According to the European Commission, approximately 1.5 trillion euros are laundered annually in the EU—a sum comparable to the GDP of the world’s leading economies. This fact is not just shocking: it highlights how crucial the fight for corporate ownership transparency and AML compliance for businesses is in the face of global competition and stricter regulatory requirements. Today, no international entrepreneur can ignore the trend towards disclosure of beneficiaries in Europe: otherwise, the risks of losing access to banking services, investors, and markets become real.
The practice of COREDO shows: the transition to a single standard of transparency is not just a formality but a fundamental transformation of corporate governance affecting every company operating in the EU and beyond. In this article, I will examine in detail what changes for business, how to prepare for new requirements, and what solutions today allow not only to comply with the law but also to enhance the investment appeal of a company. I recommend reading to the end: you will gain not only a deep understanding of the reform but also concrete tools to protect your business interests.
Goals of Creating a Unified Register of Beneficiaries in Europe
The implementation of the EU unified register of beneficiaries is a response to the challenges of the digitalization and globalization era. The main task: ensure transparency of corporate ownership and create effective barriers to money laundering (AML) and terrorism financing, in line with international FATF standards. The new register makes information about beneficial owners of companies accessible to regulators, banks, and, in certain cases, investors, significantly simplifying due diligence procedures and reducing risks for the financial system.
Which Companies Must Disclose Beneficiaries in the EU
Disclosure of information about ultimate beneficial owners becomes mandatory for all legal entities registered in EU countries, including limited liability companies, joint-stock companies, partnerships, and foundations. Exceptions are only possible for public companies whose shares are traded on regulated markets, as their structure is already transparent to regulators and investors.
The legal entity register in the EU is now integrated with the platform for beneficiary registration, providing a unified standard for identifying the ultimate beneficiary. The solution developed by COREDO for clients with multi-level holding structures allows for the correct reflection of the ownership chain and avoids declaration errors.
New EU Requirements for Companies on Disclosing Beneficial Owners
The reform of EU corporate law has tightened requirements for company beneficial owners and intensified control over their identification. Companies are now required not only to disclose information about ultimate beneficiaries but also to update it with any structural changes.
What Information and Documents Need to Be Submitted to the Register
- Full name, date of birth, nationality, and residential address of the beneficial owner;
- information about the shareholding or other control in the company;
- supporting documents (passport, registry extract, founding documents);
- electronic signature for filing declarations through a digital platform.
Submission Deadlines for Beneficiary Declaration and Implementation Stages
The deadlines for submitting the beneficiary declaration depend on the jurisdiction, but in most EU countries, companies are required to submit information within 30 days of registration or making changes to the ownership structure. The implementation of the unified register of beneficiaries in the EU is carried out in stages: initially, the integration of national registers, followed by the launch of a pan-European digital platform for data submission and updates.
Automation of Beneficiary Declaration and EU Digital Platform
The move to automation of beneficiary declaration and the launch of the digital platform for submitting beneficiary data are key elements of the reform. This not only speeds up compliance processes but also reduces the likelihood of errors associated with human factors.
How to Submit Beneficial Owner Information Through the EU Online Platform
- registration on the digital platform using an electronic signature;
- filling out the form with automated data verification;
- uploading supporting documents;
- receiving notification of acceptance and review status.
Integration of AML Systems with EU Registers and Best Practices
Integration of AML systems with EU registers is a crucial stage for companies working with financial licenses and subject to mandatory due diligence. Best practices include:
- automated verification of beneficiaries’ data against international and national registers;
- regular audits of the corporate structure;
- data exchange between registers in the EU, Asia, and Africa for global groups.
Responsibility and Risks: Fines for Non-Disclosure of Beneficiaries
The tightening of control over the disclosure of beneficiaries entails not only administrative but also criminal liability for company directors and owners. Business risks for non-compliance with new rules include account blockage, loss of licenses, and reputational damage.
| Violation | Sanctions and Fines | Consequences for Business |
|---|---|---|
| Late Disclosure | Administrative fines | Account access restriction |
| Concealing Beneficiaries | Large fines, account blockage | Criminal liability, reputational risks |
| Data Errors | Correction, re-submission | Enhanced oversight, audit |
What Happens for Concealing Beneficiary Information in Europe
Concealing beneficiary information in Europe is punishable by large fines, account blockages, and even criminal liability for directors. In some cases, blocking EU sanctions against companies can occur, leading to a complete halt of operations and loss of business reputation. The solution developed by COREDO for clients with an international structure includes regular audits of corporate structure and automated data checks to minimize such risks.
Typical Errors in Declaring Beneficial Owners
COREDO’s experience shows that the most common errors in declaring beneficial owners are related to:
- incorrect identification of the ultimate beneficiary;
- untimely data updates with structural changes;
- inconsistency of data with internal KYC procedures and bank requirements.
Compliance procedures for international companies should include regular data checks and staff training on new EU standards.
Impact of the Unified Beneficiary Register on Business and Investment Climate
The implementation of the unified beneficiary register significantly changes the rules for international business. On one hand, corporate transparency for investors is strengthened, which increases trust and facilitates funding attraction. On the other hand, the burden on corporate governance and compliance departments increases.
How New EU Rules Affect Company Investment Attractiveness
Company ownership transparency becomes a key factor for investors and banks. New EU requirements for beneficiary disclosure allow for simpler due diligence procedures and reduced risks for financial institutions. The COREDO solution for automating the submission of beneficiary information has already helped clients expedite funding and improve investment attractiveness.
Features of Beneficiary Disclosure for Holding and Multi-Level Structures
For holding and multi-level structures, disclosing beneficiaries requires special attention: it is important to accurately reflect the entire ownership chain, including foreign and nominee shareholders. Auditing the corporate structure and automating compliance processes help avoid errors and ensure compliance with new EU requirements.
Protection of Beneficiaries’ Personal Data and GDPR
In the context of digitalization and data exchange between EU, Asia, and Africa registries, the protection of beneficiaries’ personal data comes to the forefront. Companies must comply not only with European GDPR standards but also with international FATF standards for preventing money laundering.
How to Ensure Data Protection for Beneficiaries in New Conditions
To ensure the protection of beneficiaries’ personal data, COREDO recommends:
- using automated verification systems with data encryption;
- restricting register access to authorized individuals only;
- regularly performing compliance audits to GDPR and FATF standards.
Restrictions and Exceptions: When a Company May Not Disclose Beneficiaries
In some cases, a company may be exempt from disclosing beneficiary information—for example, if shares are traded on regulated markets or the company is under blocking sanctions. However, such exceptions are strictly regulated, and attempts to abuse them lead to severe sanctions.
Practical Steps for Companies: How to Prepare for New EU Requirements
Implementing new procedures requires a systematic approach and a revision of internal regulations. COREDO’s experience shows that successful adaptation is only possible with close interaction among legal, compliance, and IT departments.
Action Algorithm for Businesses to Implement New Procedures
- Audit the corporate structure and identify ultimate beneficiaries.
- Update internal KYC and AML policies considering new EU requirements.
- Implement automated tools for submitting and updating beneficiary data.
- Appoint individuals responsible for monitoring structural changes and timely declarations.
- Organize personnel training on new compliance procedures.
- Prepare for the inspection of beneficiary data by governmental bodies.
Automation Tools and Best Practices for Compliance with New Requirements
The most effective tools for complying with new EU requirements are:
- automated compliance platforms with integration into government registers;
- electronic document management and electronic signature systems;
- services for automatic data verification and monitoring of structural changes.
Key Conclusions and Recommendations for Entrepreneurs and Leaders
The implementation of the EU unified register of beneficiaries is not just a new formality but a strategic challenge and opportunity for business. Companies that timely adapt their compliance procedures, automate declarations, and ensure personal data protection receive:
- access to financial services and investments;
- reduced corporate risks and reputational losses;
- increased transparency for investors and partners.