Law

The Mystery of Ultimate Beneficial Owner

Even though it is relatively unknown, the Registry of Ultimate Beneficial Owners (in Polish: Centralny Rejestr Beneficjentów Rzeczywistych, CRBR) has become officially operational as of 13th October 2019 – almost one year ago. What is CRBR? Who should be listed in the Registry? And last but not least – what are the consequences for those who fail to fulfil duties related to CRBR?

Who should be reported to CRBR?

Reporting to CRBR is mandatory for all ultimate beneficial owners (UBOs), with their definition being established by an Act of 1st March 2018 on countermeasures against money laundering and terrorism financing (Ustawa z dn. 1 marca 2018 roku o przeciwdziałaniu praniu pieniędzy oraz finansowaniu terroryzmu – Dz. U. 2019, poz. 115). The definition includes a large variety of entities, while being extremely complicated and causing serious doubts even for experienced professionals. In short, a UBO is a person holding more than 25% of shares in a company. If exact shares cannot be established, a person holding senior management position is considered an UBO. Additionally, a person that effectively controls the company directly or indirectly, as well as a person ultimately gaining benefits from owned or otherwise controlled company, are also considered UBOs. The definition of UBO applies also to a person, which effectively and decisively influences actions and decisions undertaken by the company.

It is important to notice, that duties related to UBOs do not apply to public companies as regulated in Act of 29th June 2005 on public offer and rules related to introduction of financial instruments to an organised trading system and on public companies (Ustawa z dn. 29 lipca 2015 roku o ofercie publicznej i warunkach wprowadzania instrumentów finansowych do zorganizowanego systemu obrotu oraz o spółkach publicznych – Dz.U. 2019, poz. 623).

Deadlines

Entities registered in Polish KRS (Krajowy Rejestr Sądowy, National Court Registry) before 13th October 2019 had 6 months to make a report on UBO – this deadline passed on 13th April 2020.

Legal entities registered after 13th October 2019 have much less time to make a report – just 7 days after their entry inti KRS, or in case of changes in KRS entry – 7 days after introduction of the change.

Keep in mind, that in all cases the 7-day deadline does not include weekends and national holidays.

Who should make the report?

The report to CRBR can be issued only by a person authorized to represent the company, i.e. person listed in KRS entry as authorized to represent the company. The report must be verified using qualified electronic signature or by ePUAP profile. This regulation has no exceptions – any plenipotentiaries or attorneys of a company are not authorized to issue reports themselves.

In case when more than one person is required for a valid representation of a company, the report must be undersigned by all people required in KRS entry, regardless of order of undersigning. In this case, both electronic signature and ePUAP profile may be used.

Consequences of non-compliance

Both the company and person issuing a report in its name may face severe consequences in case of wrong or delayed report.

A person issuing a report may be held responsible for losses caused by incorrect data published in report or by failure to obey deadlines established by law – possible consequences include fine of up to 1.000.000,00 PLN and prohibition of performing duties in a managerial position. A company itself, in case of failure to issue a report or in case of incorrect data presented in report, may be punished by a fine of up to 1.000.000,00 PLN or by prohibition of performance of certain activities.

In order to avoid consequences mentioned above, and fulfil legal obligations vested in the company, just fill a simple report at https://www.podatki.gov.pl/crbr. The report includes most basic information on the company, as well as on the UBO. It can be swiftly filled out entirely online, but sadly the form is available in Polish only.

Good luck!

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