Turkey Introduces New Regulations for Disclosure of Beneficial Ownership Information
In line with global standards set by the OECD’s Financial Action Task Force on Money Laundering (FATF), Turkey has introduced new regulations aimed at combating money laundering. One key aspect of this is the requirement for companies operating in Turkey to disclose their beneficial owner information.
Key Provisions of the General Communiqué No. 529
- Corporate taxpayers and general partnership companies must provide information on the person authorized to represent the company or partner, as well as the person holding the highest amount of shares in ordinary partnerships.
- Executives, trustees, or representatives of trusts and similar entities established abroad but with headquarters in Turkey or an executive residing in Turkey must also be disclosed.
Definition of Beneficial Owner
The communiqué defines beneficial owner as “the natural person or the person who ultimately controls or has ultimate influence over a legal entity or unincorporated entities.” In determining the beneficial owner, if it is suspected that the real person partners holding more than 25% of shares in the legal entity are not the beneficial owners, or if there is no real person partner holding such an amount of shares, the real person or persons who ultimately control the legal entity will be considered as the beneficial owner and subject to disclosure.
Disclosure Requirements
- If the beneficial owner cannot be identified, the information of the real person or persons with the highest level of executive power must be disclosed.
- In organizations such as unincorporated business partnerships, the real person or persons who ultimately control the unincorporated entity, or if the beneficial owner cannot be identified, the real person or persons with the highest level of executive power at the unincorporated entity will be considered as the beneficial owner in their capacity as the senior executive and subject to disclosure.
Reporting Obligations for Certain Entities
- Banks, factoring companies, insurance companies, sports clubs, and notaries are required to report, upon request, the beneficial owner information regarding transactions carried out by their customers.
Important Considerations
- Companies must identify the person who will be included in the disclosure by taking into account the explanations in the communiqué and conducting a detailed analysis.
- These individuals may be held responsible for investigations and liabilities that may arise in the future in tax and other matters.