Financial Crime World

LUXEMBOURG TO INTRODUCE REGISTERS OF BENEFICIAL OWNERS BY MARCH 1ST

New EU Anti-Money Laundering Directives Affect Luxembourg Businesses

The European Union’s anti-money laundering directives are set to have a significant impact on businesses in Luxembourg, with new rules requiring the registration of beneficial owners coming into effect on March 1st.

Background: EU Anti-Money Laundering Directives

As part of its efforts to combat money laundering and terrorist financing, the EU has introduced the fourth anti-money laundering (AML) directive, which requires each member state to establish registers of beneficial owners. The fifth AML directive, passed last year, amends this rule to require that corporate entities and other legal bodies in Luxembourg have a register of beneficial owners.

Luxembourg’s Response: RBO Law

In response to these directives, the Luxembourg government has introduced its own law on the creation of a register of beneficial owners (RBO Law). The RBO Law is set to come into effect on March 1st, with all businesses falling under the new rules having six months to comply.

Key Requirements Under the RBO Law

  • Companies and other entities will be required to provide information about their ultimate beneficial owners, including:
    • Name and first name
    • Date and place of birth
    • Nationality
    • Country of residence
    • Private or professional address
    • National identification number
    • Nature and extent of the beneficial interest held
  • This information will be recorded in a public register, which can be accessed by authorities and members of the general public

Exceptions to the Rule

Companies listed on certain regulated markets will only have to provide the name of the relevant market, rather than the details of their ultimate beneficial owners.

Consequences of Non-Compliance

Failure to comply with the new rules could result in serious penalties, including fines of up to 1.25 million euros. Businesses and individuals must ensure that they are aware of these requirements and take the necessary steps to register their beneficial owners by the deadline.