A new amendment to Cyprus’ AML regulatory framework has brought significant changes to the implementation of the Ultimate Beneficial Owner (UBO) Register and its related penalties, fines and deadlines.
As outlined in previous publications, the UBO register is a centralised database which holds detailed information on the individuals who ultimately own or control legal entities registered in Cyprus.
The latest changes come in the form of the Prevention and Combating of Money Laundering (Amendment) (No. 2) Law of 2024 (number L.141(I)/2024) which was published on 6 December 2024.
A related Registrar of Companies Directive KDP423/2024, published on 16 December 2024, provides for additional legislative alterations.
In this article, we outline the changes resulting from the new legislation.
- The Prevention and Combating of Money Laundering (Amendment) (No. 2) Law of 2024
- Fines and penalties for failing to submit or update information on the beneficial owners will now be imposed solely on the company or legal entity in question, with the company’s directors and secretary no longer bearing direct financial accountability.
- While penalties are no longer imposed on the directors individually, a director or managing directors may still hold legal responsibility for the payment of any financial burden imposed on the company or legal entity due to any omissions or failures in its UBO register reporting obligations.
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- The amounts payable for penalties have also been revised as follows:
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- The penalty for non-compliance on the first day following the lapse of the deadline is now €100, reduced from the previous amount of €200.
- For each subsequent day of continued non-compliance, the penalty is now €50, reduced from €100, with a maximum cumulative fine of €5,000, instead of the previous maximum of €20,000.
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- The Registrar of Companies is granted the authority to issue Directives to establish an administrative review process and/or to facilitate the submission and evaluation of objections against decisions to impose financial penalties.
- The Registrar of Companies is granted authority to issue Directives for establishing an administrative review process and/or facilitating the submission and evaluation of an objection against a decision imposing financial penalties or fines.
- The Registrar of Companies is further given the power to strike off from the Companies Registry any legal entity that fails to meet its obligations regarding the filing and updating of information on the UBO Register.
- The Registrar of Companies may also, under these new provisions, apply to the Court for an injunction ordering the compliance of any person failing to meet their reporting obligations regarding the UBO register.
- Registrar of Companies Directive KDP423/2024
- Under this Directive from the Department of Registrar of Companies and Intellectual Property, a further extension for the submission of UBO Register information is granted until 31 January 2025.
- Furthermore, the deadline for confirmation of UBO Register data is also extended to 31 March 2025.
- In light of these extensions, the Department has decided to revoke any previously imposed penalties and issue refunds for any amounts already paid out.
- How These Changes Impact Your Business
These amendments simplify compliance responsibilities for directors while ensuring entities meet their UBO obligations. However, non-compliance remains a serious matter, with updated penalties and potential legal action by the Registrar. Businesses are encouraged to:
- Review their UBO information promptly.
- Submit or update information before the new deadlines to avoid penalties.
- Contact legal or compliance experts to understand their responsibilities and facilitate any necessary filings.
If you have made payments for any related penalties and as such are awaiting a refund, or would like further information on the implications of these latest legislative changes, we invite you to contact us at your earliest convenience. Our team will be happy to assist you in facilitating the refund process and answering any of your queries.
For more information, please reach out to Kyriaki Stinga and Dorina Mastora.