The purpose of Law No. 1.503 of 23 December 2020 is to strengthen the legislative arsenal in the Principality of Monaco in the fight against money laundering, terrorist financing and corruption.
This new law aims to transpose the provisions of European Union law, referred to in Annex B of the Monetary Agreement between the Principality of Monaco and the European Union of 29 November 2011, in particular EU Directive 2018/843, the so-called "Fifth Directive".
Although published in the Journal de Monaco No. 8519 of 1 January 2020, the entry into force of the provisions of Law No. 1.503 is staggered.
The persons subject to AML/CFT/CO provisions are very diverse. Indeed, the following persons or entities are required to apply them, among others:
- trustees;
- property dealers;
- art professionals;
- multi-family offices;
- sports agents.
The significant contributions of Law No. 1503 include:
- the extension of the accessibility of the register of beneficial owners and the register of trusts;
- the creation of a register of payment accounts, bank accounts and safes, kept by the Service d'Information et de Contrôle sur les Circuits Financiers (SICCFIN) on the basis of declarations made by financial institutions;
- clarification of the enhanced due diligence measures to be implemented with regard to business relationships or transactions involving high-risk third countries.
It will be developed below on the register of beneficial owners as well as on the register of trust.
- The register of beneficial owners:
The provisions of Law No. 1.503 on the register of beneficial owners, which entered into force on 31 December 2020, aim to:
- clarify some of the obligations of legal persons required to obtain and maintain adequate, accurate and up-to-date information on their beneficial owners and on the beneficial interests held by them;
- explain some of the aspects of the procedure for entering such information in the register;
- indicate the rules applicable in the event of disputes arising during the procedure;
- define which persons and entities may have access to the information contained in the register;
- complete the procedure for the beneficial owner to request a restriction of access to information concerning that beneficial owner.
Sovereign Order No. 8.634 of 29 April 2021 provides further details.
- The register of trusts:
Law No. 1.503 also introduces further amendments to Law No. 214 of 27 February 1936 revising Law No. 207 of 12 July 1935 on trusts.
The amendments made by this law have the following objectives:
- to replace the term "directory of trusts" with "register of trusts";
- specify that the obligation to possess and keep accurate and up-to-date information on the beneficial owners of trusts applies to trustees who administer trusts in Monaco;
- create a reporting and information obligation for trustees and any person holding an equivalent position in legal arrangements similar to trusts;
- specify the provisions relating to the obligation to register trusts, and in particular who is responsible for this obligation;
- define which persons and entities may have access to the information contained in the register;
- provide for the possibility for the trustee or the person occupying an equivalent position in a similar legal arrangement to apply under certain conditions for restricted access to information on beneficial owners;
- provide for an obligation to update the information in the register of trusts.
The new provisions relating to the register of trusts only came into force on 28 February 2021.
Sovereign Order No. 8.634 of 29 April 2021 sets out the conditions for the application of Law No. 1.503.
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.