Which entities are required to be registered in the Central Register of Beneficiaries? What is the penalty for lack of entry in light of the amendment of the Law on Prevention of Money Laundering and Financing of Terrorism?
The amendment of March 30, 2021 of the Law on Prevention of Money Laundering and Financing of Terrorism extended the list of entities required to report and update information on actual beneficiaries.
In the new text of the Act, in addition to the companies listed in article 58, sections 1-5, among others, general partnerships, limited partnerships, limited join-stock partnerships, limited liability companies as well as joint-stock companies, the newly added sections 6-13 will also require trusts whose trustees holding equivalent positions with smaller residences or registered offices in the territory of the Republic of Poland to report the beneficial owner in the Central Register of Beneficiaries and trusts whose trustees, or persons in equivalent positions, entering into economic relations or purchasing real estate in the territory of the Republic of Poland on behalf or for the benefit of the trust. In addition, partnerships, European companies, cooperatives, European cooperatives, associations subject to registration in the National Court Register or foundations will be subject to notification.
These entities will have a strict deadline for making an entry, namely 7 days from the moment of registration of entrepreneurs in the National Court Register. In the case of trusts, this period will be calculated from the date of creation, transfer of the registered office or residence in the Republic of Poland by the trustee of the trust or a person occupying an equivalent position or establishment of economic relations or acquisition of real estate in the Republic of Poland for or on behalf of the trust, by the trustee of the trust or a person occupying an equivalent position. According to the text of the newly provided paragraph 1a in article 61, person who makes notifications is required to provide personal data such as name, nationality, country of residence, PESEL number or date of birth and the function entitling to make the subject notification. The amendment of the Act in article 68 indicates that the obliged institutions are required to map discrepancies between the information collected in the Central Register of Beneficiaries Actual and the information about the customer’s actual beneficiary determined by it, take action to explain the reasons for these discrepancies, as well as inform the relevant authority of such discrepancies with a justification and documentation of discrepancies.
Importantly, the amendment indicates that the person making the notification or update is liable for damage caused by submitting untrue data to the Register, as well as failing to submit data and changes to the data covered by the entry in the Register within the statutory deadline. An exception is if the damage was caused by force majeure or solely due to the fault of the injured party or a third party for which the person who files the information on actual beneficiaries and update them is not responsible.
In the aforementioned amendment, the legislator also decided to significantly increase the applicable amount of the financial penalty.
Thus, in the event that beneficial owner fails the comply with the obligation to provide the relevant information to entities obliged to make an entry in the Central Register of Beneficiaries owners, he/she will be subject to a financial penalty of up to 50 000 zlotys.
In the case, that the above-mentioned entities required to collapse the information on beneficial owners and update it, the trustee or the axis holding an equivalent position do not comply with the obligation to notify or update the entries within the time limits indicated in Act, and have provided information that is inconsistent to a financial penalty of up to the 1 000 000 zlotys.
The Minister competent for public finance will be authorized to impose the aforementioned financial penalties.