Episode 4: Ultimate Beneficiary Owner (UBO)
What does it mean?
Regulated nationally by Law No. 129/2019 for the prevention and combating of money laundering and terrorist financing, the Ultimate Beneficiary Owner (UBO) is a concept introduced in the EU by the Directive (EU) 2015/849 on prevention of the use of the financial system for the purposes of money laundering or terrorist financing.
Basically, the EU intends to create a ledger in which each Company will indicate the natural persons who really control the Company in order to avoid any attempt of money laundering.
Who is UBO?
UBO is considered any natural person who controls a Company, holding at least 25% + 1 share of the Company total shares.
If such person does not exist or it cannot be indicated, the UBO will be identified with the Administrator(s) of the Company.
Who has to submit the Declaration?
The obligation is applicable to all entities - registered with the Trade Register Office – according to which such entities must submit a declaration attesting the real beneficiary of the business no matter if such Company is owned by natural persons, legal person or both of them.
What's the procedure?
In order to fulfil such obligation, the Administrator of the Company has to fill up and submit with the Trade Register a Declaration indicating the Ultimate Beneficiary Owner of the Company which he manages.
Afterwards, the Declaration must be submitted with the Trade Register.
When does it have to be submitted?
- at the moment of a company’s setup;
- within 15-days as of the modification of the Ultimate beneficiary ;
- on a yearly basis, within 15-days as of the approval of the annual financial statements.
The obligation to submit the UBO Declaration is also fulfilled by including, at the registration, in the Articles of Incorporation, the identification data of the real beneficiaries and the ways in which the control over the legal person is exercised. The subsequent modification of the identification data of the real beneficiaries does not establish the obligation to draft and submit a modifying act to the Articles of Incorporation, their declaration being fulfilled by submitting the Declaration.
Failure to submit the Declaration is sanctioned with a fine between RON 5,000 and RON 10,000.
If, after being sanctioned, such company fails to submit the Declaration within the 30-days’ legal term, the Trade Register may request the dissolution of the Company.