Verifying the real owners of companies will now be easier.
On September 6, the Verkhovna Rada finally voted for the draft law No. 6320 on disclosing the ultimate beneficial ownership (UBO) of legal entities. The changes will bring us closer to the FATF anti-money laundering standards and will help implement one of the recommendations on candidate status in the EU.
What has changed in verifying the real owners of companies?
- The verification of information about persons who are the ultimate beneficial owners of companies submitted to the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Organizations in electronic form was automatized, using the means of the Unified State Web Portal of Electronic Services;
- the requirements for exclusively notarial certification of copies of documents submitted to confirm the identity of the ultimate beneficial owner were cancelled;
- the procedure by which legal entities determine information on the UBO and ownership structure was specified;
- legal entities and individuals who are the founders (participants) of legal entities and/or exercise decisive influence over their activities were obliged to provide, at the request of legal entities, the information necessary for the submission of information about the UBO and the ownership structure of the legal entity for entering or updating by the legal entity in the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Organizations;
- a system of methodological assistance to legal entities in determining UBO and ownership structure was created.
Is Everything that Good?
Unfortunately, the provision that forced to annually confirm information about beneficiaries in the register was cancelled. Having this standard would significantly help us have a proper system of verification of information about the UBO.
It is not yet known when the new rules will come into effect.
Potential for the Future
This small victory is a component of the future powerful victory both on the front and as the fulfillment of the most ambitious global challenge — that is, the creation of a comprehensive system for verifying information about UBO in Ukraine. We still have a chance to be the first country in the world to implement this tool.
In 2020, the Ministry of Justice launched the Unified Register, in which it clearly defined and separated the concept of the “ultimate beneficial owner.” This increased the overall accountability in the ownership structure of individuals and legal entities.
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