The register of Ultimate Beneficial Owners (UBOs) in the Netherlands is likely to be introduced in January 2020, subject to completion of the legislative process in the Dutch parliament. We spoke with Bauke Faber, senior legal counsel at Intertrust to understand more about the recent updates to the UBO register in the Netherlands (NL).
Q: Bauke, please give us a brief introduction as to what's expected with the UBO register.
We expect the UBO register to be live in the Netherlands in January 2020. Each company or other entity incorporated or founded in the Netherlands must obtain information on the persons who ultimately own or control them (commonly referred to as UBOs) and register this information in the NL UBO register. The NL UBO register will be part of the Dutch Trade Register. Once the register is in place, existing entities will have 18 months to register their UBOs - so until Mid-2021.
Q: Tell us, which entities are affected?
Only companies, other entities and partnerships incorporated or founded in the Netherlands must disclose its UBOs in the NL UBO Register. The location of their business (inside or outside the Netherlands) is irrelevant. A legal entity not incorporated under the laws of the Netherlands, but with its principal place of business or branch in the Netherlands, does not need to register a UBO in the NL UBO Register. This is because Dutch law assumes that this legal entity has such obligation in its home state.
There are also requirements for de-registered partnerships, a business which is no longer established in the Netherlands but belongs to a (limited) partnership or shipping enterprise. These are formed under the laws of the Netherlands and should be re-registered in the Dutch Trade Register, so it can then register its UBO.
Q: What are the implications for listed entities? Are they exempt?
Each "issuer" of securities incorporated under the laws of the Netherlands which complies with either disclosure requirements as meant in the transparency directive or international standards comparable with such disclosure requirements (a.k.a. "Dutch stock listed entities") and each 100% subsidiary of such "issuer" are exempted from the obligation to register a UBO in the NL UBO register.
The free float percentage is irrelevant for this exemption. A Dutch entity can list its securities on stock exchanges around the world. Unfortunately, not all jurisdictions have standards comparable with the disclosure requirements under...