, the name of the person to whom such business relationship is established and the document regulating such relationship;
  7. If the trustee is situated or residing outside the EU and purchases immovable property on behalf of an express trust in the Republic of Cyprus, the registration number of such immovable property and its title;
  8. In case of a similar legal arrangement, the kind of such arrangement; and
  9. Any other information and/or evidence documents requested by the CySEC for identification purposes.

B. The Ultimate Beneficial Owners of the Trust (Trustee, Settlor, Protector, Beneficiaries any other physical person exercising final control of the trust through direct or indirect ownership or by other means) -

  1. Name and surname;
  2. Name of father;
  3. Date and place of birth;
  4. Nationality or nationalities;
  5. Residential address;
  6. Number, type and country of issuance of identification document;
  7. Date of death (where applicable);
  8. Date on which the UBO became beneficial owner;
  9. The nature and extent of the rights which are directly or indirectly held by the beneficial owner;
  10. The role of the beneficial owner in the trust or in the similar legal arrangement;
  11. If the trust has class of beneficiaries, the CySEC requests a description of classes and the members of each class and also the nature and extent of the rights each class of beneficiaries has; and
  12. Any other information and/or evidence documents requested by the CySEC for identification purposes.

First submissions

A six-month period has been given for the submission of the beforementioned details and documents in the Trust Register.

Access

The CySEC can give access of the Trust Register to the following:

  1. The Cyprus Tax Department, the Cyprus Police and the Cyprus Customs Department with no restrictions;
  2. Any liable person, within the frame of due diligence and identification measures for their client;
  3. Any natural or legal person who can prove a legitimate interest. This will be subject to the CySEK's acceptance; and
  4. Any natural or legal person who has a controlling interest in a company or other legal entity, inter alia, either directly or not, indirect ownership, or through shares in the bearer or through control by other means. This will be subject to the CySEK's and Exchange Commission's acceptance.

If access is given, any natural or legal person will have access to the name, month and year of birth, the country of residence and the nationality of the people participated in the trust and also the type and extent of the rights they hold in the trust.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.