22.05.2015

Deadline for Submission of Information on Beneficiaries Extended

On 21 May 2015 the Parliament passed the Bill "On Amendments to Certain Laws of Ukraine regarding the Information about Ultimate Beneficiary Owners (Controllers) of Legal Entities" (Bill No. 2896) into law. The Law extend the deadline for companies to submit information about their ultimate beneficiary owners (controllers) (hereinafter – the Beneficiaries) or about the absence of such by 25 September 2015.

Also, the Law stipulates that information about beneficiaries shall not be submitted by:

-          state owned and municipal enterprises;

-          companies whose shareholders are individuals only (if such individuals are real owners).

If a company has no beneficiaries, it should submit data about the absence of beneficiaries. However, the law-maker failed to clarify what should be understood as such data. Therefore, the question remains whether it will be enough to specify the relevant information in the form submitted to a registrar or it will still be necessary to provide supporting documents.

A company’s failure to provide the required information within the prescribed term entails a fine of UAH 5,100 to UAH 8,500 for individuals responsible for its provision.

It should also be noted that the Law will most probably not come into effect until 25 May 2015 (the deadline for submitting information about Beneficiaries). Thus, the companies that have failed to submit the relevant information on time may potentially be brought to liability. However, such developments are quite unlikely, as they would be fully in conflict with the idea of the adopted Law. As soon as the Law comes into effect, such companies will not be subject to prosecution, as the Law extends to the previously existing relations and cancels liability for the administrative violation.

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Kind regards and best wishes,

Anna Zorya

Partner, Head of  Corporate and M&A Practice

Maksym Cherkasenko

Partner, Head of  Corporate and M&A Practice