The new regulation of the German Money Laundering Act (GWG), in force as of 1 August 2021, entails for almost all companies domiciled in Germany a new obligation to designate beneficial owners in the Transparency Register and to keep the data up to date.
Missing or incorrect information can lead to penalties, in the worst scenario of up to 5 million Euro or 10 % of the total turnover.
The Money Laundering Act introduced such an obligation already at the end of 2017. However, many companies were exempted if the beneficial owners could be electronically traced from the Companies or Associations Register (fictitious publicity). This effectively relieved many companies with recent registration in such registers. With the new regulation, this exemption is abolished and a general registration obligation is imposed.
Who is obliged to register?
All companies, limited liability companies, public limited companies, limited partnerships, partnerships (GmbH, GmbH & Co. KG, AG, KG, OHG, SE) as well as trusts, cooperatives, registered associations and foundations. Individual entrepreneurs and private partnerships are exempted.
Who must be identified?
Beneficial owners, natural persons who directly or indirectly hold 25% of the capital or voting rights, or who exercise control in a similar way.
When must the identification take place?
– Companies not benefiting from the previous fiction: immediately.
– Those benefiting from the previous fiction before 31.03.2022 (AG, SE and KGaA), 30.06.2022 (GrbH, Partnerschaften und Genossenschaften) and 31.12.2022 (OHG, KG, Vereinen and the rest).
Eulalia Galceran and Oliver Haaga from Auren Germany