On 4 April 2019, the Dutch Minister of Finance (the Minister) submitted a legislative proposal for the introduction of an ultimate beneficial owner register (the UBO Register) in the Netherlands (the Proposal) to the Dutch Parliament. The Minister also, among other things, submitted the explanatory notes to the Proposal, as well as the advice from the Dutch Council of State (Raad van State) and the Dutch Data Protection Authority (Autoriteit Persoonsgegevens, the AP).
The UBO Register is a register that will contain details on individuals that are ultimate beneficial owners (UBOs) of legal entities based in the Netherlands (UBOs of foreign entities active in the Netherlands will not be included in the UBO Register). All Member States, including the Netherlands, are required to introduce a UBO Register pursuant to the Fourth Anti-Money Laundering Directive (EU/2015/849) (Vierde anti-witwasrichtlijn, 4MLD). Under 4MLD, Member States had until 26 June 2017 to implement a UBO Register. On 31 March 2017 the first draft legislative proposal to this end was published in the Netherlands for public consultation, but no drafts were since then submitted to the Dutch Parliament. Similar to the implementation of the other provisions of 4MLD – which was dealt with in a separate legislative proposal that came into force on 25 July 2018, more than a year after the deadline of 25 June 2017 – there have been significant delays in the legislative process. On 20 April 2018, the Minister announced that implementation of the UBO Register would be postponed to the beginning of 2019 as a result of the Fifth Anti-Money Laundering Directive (EU/2018/843), which was adopted on 14 May 2018, and contains some key changes to 4MLD, including changes relating to the UBO Register (more details on the key changes to 4MLD and the Dutch act implementing 5MLD can respectively be found here and here).
The primary purpose of a UBO Register is to combat financial-economic crime, such as money laundering, corruption, fraud and terrorist financing. The details that will be included in the UBO Register will partly be public, which should allow organisations to take informed decisions as to with whom they want to do business. The UBO Register will become part of the existing Trade Register (Handelsregister) of the Dutch Chamber of Commerce (Kamer van Koophandel).
Among other things, the Proposal provides that:
- the UBOs of the following organisations will need to be registered in the UBO Register:
- private limited liability companies (besloten vennootschappen met beperkte aansprakelijkheid) and (non-listed) public liability companies (naamloze vennootschappen);
- other legal entities, i.e. foundations (stichtingen), associations (verenigingen), mutual insurance associations (onderlinge waarborgmaatschappijen) and cooperatives (coöperaties);
- partnerships (maatschappen), general partnerships (vennootschappen onder firma) and limited partnerships (commanditaire vennootschappen);
- shipping companies;
- European limited liability companies (SEs);
- European Cooperative Societies (SCEs); and
- European economic partnerships;
- UBOs of listed companies, sole traders (eenmanszaken), associations of homeowners, certain historical legal entities and congregations (kerkgenootschappen) do not need to be registered;
- the following details of UBOs contained in the UBO Register will be publicly available:
- given name and family name;
- month and year of birth;
- country of residence; and
- size and nature of the economic interest of the UBO,
the publicly available section of the UBO Register will only be searchable using the organisation’s or legal entity’s name – it will not be possible to search using the name of a (possible) UBO and ;
- the following details of UBOs are not publicly available (only competent authorities and the Financial Intelligence Unit will have access to these details):
- citizen service number/foreign tax identification number;
- date of birth;
- country and city of birth;
- residential address;
- copy of a valid proof of ID; and
- copy of documents showing the size and nature of the economic interest held by the UBO.
- it is believed that the UBO register will be compliant with the EU General Data Protection Regulation (which seems to have been confirmed by the AP in its very brief advice).
View the Proposal (Dutch only), 4 April 2019.
View the explanatory notes to the Proposal (Dutch only), 4 April 2019.
View the Dutch Council of State’s advice (Dutch only), 21 February 2019.
View the AP’s advice (Dutch only), 6 November 2018.