Disclosure of ultimate beneficial owners: new regulations

On 28 April 2020 came into force amendments to the Law of Ukraine “On State Registration of Legal Entities, Individual Entrepreneurs and Non-Governmental Organisations” (the “State Registration Law”) which were introduced by the Law of Ukraine “On Prevention and Counteraction to Legalisation (Laundering) of the Proceeds of Crime, Financing of Terrorism and Proliferation of Weapons of Mass Destruction” of 6 December 2019.

Main novelties of the State Registration Law relate to new regulations of disclosure of ultimate beneficial owners in Ukraine.

1. Legal entities registered before 28 April 2020 shall be obliged to make a filing to a state registrar on their UBOs and ownership structure within 3 months from the date on which a respective legal enactment providing the form and content of the ownership structure comes into effect.

1. For state registration or state registration of changes to information on the entity in the Unified State Register of Legal Entities, Individual Entrepreneurs and Non-Governmental Organisations (the “Companies Register”) – each legal entity shall be required to file information on its UBOs or absence of a UBO along with the ownership structure, extracts from the foreign companies/trade registers in respect of the entity’s shareholders being foreign legal entities and notarised identification documents in respect of foreign UBOs.

1. All companies shall be obliged to keep information on their UBOs and ownership structure updated, and to submit documents confirming any changes to this information to the state registrar within 30 business days from the date of such changes.

1. Each company shall be required to file updated information on its UBOs or absence of a UBO annually within 14 calendar days of the day of its state registration.

Violation of the new regulations, in particular failure to disclose or untimely disclosure of information in the Companies Register on the UBO of a legal entity or on the absence of a UBO, or non-provision of documents confirming such information shall be treated as an administrative offence sanctioned by a fine of UAH 17,000 to UAH 51,000 personally against the director of the company or the person entitled to act on behalf of the company (its executive body).

Please note that practical implementation of the changes to the State Registration Law shall be conditional on the adoption of relevant legal enactments in pursuance of such changes. We shall keep you informed on any developments in this sphere.