Latvia Tightens Screws on Beneficial Ownership Rules and Regulations
The Latvian government has reinforced its stance on beneficial ownership rules and regulations, mandating all individuals and entities to comply with international and national sanctions. This move aims to prevent illicit financial activities and ensure transparency in business dealings.
Understanding the Obligations
According to Section 2, Paragraph two of the International and Republic of Latvia Law on National Sanctions, it is obligatory for everyone involved in capital transfer transactions or registration of legal persons to conduct thorough investigations into their counterparties. This means verifying that neither individuals nor entities are subject to international or national sanctions.
Key Obligations:
- Verify that counterparties are not listed in the Financial Intelligence Service (FIS) database
- Comply with sanctions imposed by the Office of Foreign Assets Control (OFAC)
- Check if counterparties are listed in the OFAC sanctions database
Accessing Sanctions Information
The Ministry of Foreign Affairs provides clarification on sanctions through its website, serving as a coordinating authority for information dissemination. Individuals and entities can consult this resource or contact sankcijas@mfa.gov.lv for further guidance.
Identifying True Owners
For legal persons, identifying true owners is crucial to ensure compliance with beneficial ownership rules. The Enterprise Register’s online platform provides access to information on registered legal entities and their beneficiaries, enabling individuals and entities to verify the authenticity of counterparties.
Key Features:
- Access to information on registered legal entities and their beneficiaries
- Ability to verify the authenticity of counterparties
Updating Information
In cases where changes are discovered in the registers carried by the Enterprise Register, there are no restrictions on registration of new or updated information. For instance, if a true beneficiary is found to be an authorized person, registering the individual as the legal person’s true beneficiary is permissible, and it is mandatory for the legal person to submit relevant updates to the Enterprise Register in accordance with regulatory enactments.
Conclusion
The Latvian government’s emphasis on beneficial ownership rules and regulations underscores its commitment to promoting transparency and preventing financial illicit activities. Individuals and entities must adhere to these guidelines to ensure compliance with international and national sanctions, thereby safeguarding their business dealings and reputation.